November 18, 2025

Private enrolment plunges as students pay for state places

Enrolments in Indonesia’s private universities have fallen by 28% this year, according to data from Indonesia’s Ministry of Higher Education, Science and Technology.

This comes on top of declining applications over the past three years, in part due to new routes into coveted state university places and the emergence of digital platforms offering skills training over short periods and at lower cost.

The downturn in private university enrolment is having a serious impact on higher education in the country.

Approximately 80% of Indonesian students study at private universities, according to the Association of Indonesian Private Higher Education Institutions (APTISI). Data from Indonesia’s Statistics Bureau shows there are 2,982 private universities and 125 state universities in Indonesia.

In 2023 and 2024, 23 private universities closed down. This year, 80 private universities are threatened with closure for failing to meet accreditation requirements, including lack of students and permanent lecturers, as well as poor facilities, according to APTISI and the ministry.

Willingness to pay

The growth in state university enrolment of new students through the so-called Jalur Mandiri, or independent channel, has contributed to the decrease in applicants to private universities, according to Desi Sommaliagustina, senior lecturer at Andalas University, Padang, West Sumatra.

The ‘independent’ routes allow admission to non-subsidised places at state universities which demand fees as high as their private university counterparts.

“This [independent] channel enables university applicants to be admitted to state universities without sitting the national exam, on one condition: willingness to pay the required amount for admission,” Desi was quoted as saying on 13 October by local media outlet Kompas.com.

Achmad Nurmandi, rector of Yogyakarta Muhammadiyah University, said diminishing interest in private universities is causing these universities to collapse.

“In Yogyakarta, 12 private universities closed down this year,” he told the local Jogja Insight on 18 October. “The jalur mandiri route opened by state universities really affects us,” he added.

While private universities enrol a much larger proportion of Indonesia’s higher education students, they receive only 5% of the state budget allocated to education, Dr Ricky Agusiady of the Association of Indonesian Private University Organizing Bodies (ABPPTSI) told University World News: “Things will get worse because there is no restriction for state universities in opening up new classes and recruiting new students through jalur mandiri.”

“We are told to be competitive universities. But without a fair budget allocation and a restriction of state university expansion, it turns out to be a one-sided competition,” he said.

Economic conditions

Sommaliagustina said the willingness to pay for education at state universities is fuelled by students’ pursuit of institutional reputation and brighter career prospects, as job opportunities for state university graduates are better than those for graduates of private universities.

The economic impact on families of the 2019 to 2022 COVID-19 pandemic continues to be felt in Indonesia. Parents want their children to get a job immediately after graduating from senior high schools or to pursue vocational courses that give them job skills within a shorter time, she pointed out.

The cost of education to families has become the main reason for the dwindling number of applicants to private universities, agreed Muhammad Arif, an education analyst at Syarif Hidayatullah Islamic University, a public institution in Jakarta. This has followed a new workplace trend for skills that do not require a university certificate, he said.

A characteristic of the current generation of students, often labelled ‘Gen Z’, is that they seek out study programmes that offer immediate skills, Arif noted. “They are not interested in theoretical studies like physics or philosophy,” he said.

“If they acquire a skill, he or she will get a job because more and more companies no longer require degree certificates,” he added.

Arif pointed out that digital learning institutions have become an alternative, lower-cost option. The emergence of digital learning institutions such as bootcamps, online courses, and certified training has made private universities less attractive, he told University World News.

“A big shift is happening now in the fields of work and education – from conventional to digital work and learning. The government is being challenged to adjust the higher education curriculum to the current trends of this generation.”

Financial impact on private universities

This leaves private universities struggling with conventional and costly ways of teaching. At the same time the government wants them to be financially independent. Government-sanctioned operational assistance for higher education mostly goes to state universities that are already financed by the state budget, Arif said.

A private university needs at least 5,000 students to carry on; with less than that, the university would go through hard times, according to Agusiady.

“Fewer students mean less revenue, while lecturers in private universities carry the same [teaching] burden as their counterparts in state universities. In many cases, it is even heavier. They teach, do research and write papers for academic journals. Many of them leave their university,” he said.

Without immediate measures by the government, things may get worse. There will be no academic regeneration in private universities, Agusiady said. “Then the nation will lack intellectuals and thinkers.”

Sommaliagustina also explained that a number of local private universities attempt to survive by lowering tuition fees, but they fall into a downward spiral as they still have to pay lecturers’ salaries, utility bills and other expenses that never decrease. “If it’s not the universities that are closed, classes are,” she added.

Private university lecturers are particularly vulnerable, she told University World News.

“They don’t have pensions and the other allowances that their counterparts in state universities have. Those who still teach in private universities do not do so mainly for an income, but because it is a moral calling,” she noted.

House of Representatives member Lita Machfud Arifin called on the higher education ministry to set a limit on the number of students admitted through the jalur mandiri channel.

“There should be a maximum number of students to be admitted through jalur mandiri to keep private universities playing their significant role in the country’s higher education,” she told the media in Jakarta on 20 October.