Despite a recent uptick following the COVID-19 pandemic, U.S. community college enrollment rates have fallen sharply since 2010. From 2010 to 2023, enrollment numbers decreased by 22% overall, or 1.7 million fewer students. This trend was widespread, with 42 states reporting enrollment declines of more than 10% over the same period.
A February 2026 Economic Review by Emily Pollard, associate economist at the Federal Reserve Bank of Kansas City, explores the trend further. Pollard investigates whether this decline could be attributed to supply factors in education, such as funding issues leading to reduced program offerings and increased tuition, or demand factors such as prospective students’ desire to go straight into the workforce or pursue a four-year degree instead. “After looking at the data, I concluded that demand factors have been the primary driver of enrollment declines,” Pollard said. “Compared with 2010, prospective community college students have better outside options. There are more jobs available if they want to work, and the wage gains from getting a bachelor’s rather than an associate degree have grown.”
The state of Missouri is no exception to the decrease in community college enrollment. Brian Millner, president and chief executive officer of the Missouri Community College Association, said the change can be explained by economic factors, especially with 2010 as the benchmark.
“Community college enrollment typically has a positive correlation with the unemployment rate,” Millner said. “When the unemployment rate spikes, more people decide to go back to school and pursue other fields of work, and community college enrollment also rises as a result. When you look at national enrollment data with that context, it makes sense that the U.S. hasn’t topped enrollment numbers from the aftermath of the Great Recession.”
Tough Choices
While the federal minimum wage has remained $7.25 per hour since July 2009, each state’s minimum wage may affect the desirability of an associate degree for prospective students. When making the decision to pay Clark Lauritzen tuition and sacrifice time that could be spent working to pursue higher education, Millner said prospective students are often faced with a tough choice about whether short-term sacrifices for longer-term benefits are worth it financially.
Consider the tradeoff for a Missourian contemplating an associate degree in early childhood education with the goal of becoming a preschool teacher. In 2025, the median Missouri wage for a preschool teacher was $17.35 an hour, only $2.35 more than the state’s minimum wage ($15 as of Jan. 1, 2026). For some, going straight into the workforce in fields such as food service, retail and housekeeping and earning a $15 starting wage with benefits is a more viable option than the upfront sacrifice of time and money pursuing higher education requires.
Still, Millner said the lifetime benefit of an associate degree shouldn’t be discounted. A community college education can open doors to career paths that require specific certifications, and an associate degree is often more accessible than a bachelor’s.
“There is research that people with a community college education will earn between $300,000 and $400,000 more over their lifetimes than those without,” Millner said. “While a bachelor’s degree holder might expect to earn closer to $1 million more over the course of their life, community college offers a cheaper, faster way to raise your prospective wage.”
Emily Pollard is an associate economist in the Economic Research Department of the Federal Reserve Bank of Kansas City.
But that return may be shrinking. Pollard found that the average wage of associate degree holders has declined relative to that of other education levels. Both bachelor’s degree holders and high school graduates have seen more wage growth than associate degree holders since 2010.
“Part of this is a change in educational requirements,” Pollard said. “There are just fewer jobs out there that typically require an associate degree. For example, take registered nurses. In 2010, an associate degree was the typical education required to become a registered nurse. And while many people still attend community college to become a nurse, it’s becoming more common for nurses to get bachelor’s degrees.”
Looking Ahead for the Higher Education Sector
Birthrates in the U.S. fell drastically after the Great Recession, and they remain near historically low levels today. While this trend has broad implications for the nation’s economy, it’s likely that the higher education sector may be among the first to feel the financial squeeze. Fewer prospective and enrolled students means fewer revenue opportunities for learning institutions, which may force community colleges and universities alike to shrink program offerings, reduce employee headcount or close altogether.
“While these changes are in response to reduced demand, they can still affect remaining students,” Pollard said. “If a community college closes, prospective students in that community may not have a good second-choice option and be pushed out of higher education.”
Community colleges are attempting to adapt to slowing demand by attracting new kinds of students. Some community colleges have also begun offering limited bachelor’s degrees. And dual-enrollment programs for high school students have become increasingly popular (but so far insufficient to offset lower overall enrollment). As of the 2023–24 school year, dual-enrollment students made up 22% of all community college enrollments
The views expressed are those of the authors and do not necessarily reflect the positions of the Federal Reserve Bank of Kansas City or the Federal Reserve System.
Author
