Understanding and Improving Retention Rates in Higher Education

Retention rates in higher education are a mark of an institution’s health and a valuable metric for prospective students thinking about return on investment. Colleges and universities can improve retention rates with support services that help students overcome the personal, academic, and financial challenges that cause dropout.  

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“Retention rate” might sound like a technical term that wouldn’t matter to prospective college students, but make no mistake—it’s important to them. Students weigh academic reputation, campus vibe, support systems, and career outcomes when deciding where to apply and an institution’s retention rate is a bellwether for all of those factors. A high college retention rate doesn't just attract applicants—it keeps them there once they arrive. 

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Enrollify podcasts often discuss retention rates in higher education and, in this post, we’ll pull from those discussions to show why college retention rates matter, what they reveal about an institution’s health, and how they impact everything from academic performance to financial sustainability.

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What Are Retention Rates?

A retention rate in higher education is the percentage of students who return to the same institution from one year to the next. You may also hear the term “persistence rate.” The persistence rate measures the percentage of students who continue their education by returning to any institution for their second year. Lastly, attrition is the opposite of retention: the attrition rate is the percentage of students who do not return to school.

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Leaders in higher education watch their retention rate carefully, as an important metric of their institution’s health. Schools often monitor the retention rate for first year students more closely than other years, because a successful transition from freshman to sophomore year is one of the biggest predictors of a student’s success. 

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National retention trends reveal upward progress in student retention in recent years. The 2024 report from the National Student Clearinghouse showed that: 

• National retention rates are at 68%, their highest point in the last decade. 
• Community colleges currently have the greatest gains in retention rates over the past decade, increasing from 53% to 55% for incoming students. 
• However, retention rates of young learners is much higher than adult learners, with 72% and less than 50% respectively. And retention of Hispanic, Black and Native American students remains significantly below the national rate (64%, 57%, and 53%, respectively, compared to 68% nationally).

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The Importance of Retention Rates for Higher Education

High retention rates usually indicate strong academic performance, student satisfaction, and effective operations. A drop in retention rate can be a red flag, indicating financial difficulties, a lack of support services, or a misalignment between student expectations and their actual experience.

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Why does this matter? Aside from the obvious benefits of improving student outcomes, strong retention rates can also enhance:

• Institutional revenue and long-term sustainability
• School reputation and rankings
• Evaluation in accreditation reviews
• Cost effectiveness and resource allocation
• Alumni networks and giving

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In short, a strong retention rate supports both the financial and reputational stability of your institution while supporting your educational mission.

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Tips for Improving Retention Rates in Higher Education

Moving the needle on your institution’s retention rate can be a slow and sometimes opaque process. Here are some proven ways other institutions are improving retention.

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Enhance academic support

Research consistently shows that robust academic support leads to higher retention. It’s important to remember that academic support isn’t just for students who are falling behind in class. High performers also need support for overwhelm and burnout, which can contribute to withdrawal and attrition. Proven student success strategies, such as study groups, tutoring programs, time management workshops, and holistic advising services are important parts of the student safety net that keeps students on track for graduation. 

The use of AI-powered student success platforms is a new trend that’s helping many institutions improve retention rates. Features such as 24/7 responsiveness, multilingual support, and hyper-personalized guidance can give students round-the-clock service when staff aren’t available. These systems often include predictive analytics tools that can signal when a student’s academic performance begins to dip, helping advisors intervene before it's too late.

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Promote student engagement

Research shows that feeling socially isolated is one of the leading reasons students leave college. According to a 2024 report from Gallup and the Lumina Foundation, the primary threats to enrollment status among students are emotional stress (54 percent), followed by personal mental health reasons (43 percent). Surprisingly, while having friends is important, studies find that participating in student organizations plays an even greater role in improving retention. Colleges are wise to invest in student clubs, extracurricular activities, intramural sports, and community service opportunities—all of which give students a sense of belonging and empowerment. 

Student success teams are also finding innovative ways to improve retention through concierge-style communication. Forsyth Technical Community College, for example, is successfully increasing student engagement by handling inquiries in a way that mirrors the customer service best practices of the corporate world—and seeing a 9% increase in retention as a result.

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Improve financial support

Cost of attendance is the third biggest concern for students who are considering “stopping out” of their degree program, according to the Gallup and Lumina Foundation report. Increasing need-based scholarships and federal Work Study funding can directly combat this retention killer, but colleges can implement other strategies when financial aid is limited. Financial literacy programs, budgeting workshops, and guidance from financial services staff enhance a student’s financial wellness and reduce their stress around making ends meet while they are attending college.

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Personalize the student experience

In a recent episode of Enrollify’s “In Your Element” podcast, Guilford Tech Community College shared their success with personalizing the student experience to keep their students coming back. Using Element451, GTCC sends tailored emails to students, welcoming them to each semester and informing them about available resources like free counseling, disability services, and emergency financial help. These personalized touches make students feel supported and connected, increasing their likelihood of staying enrolled and succeeding.

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Factors That Influence Retention Rates

Understanding and improving retention rates requires extensive data collection and analysis, because there are so many factors that influence retention rates in higher education. Here are some of the main factors that determine whether a student re-enrolls or withdraws from college. 

• Financial constraints
  Difficulty covering tuition and living expenses, as well as poor financial hygiene, is a significant barrier to re-enrollment, particularly for students from underrepresented backgrounds. 
• Student engagement
  Combatting feelings of isolation among your students with strong student engagement programs, outreach from peers, and faculty mentorship can produce strong gains in retention rates.
• Quality of academic support
  The availability of academic advising and tutoring is important, but ensuring these services are effectively calibrated to the different needs of your students is more critical to retention rates.
• Institutional culture
  Inclusive policies and happy, well-trained staff are key to the welcoming environments that help students succeed from year to year.
• Personal circumstances
  Stressors such as commuting distances, work schedules, illness, child care, family issues, and cultural pressure to work instead of study can inhibit many students’ abilities to return to school.
• First-year experience
  Students who experience difficulty during first-year orientation or the start of the school year can easily fall behind for the rest of their first year, which leads to attrition.

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Monitoring Retention Rates

Schools keep an eye on retention rates using a mix of tools and strategies that make tracking and intervention more effective. Here’s how they do it:

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Predictive Analytics: By analyzing data like demographics, academic performance, and engagement trends, schools can spot students who may be at risk of leaving. AI-enabled tools like StudentHub from Element451 also provide early alert systems to flag advisors when a student might be struggling academically or emotionally, triggering proactive outreach and support.

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Student Information Systems: SIS platforms enhance efficiency in understanding retention information with real-time dashboards and reports. These systems give faculty and administrators quick access to key metrics like attendance and academic performance—essential for keeping tabs on retention.

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Benchmarking and Comparative Analysis: The National Center for Education Statistics provides the Integrated Postsecondary Education Data System (IPEDS), which collects data from postsecondary institutions on enrollment, graduation rates, finances, and more. They also host College Navigator, a tool that offers detailed information on over 7,000 institutions, including retention and graduation rates, allowing for direct comparisons.

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Challenges in Achieving Good Retention Rates

Keeping students enrolled, especially during their first year, is one of the toughest challenges colleges and universities face. Many first-year students grapple with academic, financial, and personal hurdles that are beyond an institution’s control. Here’s a look at some common obstacles and strategies to address them.

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Diverse student needs: Institutions often struggle to provide resources that are both broad enough to serve a large population and specific enough to address individual circumstances. Offer personalized academic advising and inclusive support services, such as cultural centers and student groups, to help students feel represented and understood.

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Financial barriers: Rising tuition costs, coupled with limited financial aid and inflation, force many students to drop out due to financial stress. First-generation and low-income students are particularly vulnerable. Expanding need-based scholarships and emergency financial aid programs is the most direct solution, but you can also offer financial literacy workshops to help students manage expenses and understand their aid packages.

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Academic preparedness gaps: Some students enter college without the academic skills needed to succeed, particularly in areas like math, writing, and critical thinking. Bridge programs, free tutoring, writing labs, and study skill workshops can help close these gaps

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Mental health issues: College students face increasing rates of anxiety, depression, and stress, which can lead to academic struggles and eventual dropout. Expand access to mental health services, including free counseling and wellness programs, and train faculty and staff to recognize signs and guide students to the right resources.

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Underrepresented groups: Students from underrepresented racial, ethnic, and socioeconomic groups often experience feelings of isolation, bias, or lack of belonging on campus. Create mentorship programs pairing underrepresented students with faculty, staff, or peers with similar backgrounds. You can also promote initiatives with an equity focus, such as first-generation support programs or diversity and inclusion workshops.

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Balancing work and study: Many students, particularly adult and part-time learners, must juggle academic responsibilities with part-time or full-time jobs. Provide flexible course options, such as online or hybrid classes, and evening schedules. You can also offer on-campus job opportunities to reduce commute times and schedule conflicts.

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Conclusion

Improving retention rates requires a holistic approach that prioritizes the well-being and success of students. Institutions must invest in proactive measures, from financial aid to mental health resources, while also fostering a campus culture that embodies inclusivity and support. 

Ultimately, the right mix of solutions depends highly on the unique circumstances of your students and institution—and you’ll need data and on-the-ground insight to determine this. A healthy retention rate is a sure sign of a healthy institution, but it is also the best way to ensure more students not only stay but thrive.

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Frequently Asked Questions

What's the difference between persistence and retention?

A persistence rate measures the percentage of students who continue their education by returning to any institution for their second year. A retention rate is the percentage of students who return to the same institution from one year to the next. 

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What is the difference between attrition and retention in higher education?

Retention refers to the number or percentage of students that return to school while attrition refers to the number or percentage of students who did not return.

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Why is retention rate important when you are considering colleges?

Retention rate is important when considering colleges because it reflects how well the college supports and engages students, indicating a greater likelihood that you will succeed and graduate from that college.