Like leg warmers and mullets, Bennington College seemed a candidate for oblivion a generation ago.

The school has long shined in the now out-of-fashion humanities. Its famous alumni include writers Donna Tartt and Bret Easton Ellis, not some hoodie-wearing tech billionaires. Tucked away at the foot of Vermont’s Green Mountains, it charges $73,000 a year. The college nearly went out of business in the 1990s and was still on its knees earlier this decade.

But Bennington and its more than 700 undergraduates are hanging on. It’s a testament to the staying power of the nation’s small liberal arts colleges amid a torrent of bad news about a deteriorating U.S. higher education marketplace. In particular, the near-death of Massachusetts’ Hampshire College, another school famed for its artsiness, has made many question small institutions’ future. Precious few, however, are going out of business.

“They’ve survived because they’ve been able to exploit what they’re good at, and that has enabled them to continue to attract students and retain faculty,” said David Bergeron, a former deputy assistant secretary in the U.S. Department of Education who specialized in higher education. “The threat of closure has brought a new level of energy.”

No doubt, the college business is challenging. News about the nation’s $1.6 trillion in higher education loans is discouraging students from attending. Democratic candidates for president have said they want public colleges to be free, which would make private institutions less attractive. The number of high school graduates is declining, especially in the Northeast and Midwest. Immigration restrictions threaten the steady stream of full-tuition paying students from China and elsewhere.

Last year, one-third of private colleges saw a decline in revenue from tuition, up from 15 percent five years ago, according to Moody’s Investors Service, which tracks the bonds of colleges.

The Council of Independent Colleges, a small-school trade group, estimates that 2% of its roughly 650 members are struggling financially. A dozen have closed or merged over the last four academic years. Just last week, Vermont’s Marlboro College said it would merge with the University of Bridgeport in Connecticut.

The U.S. Department of Education counts about 750 colleges with 1,000 or fewer students, compared with about 790 a decade ago -- hardly a higher education apocalypse. In 2013, amid the boom in online education, Harvard Business School Professor Clayton Christensen had predicted that half of all U.S. colleges would go bankrupt in 15 years .

Today, the most selective liberal arts colleges such as Williams and Amherst rank among the nation’s most sought-out and wealthiest institutions, relative to their size. But even those with weaker finances have found ways to keep operating.

In 2015, Sweet Briar College, a Virginia school for women whose former students include Jacqueline Kennedy Onassis’s mother, announced it was shutting down. Within three months, alumnae, who had hired a law firm to thwart the plan, raised almost $30 million.

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