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Higher Ed's Key Market Challenge: Demographic Cliff or Emerging Learning Ecosystem?

Joseph E. (Tim) Gilmour

This blog looks at the challenging market for higher education in this decade, providing some insights that higher education leaders should consider as they lead their institutions in this decade.

Demographic Cliff?

Much has been written recently about the high school graduate demographic cliff higher education faces in 2025. Based on recent data from the National Center for Educational Statistics, however, it appears that there is no cliff nationally in 2025 and that the greater short-term demographic challenge lies with the significant change in the racial and ethnic composition of the high school graduate population.

Nationwide, the high school graduate population is projected to grow by seven percent between 2012-13 and 2026-27. Ten states, principally in the Northeast and Midwest, are expected to experience a greater than five percent decline in that population during the period. These numbers are echoed in WICHE projections; it should be noted that these data, which extend to 2037, project a 10 percent national decline by that time.[1]

The greater challenge for higher education between now and 2026-27, according to the NCES projections, will be the changing racial/ethnic composition of the high school graduates coming to them. The white population, the largest segment served, is projected to decline by 15 percent, while the Hispanic segment is projected to grow by 49 percent—changes that will have to be factored into most institutions’ academic and supports services plans.

2030 Knowledge and Learning Ecosystem

In our book, Transforming for Turbulent Times, we argue that the principal strategic challenge--and opportunity-- facing colleges and universities between now and 2030 will be the rapid emergence of what we call the Knowledge and Learning Ecosystem shown in the figure below. Learners are at the center of this ecosystem, connected to three sets of value providers. Higher education institutions will be but one part of this larger ecosystem. The scope and size of their role—and their long-term viability--will depend on how much they transform to adapt to these rapidly changing conditions. To be successful, we hold that they will need to transform into engaged, innovative learning enterprises with the following characteristics:

  • Engaged, innovative, open, nimble, and affordable;

  • Provider and certifier, curator and concierge; and

  • Move from gatekeeper to active gateway.

Figure 1

To function in this way, college and universities will have to: digitally transform all of their processes; offer new, open curricula; leverage many channels of engagement; and deploy multiple modes of learning.


Based on this market analysis, we draw the following conclusions.

  • The notion of a high school graduate demographic cliff in 2025 is overstated and only affects institutions in ten states centered in the Northeast and Midwest. However, it remains clear that in the long-term the high school graduate market is a declining one.

  • A second demographic issue for the high school graduate market is that a projected significant change in its racial/ethnic composition will require colleges and universities to offer new academic and support programs that serve these populations better.

  • Good news awaits institutions that can successfully transform to serve the 2030 Knowledge and Work Ecosystem by becoming engaged, innovative learning enterprises. Their enrollments will likely increase as they expand and transform to serve learners throughout their lifetimes, offering what is called the 60-year curriculum. As an added bonus, many of the steps they take to serve this new market will help them address the racial/ethnic challenges before them.

  • College and university leaders would be well advised to take these trends into account and begin now to transform their institutions to take advantage of these opportunities and gracefully reduce their capacity in traditional markets that are certain to decline in the long-term. Transforming in Turbulent Times provides these leaders with an action agenda for successful transformation at their institutions and can be ordered on our website. (

[1] WICHE, Knocking at the College Door, 10th Ed, December 2020.


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