College enrollment is dropping as Millennials head back to work, which is squeezing revenues in the educational sector.
A new report finds that spring college enrollment dropped nearly 2% from last year. According to the National Student Clearinghouse Research Center, community colleges and for-profit institutions were among the hardest hit, with rates falling 3.9% and 4.9% respectively.
Much of the declines in enrollment stemmed from adults 25 and older choosing to enter the workforce rather than pursue a degree. Meanwhile, the number of students attending college straight out of high school was unchanged.
“The stronger job market is pulling in the more marginal college students,” says Yahoo Finance Senior Columnist Michael Santoli. “A degree [would] be something they thought could get them to a job. They don't necessarily need to take that step.”
For-profit institutions have come under intense government scrutiny over the past year. Corinthian Colleges (COCO) closed all of its schools last month after it was accused of falsifying its finances and job placement rates.
“The for profit education space has been in complete turmoil. The government is in the process of driving some of these companies out of business,” Santoli says. “So I do think that there's some noise in the numbers.”
Santoli adds that rising student debt likely plays a factor in the enrollment declines. He also notes that college acceptance rates and financial aid package rates are dipping slightly.
“Those numbers are coming down because we have seen the peak in terms of 18 year old population, so it seems as if it will add a little bit to the [enrollment] numbers, but not very rapidly.”
Related: Corinthian Colleges shuts its doors