The education ministry will review its enrollment eligibility requirements for financial aid after a larger than expected number of private junior colleges, particularly those in rural regions, learned they would be disqualified.

The tougher requirement, introduced last year, dictates that four-year and two-year education institutions that have failed to clear a minimum 80-percent enrollment for three consecutive years will, in principle, be ineligible for state financial aid packages for low-income students.

Many education experts noted that the two-year junior colleges have long been a source of indispensable personnel for rural regions as preschool teachers, nutritionists and care workers.

The experts said the enrollment requirement would force many of these schools to close and accelerate the decline of rural, depopulated regions as they try to stay functional.

The ministry has taken notice of these concerns.

“We recognize that closure of colleges and junior colleges will narrow the education choices for low-income students,” a ministry official said. “The ministry will review the new setup to make it consistent with the purpose of the financial aid program.”

The numbers of junior colleges and enrollees have been steadily declining since peaking in the 1990s. Japan’s decades-long shrinking birthrate is a key factor behind the trend.

Over three years from fiscal 2025, at least 45, or 16 percent, of the 282 junior colleges in Japan are scheduled to close.

The ministry’s enrollment rule was seen as potential death blow to other struggling schools.

The government’s aid program, established in fiscal 2020, provides students in need with grants or exempts them from paying part or all of their tuition fees.

But this setup was also seen as enabling some junior colleges to remain open despite dwindling student numbers and deteriorating financial health.

The ministry wanted the penalty to pave the way for financially challenged institutions to quickly shut down and prevent disruptions for students seeking higher education.

The ministry in August released a list of 31 private junior colleges deemed ineligible for the financial aid program.

Of them, 14 have decided to close.

SHORING UP LOCAL ECONOMIES

One junior college, in eastern Japan, has a history of more than 50 years.

Its last graduating class will be in 2027, featuring students who enrolled this spring.

“The declining birthrate has certainly impacted us,” the president of the school told The Asahi Shimbun. “But being denied access to the state financial aid program was the final straw.”

More than 10,000 people have graduated from the junior college.

“We have produced personnel who shored up local industries,” the president said.

The junior college, like other schools in the countryside, has struggled to attract students.

The school turned to a selection process that does not rely on exam scores to fill most of its available slots. But enrollment sharply dropped in fiscal 2021 after hovering above 90 percent in the preceding years.

Enrollment for fiscal 2025, which began in April, fell below 50 percent, according to the school. It was around 60 percent for fiscal 2024.

Compared with four-year universities, junior colleges often provide an affordable option for high school students from low-income families. Parents may feel they can send their children to higher education if the financial burden is limited to two years.

At the junior college in eastern Japan, roughly 30 percent of the students received financial aid, largely through state funding.

The president said being denied access to the state financial aid program was particularly damaging.

“We have pushed for education reform based on the needs of local communities and by working with local authorities and businesses,” he said. “But the ministry did not pay attention to the content of the reform and drew a line simply on the basis of the enrollment rate. Is the ministry saying that the role of junior colleges is over?”

The president expressed concern about the potential implications for the local economy after the school’s closure.

The disappearance of hundreds of students will likely translate into reduced revenues for apartment owners and restaurants, he said.

SHIFT IN FEMALE STUDENTS

Takashi Aso, head of the Association of Private Junior Colleges in Japan, also blasted the ministry for imposing the penalty.

“It is highly regrettable to see many junior colleges close despite their graduates doing excellent jobs in their own fields,” he said.

Aso cited Mitsuko Tottori, the Japan Airlines Co. president, as a notable example.

Tottori, a native of Fukuoka Prefecture, graduated from a private junior college in Nagasaki in 1985.

The association’s data showed that 23 private junior colleges have stopped accepting applications in fiscal 2025, meaning they will shut down when the current first-year students graduate.

Twenty-one more schools are expected to halt applications next fiscal year, and one more in fiscal 2027, according to the association’s count as of the end of March.

The association underlined the contribution of junior colleges to regional economies, saying the rate of their graduates who start work closer to home is higher than their counterparts from four-year institutions.

Many research papers said it has been common for junior college graduates to enter the workforce expecting to play a subordinate role and then quit their jobs after finding a marriage partner.

More female students had enrolled in junior colleges than in universities until 1995, ministry statistics showed.

Female enrollees at junior colleges have decreased since peaking in 1993.

One reason for the drop is that many businesses cut clerical jobs during the economic doldrums following the bursting of Japan’s asset-inflated bubble economy in the early 1990s.

Another reason is that more female high school students have opted for four-year universities as they grow increasingly conscious of their career options.

The disparity between universities and junior colleges has continued to expand.

In fiscal 2024, about 29,000 women entered junior colleges, compared with 290,000 for four-year schools.

BAD FINANCIAL SHAPE

The number of junior colleges slid to 468 in 2006 after reaching a peak of 598 in 1996.

Many junior colleges closed to transform into four-year institutions in response to the shift in female students’ preferences.

Since 2013, after the shift quieted down, fewer than 10 junior colleges closed annually.

But that has changed with the imposition of the education ministry’s penalty concerning enrollment. Many junior colleges were already in bad financial shape by that time.

A fiscal 2022 ministry survey found that 76 percent of the 185 small and midsize private junior colleges in rural regions and 68 percent of the 100 schools in urban areas were nearly in the red.

The share of students facing financial hardships at private junior colleges tends to be higher than the ratio at private four-year institutions.

A fiscal 2022 study by the Japan Student Services Organization (JASSO), a government-affiliated body overseeing scholarships and financial aid programs for students, found that the average annual household income for students attending private colleges was 8.64 million yen($60,420), while the figure for private junior college students stood at 6.42 million yen.

JASSO’s fiscal 2023 survey showed that 10 percent of students at private colleges relied on financial support programs, while the rate was 16 percent at private junior colleges.

If schools become ineligible for the state aid program, high schoolers with limited financial resources will likely opt for other junior colleges where financial support is available. That would further push down enrollment and heighten the likelihood of closure for struggling schools.

“If things are left as they are, we would be unable to produce human resources who will work for local economy,” Aso of the Association of Private Junior Colleges said. “The ministry should review the tightened requirements for state financial aid as early as possible.”

Ministry officials said one idea for easing the requirement is to treat disqualified schools as “exceptional cases” if they are recognized as playing a crucial role in producing personnel with expertise and skills needed in a regional economy.

The ministry also plans to make it easier for disqualified schools to rejoin the state assistance program if they reach 60-percent enrollment for three straight years.