The implications of President-elect Donald Trump regaining the helm of the Department of Education have catalyzed many predictions and fears of how higher education will fare in 2025. In the face of such uncertainty, college and university leaders may feel compelled to sit tight and assess the climate.
“2025 is going to be a very interesting year to see what next step the industry needs to make,” says David Clark, managing director of higher education at BDO, an accounting and consulting firm. “They’re not done having to think strategically and be a little bit on the back foot, but they may be waiting to see what shapes over the next year before fully jumping into any one course of action.”
Amid bewildering headwinds, trends percolating from the past year have carved the path for what lies ahead in 2025.
Closures, cuts and layoffs will continue
More colleges and universities closed in 2024 than the previous year, and the number of institutions announcing significant cuts didn’t slow down either—even among larger, well-established institutions: Marquette University; Drake University; and the University of California, Santa Cruz are among the few.
While many institutions were forced to axe academic programs to address budget deficits, many leaders have described cuts as a strategic decision. “The reality is that we can’t be ‘everything, everywhere, all at once,’ and we can’t pretend to be,” wrote Franklin Gilliam, chancellor of UNC Greensboro, which cut 20 academic programs last February.
Amid a tightening pool of students due to the impending demographic cliff, institutions may re-invest in their areas of expertise—while shedding away the extraneous.
Colleges and universities will expand deeper digitally
As colleges and universities grapple with fiercer competition for students and a tightening operation budget, digital transformation became higher education leaders’ chief priority in 2024.
“From an efficiency perspective, there continues to be investment in tools that enhance the ability to complete tasks, make them more efficient and potentially reduce costs,” BDO’s Clark says. “On the academic side, [leaders are weighing] a full strategic shift to an online model rather than traditional on-campus learning.”
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More than half of the executives surveyed in a joint research initiative published last August said their institutions are beginning to shift their priorities to match the growing demand for online degrees. Melik Khoury, president of Unity Environmental University, credits his institution’s pivot to online as the catalyst for its explosion in enrollment and healthy bottom line.
Some institutions may be so invested in the future of online learning that they will consider reducing their physical footprint, Clark says. “Physical infrastructure costs money, continues to depreciate and requires additional investment in time, whereas digital and online infrastructure is a value creator.”
Heightening student transfers
Students will be less inhibited to transfer across higher education in 2025 to find the right institutions for them, thanks in part to efforts from policymakers and college systems, as well as advancements in edtech.
The Institution of Higher Education Transparency Requirements, signed by Colorado Gov. Jared Polis last May, aims to erase upward transfer credit loss. The move will decrease the number of credits that transferring two-year students will have to make up at a four-year college or university. The New Hampshire Department of Education has enacted a similar mandate, compelling two- and four-year universities to strengthen a seamless transfer pathway for college credits.
Likewise, the North Carolina Independent Colleges and Universities and the North Carolina Community College System have developed a new online portal that pulls institutional data from their combined 36 four-year colleges and 58 community colleges into one public database. State leaders believe that creating one holistic system will help eliminate the confusion surrounding the transfer process, encouraging students to find their right fit and boosting completion rates.
The emergence of new technologies, such as AI, will strengthen the ability of colleges and universities to better assess a transferring student’s remaining credits toward a degree, eliminating staff time and labor, says Joe Sallustio, vice president of industry engagement at Ellucian, a campus technology service provider.
“It’s all about student ease,” Sallustio says. “This is the piece we’re trying to get to, and you have to attack every part of the system, every policy and every piece of curriculum to be able to create automation.”
AI policy will gain a stronger foothold
While faculty are slowly beginning to understand how AI fits into classroom pedagogy, institutions will finally begin to build policy on an enterprise-level scale. And as federal AI regulations in the U.S. remain uncertain, recent guidelines provided by the National Institute of Standards and Technology, the European Union and even states like California and New York are helping lay the groundwork.
“This is not the time to ‘wait and see’—it’s time to prepare and continue to implement trustworthy AI practices,” Bruce Dahlgren, CEO of Anthology, said in an email interview. “Institutions can better position themselves to adapt to regulatory shifts while fostering trust and innovation.”
Increased competition from CTE programs
Lauded as the “toolbelt generation,” Gen Z has shown heightened interest in learning specialized blue-collar jobs. Interest in attending trade school nearly doubled among both teens and adults since 2017. In 2024 alone, search traffic is up 27%.
“In 2025, interest in skilled trades will continue to accelerate among young Gen Z, who increasingly view these careers as a more practical and rewarding alternative to traditional career paths,” Tracy Lorenz, president of the for-profit Universal Technical Institute, said in an email. “For a growing number, the skilled trades may offer a faster path to a career that aligns with their interests and goals.”
‘Value’ will be the word of the year
Higher education institutions will soon be tasked with complying with gainful employment and financial value transparency rules in 2025, heightening conversations surrounding ROI.
“These things are very much linked together: forgiveness, accountability and the ROI on an education—not just for the student and for the institution but for the taxpayer and everybody else involved in postsecondary education circles,” Sean McTighe, executive director of Title IV compliance and data intake operations at the National Student Clearinghouse, said in a previous University Business interview.
Bonus: Will Trump hurt international enrollment?
The prospect of a second Trump presidency can potentially restrict travel of foreign-born citizens, create longer visa processing times and restrict off-campus work opportunities for international students, says Travis Ulrich, senior vice president of customer experience at Terra Dotta. Such policy can hurt U.S. international enrollment and foreign students’ study abroad opportunities.
While Trump’s first term provides a strong indication of what lies to come, nothing can be certain until he’s in office.
“It’s hard to decouple 2025 with the potential impact of the Trump administration,” says Ulrich. “[Institutions] are all bracing for impact on immediate policy changes and whatever might come down the road.”
