Overview of Are small town colleges going extinct?
This NPR Indicator episode uses the show’s “Beige Awards” format to highlight what the Federal Reserve’s Beige Book is saying about the economy, then zooms in on a major concern for New England: the weakening outlook for higher education. The main takeaway is that small colleges—especially in towns that depend on them—are under intense pressure from falling enrollments, demographic shifts, rising costs, and changing student preferences, leading to closures that ripple through local communities.
Key takeaways
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Higher education is facing a serious slowdown.
- The Boston Fed’s Beige Book entry notes a moderate slowdown in higher-ed activity.
- One Massachusetts college recently closed, and another scaled back expansion plans and reduced staff because of declining enrollment.
- The outlook for higher education was described as increasingly pessimistic.
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Several forces are driving the decline.
- Fewer college-age students are entering the pipeline because of demographic changes.
- International student visas have become harder to obtain under the Trump administration, reducing another enrollment source.
- More people are choosing alternatives to four-year degrees, including trade schools, technical programs, and jobs in construction or transportation.
- High tuition costs make many families question the return on investment of a traditional college education.
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Small colleges are especially vulnerable.
- In many small towns, a college is one of the largest employers and a major part of the local identity.
- When a school closes, the damage extends beyond students and faculty to the broader community.
Notable Beige Book anecdotes
Dallas Fed: wage pressure
- A contact said some job candidates were asking for “San Francisco wages,” a humorous way of describing rising pay expectations.
New York Fed: luxury real estate tax effects
- A contact noted that some buyers of luxury properties in New York City shifted into renting after a proposed tax on high-value second homes.
- The segment uses this as a simple illustration of how taxes change behavior.
Boston Fed: the winning entry on higher education
- The Boston Fed won the episode’s top Beige Award for reporting that:
- higher-ed activity slowed,
- a Massachusetts college closed,
- another cut headcount and expansion plans,
- and the overall outlook worsened.
Case study: Anna Maria College
The episode focuses on Anna Maria College, a small rural Massachusetts school that abruptly closed.
What happened
- The college had a small student body, around 1,500 students.
- It offered programs including nursing, fire science, business, and criminal justice.
- Faculty said financial problems had been building for years before the school suddenly announced it would not reopen in the fall.
Why it struggled
- According to former humanities chair Travis Maruska, the school was caught in a costly competition to attract students with:
- new buildings,
- amenities like coffee bars,
- and expensive upgrades that did not necessarily improve academics.
- He argues that the broader higher-ed system became trapped in an arms race of spending, driving up tuition while not always benefiting professors or students.
Human impact
- Maruska describes the closure as devastating because it affects:
- students trying to transfer,
- faculty losing jobs,
- and the campus community that functioned like a family.
- He says he is considering a career shift into mental health counseling, which may offer more stable employment.
Broader implications
- The episode suggests that small-town colleges may continue to disappear unless the financial model of higher education changes.
- Their loss is not just an education story—it is also an economic development story for towns that rely on them.
- Massachusetts is presented as a particularly stark example because higher education is such an important part of the state’s economy.
- The episode notes that Hampshire College in Amherst is also shutting down, reinforcing that Anna Maria is part of a larger trend.
Bottom line
The episode argues that small colleges are not necessarily extinct yet, but they are under severe strain. Declining enrollments, rising tuition, shifting labor-market preferences, and local economic dependence make closures increasingly likely—especially for small schools in rural or economically fragile communities.