Colleges, Universities, and Professional Schools — Business Survival Rate

An estimated 57% of colleges, universities, and professional schools businesses survive their first 5 years, based on U.S. Census Bureau Business Dynamics Statistics. The annual business closure rate is 10.7%.

57%
5-Year Survival Rate
+3.0%
Net Growth Rate
2,335
Total Firms
110
Annual Firm Deaths

Is Colleges, Universities, and Professional Schools a Good Business to Start?

With a 57% five-year survival rate, colleges, universities, and professional schools is near the national average (~50%). This means roughly half of new entrants will still be operating after 5 years — typical business risk that rewards solid planning and execution.

The annual exit rate of 10.7% indicates moderate turnover. Success depends on differentiation, location, and operational efficiency rather than inherent industry advantages.

Entry vs. Exit Rates

Annual rate of new businesses opening versus existing businesses closing.

Entry Rate (new businesses)4.2%
Exit Rate (closures)10.7%

Net negative: more businesses closing than opening (-6.4 pp spread).

Job Creation & Destruction

6.8%
Job Creation Rate
3.8%
Job Destruction Rate
+3.0%
Net Job Growth

The industry is adding jobs faster than losing them — a positive sign for both workers and new business owners looking to hire. Total employment: 1,719,589 workers across 2,335 firms.

Want to know how much colleges, universities, and professional schools businesses actually make?

See full revenue benchmarks for Colleges, Universities, and Professional Schools →

Frequently Asked Questions

What percentage of colleges, universities, and professional schools businesses fail?
Approximately 43% of colleges, universities, and professional schools businesses fail within their first 5 years. The annual closure rate is 10.7%, with 110 firms closing permanently in 2023.
Is the colleges, universities, and professional schools industry growing or shrinking?
The colleges, universities, and professional schools industry is currently growing with a net job creation rate of +3.0% per year. New businesses are entering at 4.2% while 10.7% close annually.

Source: U.S. Census Bureau, Business Dynamics Statistics (2023). Survival rate estimated from annual exit rates.