About one-fourth of the nation’s private, nonprofit campus are expected to close in the next 10 years, driven by artificial intelligence that is automating repetitive office roles that long have been reserved for liberal arts graduates.
Huron Consulting Group estimates, as reported by the Hechinger Report, that 442, or 26%, of the nation’s 1,700 private, nonprofit campuses will close or merge over the coming decade. That would affect 670,000 students
The nonprofit trade publication has noted that AI automation is accelerating the downsizing by reducing the perceived market value of many four-year degrees, hurting enrollment at tuition-dependent campuses.
“Most people think the panic is largely exaggerated, but colleges will close at a faster rate, and we don’t know what AI is going to look like in a few years,” said Dick Startz, an education economist at the University of California, Santa Barbara. “The higher education market is shrinking, and when that happens, an adjustment has to take place.”
Other estimates support Hechinger’s projections. Most identify small private schools and regional public campuses as the likeliest to fold.
The Huron Consulting Group rates more than 120 of the 442 private nonprofit schools as being at the very highest risk of closing.
The listings are not simply projections.
“The Huron and Hechinger data are based on actual enrollment trends and financial metrics, not guesswork,” said John Morganelli, a former Cornell University admissions director who directs admissions at Ivy Tutors Network. “And if AI keeps compressing the value of certain degrees in the job market, the pressure gets harder to escape.”
He said automation has added to the pressures of declining public confidence in college degrees, a doubling of tuition over the past 30 years and decreased employer satisfaction with graduates.
In recent months, Brandeis University President Arthur Levine estimated that 20% to 25% of all schools will close in the next few years. Many community colleges and regional public campuses are moving online to meet evolving labor needs.
He chalked that up to the U.S. transition from an industrial economy to a digital, data-based economy.
That would be a significant change from the 15% of all schools that closed from the 2013-2014 to the 2022-2023 academic years, according to Education Department data. The federal agency’s records show that 726 out of a historic peak of 4,725 degree-granting institutions collapsed in that period, more than 60% of them for-profit schools.
Now, fewer than 3,700 colleges and universities operate nationwide, and the bleeding continues: Hampshire College in Massachusetts is scheduled to go dark after the fall semester.
“Students have been spooked by the knowledge that more jobs will be automated, and that hurts enrollment at second-tier schools,” said Peter Wood, president of the conservative National Association of Scholars and a former associate provost at Boston University.
“A lot of kids are thinking they might be safer if they apprentice as a welder or painter and go to college later on,” he said.
In May, Forbes published its 2026 Private College Financial Grades, analyzing more than 900 nonprofit private colleges with enrollments of 500 or more students.
It awarded 27% a D for financial stability, the lowest grade possible, while noting that top-tier institutions were integrating AI to meet employer demand.
“The basic issue is that there are too many colleges and not enough students willing to pay even heavily discounted tuition,” said Gary Stocker, a former private school administrator who founded College Viability to evaluate campuses’ finances.
Nevertheless, some analysts have insisted that estimates in the 25% range in the Hechinger Report and elsewhere are too high for campus closures.
University of Georgia higher education professor Tim Cain said it is “highly unlikely” that so many colleges will disappear, even if closures do accelerate.
“We have heard similar projections for decades,” Mr. Cain said in an email. “Each time, those projections have been incorrect.”
Still, Dan Ye, a Maryland-based AI expert who lectures at Johns Hopkins University, said recent projections have underestimated how quickly AI is eliminating the demand for existing degrees.
“It is too conservative,” Mr. Ye said in an email, referring to the Hechinger estimate. “My own projection is that over half of America’s colleges will close in the next 10 years.”
Automating jobs
Labor analysts have flagged a spike in trade school enrollments and in job listings requiring “1-2 years experience, no degree necessary” as AI reshapes the job market.
According to Georgetown University’s Center on Education and the Workforce, nearly one-third of annual job openings through 2031 will require some credentials but no degree.
Meanwhile, a shortage of skilled workers in construction and plumbing has driven a spike in enrollment in short-term credentials for jobs AI cannot replace.
Mr. Ye flagged six Maryland universities in a report last month as financially “distressed” because of their growing inability to steer students toward middle-class jobs: Salisbury, Frostburg State, Washington Adventist, the University of Baltimore, Notre Dame of Maryland, and the University of Maryland Eastern Shore.
His report identified another 29 of 292 schools analyzed nationwide as “walking zombies,” or campuses so financially distressed that they are on track to collapse in the next five years.
They include Spring Hill College in Alabama, the University of Bridgeport in Connecticut and the University of the Holy Cross in New Orleans.
“We are only seeing the beginning of how artificial intelligence is completely rewriting the rules of the job market,” said Mr. Ye, CEO of CollegeNode, which advises universities on AI adoption.
“I believe AI is going to destroy jobs faster than consensus, and therefore lead to a massive number of parents turning away from college as the cost-return calculation breaks down,” he said.
Enrollment crisis
College admissions offices faced a 15% dip in potential college applicants for the upcoming fall semester, driven by a decline in U.S. birth rates dating back to 2008.
The nonprofit Western Interstate Commission for Higher Education projects that U.S. high school graduation numbers will fall steadily from a record 3.9 million students in 2025 to fewer than 3.4 million in 2041.
“The reality is that higher ed is experiencing a time of great transition caused by many years of demographic, economic and policy shifts,” said Geordie Hyland, president and CEO of the American College of Education, a for-profit online school in Indianapolis.
“Institutions that don’t adapt to change will face difficulties with maintaining enrollment and staying competitive in the market,” he said.
Other factors worsening the financial outlook for colleges include reduced international enrollment and changes in federal student aid, both driven by the Trump administration’s restrictions on immigration and curbs on loans for low-paying degree paths.
Omekongo Dibinga, a professor of intercultural communication and faculty affiliate to American University’s Antiracist Research and Policy Center, predicted that upcoming college closures will make higher education “less diverse and accessible” for racial minorities and low-income students.
“I do not believe that universities are right-sizing,” Mr. Dibinga said. “Too many have not seen the value of having groups from underrepresented communities, and that is only going to get worse.”
Conservatives argue that most humanities courses have focused more on teaching liberal race and gender identity theories, leaving students unprepared to enter the AI job market.
“I don’t think universities are reacting in an efficient way to AI workforce needs,” said Jonathan Butcher, an education policy fellow at The Heritage Foundation.
“As their enrollment goes down, the likelihood of closure goes up, and policymakers need to avoid propping up failing institutions,” he said.
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