Colleges & Universities in the US: Market Size, Businesses & Forecast 2026

The Colleges & Universities industry in the US encompasses postsecondary institutions providing academic courses and granting degrees at the baccalaureate or graduate levels. According to the National Center for Education Statistics (NCES), total undergraduate fall enrollment in degree-granting postsecondary institutions stood at 15.8 million students in 2023 (IES/NCES 2025). Concurrently, total enrollment in postbaccalaureate programs reached 3.2 million students in 2023 (IES/NCES 2025). The industry is navigating long-term demographic shifts and fluctuating public funding, though it remains a critical driver of economic mobility and specialized workforce development.

Industry snapshot

Key public data points

Historical & forecast

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What does the Colleges & Universities in the US industry cover?

This industry consists of postsecondary educational establishments that deliver academic courses leading to baccalaureate, master's, or doctoral degrees. Admission generally requires a high school diploma or equivalent certification. The scope includes public universities, private non-profit colleges, and private for-profit higher education institutions, but excludes two-year junior and community colleges that primarily award associate degrees.

• •Primary activities include classroom instruction, advanced research, and professional training in fields like medicine and law.
• •Operations cover both traditional brick-and-mortar campuses and distance-learning or online degree platforms.
• •Establishments are classified under the official North American Industry Classification System (NAICS) framework for educational services.

Who operates in the industry and how is it structured?

The US higher education market features a highly fragmented structure divided among public, private non-profit, and private for-profit entities. Public universities typically operate as large state-funded systems with substantial student bodies and broader curriculum choices. Private institutions, while generally smaller, account for a significant portion of total degree-granting entities and often rely heavily on tuition and private endowments.

• •State and local government funding for higher education institutions totaled $149.2 billion in fiscal year 2025 (SHEEO 2025).
• •States contributed $133.9 billion of total funding, representing a 3.4% inflation-adjusted increase over the previous year (SHEEO 2025).
• •Net tuition and fee revenue at public four-year institutions averaged $10.505 per FTE student in 2025 (SHEEO 2025).

What drives demand in the industry?

Demand for higher education is primarily driven by the long-term wage premium and employment advantages associated with obtaining a college degree. Fluctuations in the job market, corporate hiring standards, and federal financial aid availability directly influence student enrollment behaviors. Additionally, population demographics and high school graduation rates dictate the pipeline of traditional incoming freshmen.

• •In 2024, median earnings of bachelor's degree recipients age 25 and older with no advanced degree were $31,200 higher than high school graduates (College Board 2026).
• •The unemployment rate for individuals age 25 and older with at least a bachelor's degree sat at 2.6% in 2025 (College Board 2026).
• •Total education revenue across public institutions decreased 1.9% year-over-year to $19,443 per FTE in 2025, reflecting shifting demand dynamics (SHEEO 2025).

Who are the notable companies in the industry?

Competition in the industry takes place on multiple fronts, including academic prestige, program costs, online delivery capabilities, and career placement outcomes. While public and non-profit universities dominate total enrollment, corporate operators listed on public stock exchanges manage large-scale online and proprietary postsecondary networks. These corporate providers focus heavily on non-traditional, adult, and distance learners.

• •Strategic Education, Inc. operates notable institutions including Capella University and Strayer University within the US market.
• •Grand Canyon Education, Inc. provides comprehensive technology and operational services to Grand Canyon University and other partner institutions.
• •Adtalem Global Education Inc. operates specialized institutions including the American University of the Caribbean School of Medicine and Ross University School of Medicine.
• •American Public Education, Inc. manages online programs via the American Public University System and Hondros College of Nursing.

What are the recent trends and outlook?

The industry is adapting to a post-pandemic landscape marked by a structural expansion in virtual learning options and shifting institutional revenues. Net tuition revenues have faced downward pressure at many public institutions, forcing a greater reliance on state appropriations or alternative funding sources. Concurrently, graduate and postbaccalaureate programs have shown resilient enrollment trends compared to undergraduate programs over the past decade.

• •Total undergraduate enrollment decreased by 9% between fall 2013 and fall 2023, dropping from 17.5 million to 15.8 million students (IES/NCES 2025).
• •Total postbaccalaureate program enrollment increased from 2.9 million to 3.2 million students over the same 2013 to 2023 timeframe (IES/NCES 2025).
• •Public institution net tuition and fee revenue per FTE fell 3.5% in 2025, marking four declines in the last five years (SHEEO 2025).

How is the industry regulated?

Colleges and universities operate under strict federal, state, and institutional regulatory oversight. To participate in federal student financial aid programs, institutions must maintain institutional accreditation and satisfy rigid compliance standards mandated by the US Department of Education. For-profit operators are subject to heightened scrutiny regarding student loan default rates and career outcome disclosures.

• •Institutions must comply with Title IV of the Higher Education Act of 1965 to access federal pell grants and direct student loan funds.
• •State financial aid allocations per FTE reached a record high of $1,271 in 2025, tied to state-specific legislative mandates (SHEEO 2025).
• •Public universities remain bound by state budgetary allocations and legislative limits placed on in-state tuition increases.

Government, statistical and trade sources used for this Claight analysis.

• Institute of Education Sciences National Center for Education Statistics (IES/NCES) 2025 ·
• State Higher Education Executive Officers Association (SHEEO) SHEF Report 2025 ·
• College Board Research Education Pays Report 2026 ·
• U.S. Census Bureau NAICS Framework 2022