Vermont colleges chart a path forward against demographic and financial headwinds

Higher education institutions in Vermont are devising ways to stay afloat — from tuition discounts designed to boost enrollment to cutting employee benefits — as they face shifting demographics and financial constraints, college administrators say.

The Northeast region faces some of the sharpest impacts of the demographic cliff due to plummeting birthrates in the aftermath of the Great Recession starting in 2007, leading to a small pool of potential college students in Vermont in the coming years.

Only 45% of recent high school graduates in Vermont continue their education after 16 months, according to data from the Vermont Agency of Education. Meanwhile, the specter of the seven colleges across the state that shuttered in less than a decade looms large.

Many Vermont colleges face the same challenges that higher education institutions across the nation face, including “the demographic enrollment cliff and increased student price sensibility, rising operation costs, growing concerns about student debt and return on investment,” said Kimberly Jessup, president of Association of Vermont Independent Colleges.

One college that is working to remain above water is St. Michael’s College, which received notice from the New England Commission of Higher Education this past summer that it could lose accreditation if operating deficits and dropping enrollments continue.

St. Michael’s College deficit sat at $2.6 million in 2025, and its projected balance at the end of the 2026 fiscal year left it “little runway” for its financial future, according to a joint statement released by the commission and college . In August, the college received probate court permission to access $30 million worth of the principle from its restricted endowment if needed, said Ellen Kane, vice president of Advancement and Communications for St. Michael’s College.

“That money is not in our bank account; it’s still invested under the purpose of an endowment,” Kane said. “We will only access it if we need it, and the way you can look at it is a safety net or line of credit.”

Kane maintains that things are looking up for the college, which has stabilized enrollment numbers, she said, while it looks for ways to increase enrollment going forward. The college saw a 145% increase in donations in fiscal year 2026, totaling $13.6 million, according to Kane and it is half way through a 5-year plan to improve the school’s resources, educational program and finances.

Among the steps it has taken is creating an emergency services major, which includes emergency medical services and wilderness rescue training, in response to a local workforce gap, hopefully offering ready employment opportunities to students in the program.

St. Michael’s hopes to boost enrollment with the launch of a flagship match program last year, which sets the cost of tuition equal to the cost of in-state tuition at a student’s home state public university.

“We may be facing challenges right now, but we’re working on strategies to overcome them,” said Kane.

Tuition discounts are emerging as a popular strategy among higher education institutions across the state, including the University of Vermont and Middlebury College.

Middlebury College is cushioned from some of the demographic and financial headwinds facing higher education as it has the largest endowment in Vermont, said David Provost, executive vice president of finance and administration.

Still, Middlebury College has sought out financial sustainability strategies by reducing employee benefits under a budget stabilization plan last year that saved an excess of $15 million annually, said Provost. Middlebury College also sold the satellite graduate campus called Middlebury Institute of International Studies at Monterey to Soka University this year .

Provost said Middlebury College is focused on building out community partnerships in Addison County to try and persuade graduates to stay in Vermont, join the workforce and raise families in the state.

“We cannot lose more colleges in Vermont if we’re going to try to address Vermont’s demographic issue,” Provost said.

Champlain College has faced declining enrollment and financial deficits in recent years, while facing backlash for layoffs and phasing out five majors.

President Alex Hernandez said he recognizes that students are questioning the value of higher education, and Champlain College is allowing students to use more credits for internships and other career-building opportunities. The college hopes to attract people seeking to further their education, training and credentials through a broad selection of online classes.

Champlain College “redesigned a curriculum that looked a little bit like Lego blocks that you can snap together in lots of different ways to give students lots of different paths into the workforce,” Hernandez said.

Hernandez said that Champlain College has looked for ways to invest in financial stability, including previously selling off distant buildings in order to invest in dormitories closer to campus.

Champlain College has also launched a tuition discount beginning in the next school year that would match the tuition for the University of Vermont for a Vermont student’s first year, and cap out-of-state tuition and fees for first year students at $30,000.

Bennington College, which has faced operating deficits and laid off staff in recent years , created a taskforce to spot inefficiencies and ways to better use resources and engage the college community so it can make smart budget decisions, according to President Danielle Egan. She said the college hopes to close its deficit in the next three to five years.

It hopes to pump up its revenue with programs like a mental health counseling program, an educational licensure program, non-certificate-bearing summer programs and artistic residencies, Egan said.

“How do we make sure what we’re doing for our students makes the most sense and really targets back to what we think is most critical for a Bennington education?” Egan questioned. “We’re choosing a strategy that allows us to live into our distinction and live into our niche kind of place in the market.”

Jim Dlugos, president of Landmark College, with enrollment of roughly 600, teaches neurodiverse students and has escaped some of the financial pressures and demographic challenges because of its size and unique educational model. Three quarters of its endowment is unrestricted, giving it more leeway to use funds for various initiatives, he said.

Landmark is working to make the school more affordable for students through scholarships and aid, Dlugos said. Landmark College also has dual enrollment courses for high schoolers and is looking to expand into satellite campuses in other states with the same educational model. Students and alumni of Landmark College also have access to lifelong academic and career advisors, with career planning starting in the first semester, Dlugos said.

Vermont State University completed its formal merger process of three colleges into one system with five satellite campuses this year. The merger took three years and involved cutting programs. The university is working on closing the remaining $5 million gap of its structural deficit it inherited through the merger, said the Vermont State College System Chancellor Beth Mauch.

Older and working adults and students who need flexible education have helped enrollment at both Vermont State University and Community College of Vermont stay steady amid challenges faced by the industry, said Mauch, who oversees both institutions in her role.

Vermont Student Assistance Corporation President Scott Giles said he believes that Vermont colleges across the state should respond to growing return on investment concerns raised by students by reducing costs, clearly communicating value and creating shorter-term certificate programs, stackable credits and other workforce development opportunities that bring a more immediate payoff.

Thomas Cheney, executive director of Advance Vermont, said that it is important that the Vermont school system prioritizes career and education exploration and creates support systems for students so they are prepared after high school graduation.

“It’s not just that we have fewer young people in Vermont, but that fewer of those who are here are interested in continuing their education,” Cheney wrote in an email, adding that the job for education leaders is to show them a path toward that in Vermont.

This story was originally published by VTDigger and distributed through a partnership with The Associated Press.