But Hampshire is just the latest casualty in a broader trend. There are roughly 4,000 colleges in the United States. According to Jon Marcus, senior higher education reporter at the Hechinger Report, a nonprofit publication covering education, around 100 have closed since the Covid-19 pandemic, and many more are at risk over the next decade.

For now, large public universities and well-endowed private schools like Harvard and Yale remain relatively stable. But smaller regional colleges are increasingly at risk. That shift could leave students with fewer options for higher education, and,, for some, close the door on higher education entirely.

To understand why colleges are closing and what it means for the future of higher education in the United States, Today, Explained co-host Sean Rameswaram spoke with Marcus, who explained the story of Hampshire College and some of the financial, demographic, and cultural elements afflicting colleges. Below is an excerpt of the conversation, edited for length and clarity. There’s much more in the full podcast, so listen to Today, Explained wherever you get podcasts, including Apple Podcasts, Pandora, and Spotify.

Last week it was announced that the private liberal arts college Hampshire College would close after its fall semester. Tell us the story of what happened to Hampshire. Like a lot of small colleges, Hampshire had a lot of problems hidden just below the surface.

In Hampshire’s case, they weren’t that well-hidden. It had been having problems for more than six years, since before the pandemic, but was being kept afloat by its very loyal alumni, who include some people that have been extremely successful, largely in the arts. Its endowment was very small.

Its enrollment continued to decline. It had fewer than 800 students left at the end. It had $21 million in debt. Debt is a really important and largely misunderstood component of this.

When people think of debt and college, they think of student loan debt, but there’s also institutional debt, and it is really piling up. Colleges and universities have borrowed significant amounts of money and, so, servicing that debt becomes a big drain on their operating budgets. To attract students, colleges do something else that isn’t widely known: They discount the tuition.

Almost no one pays the list price you see on the website. At Hampshire, specifically, or everywhere? At colleges in general.

The discount rate at colleges and universities is more than 50 percent. So, if you were a private business, and you gave back 50 percent of your revenue, you’d be out of business. And that’s what’s happening to a lot of these small colleges.

At Hampshire, they were giving back more than 75 percent of their revenue in the form of discounts just to continue to get people to come there and fill seats. It sounds like this is happening far more often than we know — that four-year colleges and universities are going out of business. About a hundred colleges have closed since the pandemic.

Many of them only made it this far because they got federal aid during the pandemic to keep them open. Had they not, they would’ve probably closed sooner. And there’s a new estimate that shows that 442 private nonprofit colleges and universities — that’s one quarter of the total — are at risk.

About 120 of them are at severe risk of closing. What are the other causes for college closures? We are running out of students.

The number of 18-year-olds is way down. People stop having children during financial downturns. And if you do the math, the great recession was in 2008.

So, in 2026 is when that hits us. Eighteen years later, we’re running out of 18-year-olds, and that will begin to have an impact on college enrollment in the fall. The last big class was the one that enrolled in this most recent fall.

The next fall is when the demographic cliff begins to hit. And it’s just math. We have too many colleges, and we have too few traditional-age college students.

Of the ones we still have, a smaller proportion of graduates from high school are choosing to go to college. We hit a peak in 2016 of 70 percent of high school graduates going to college. That’s now down to just a little bit better than 60 percent.

That is a big, big drop in a very short time. And that has to do with the cost of higher education and the growing skepticism about the return on the investment. So, that’s really taking a toll.

There is the demographic cliff and cost. There’s also a culture war a