Genio Study Reveals Student Churn Crisis Costs Higher Education $10.72 Billion Annually

New report "The Churning Point" exposes massive financial impact of student attrition and provides research-based strategies to reduce churn

CLEARWATER, Fla., Sept. 9, 2025 /PRNewswire/ -- Genio, a provider of learning tools that significantly improve student success, today released "The churning point: How student attrition is impacting higher education's bottom line." The report reveals that student churn costs higher education institutions a devastating $10.72 billion annually, with first-year students accounting for just over 45% of those losses. This represents more than 1.25 million learners dropping out every year, and the effects of this crisis extend far beyond institutional balance sheets.

The financial hemorrhaging varies dramatically by institution type. Public four-year colleges bear the highest total cost burden at $3.99 billion annually, while public less-than-two-year institutions face the steepest percentage losses with 15.5% of their full-time equivalent enrollment dropping out each year.

As for students, those who drop out often accumulate substantial debt without earning the credentials increasingly demanded by employers. Over 65% of jobs today require post-secondary education, a figure projected to reach 70% by 2027.

The financial case for taking measures to increase retention is compelling. The report calculates that even modest improvements—a 5% increase in first-year retention with proportional gains in subsequent years—would save the average institution $258,982 annually while preventing over 75,000 students nationally from dropping out.

Root causes of the crisis
The study identifies a complex web of interconnected factors driving student attrition. Financial pressures top the list, as college tuition has tripled over the last three decades while student loan debt has surpassed $1 trillion nationally. Additionally, the demographic transformation of higher education has created additional challenges, with the non-traditional "New Majority" learners who now dominate enrollment.

These new majority learners are time-poor due to work and family obligations and often arrive underprepared for college-level academics. First-generation students, who account for nearly 30% of the student population, are particularly vulnerable due to their lack of cultural capital and familiarity with academic expectations.

Proven strategies for retention
Thankfully, despite the sobering statistics, the report emphasizes that institutions have significant power to reverse these trends through targeted interventions. Early warning systems that identify at-risk students have proven effective when coupled with personal outreach and support. Additionally, financial literacy programs, exemplified by Indiana University's MoneySmarts initiative, have documented $158 million in reduced student borrowing over eight years.

The study also highlights the importance of psychological support and building belonging, pointing to Texas A&M University's comprehensive first-generation student program as a model for creating community and providing targeted academic advising. Courses that teach time management, note-taking, and critical thinking can level the playing field for students from diverse backgrounds, while flexible online programs remove barriers that prevent non-traditional learners from succeeding.

"Every dropout represents a future cut short, alongside billions in lost revenue for colleges," said Dave Tucker, founder and CEO at Genio. "The good news is that institutions now have more proven ways than ever to provide proactive learning support, giving students the skills and confidence to stay and succeed."

This comprehensive study analyzed data from the Integrated Postsecondary Education Data System (IPEDS) to quantify the staggering financial impact of student dropout across the United States. The authors relied on additional academic studies to provide research-based strategies institutions can implement to reduce churn.

Download the report here: "The Churning Point: How Student Attrition is Impacting Higher Education's Bottom Line." To learn more about Genio, visit https://genio.co.

About Genio
Genio's mission is to unlock better learning for everyone, with courses that develop learning skills and tools that put knowledge into action. Genio's products are beautifully simple, meaningfully structured, and effortlessly connected. Trusted by more than 1,000 institutions globally, Genio has assisted learners in over 1.6 million classes, empowering 91% of learners using Genio's tools to improve and maintain their grades while reducing stress and boosting confidence. Especially as non-traditional students become the new majority learner, Genio helps institutions increase persistence and grow graduation rates.
For more information on Genio, visit https://genio.co.

SOURCE Genio