This is for leaders – be it anyone in higher education watching the ground shift beneath them, anyone in organizations who needs to understand what determines recovery after collapse, or those who will one day depend on a Canadian university, which is to say, all of us. The example is specific. The lesson is not.
The Collapse We Didn’t See Coming – and What Happens Next
When any organization collapses, the public conversation turns immediately to the body count: how many jobs, how much revenue, how many programs, products, or locations are gone. Those are the visible losses, and they are real. But they are not what determines whether the organization recovers, or what it becomes if it does. That variable lives somewhere less visible: at the leadership table, in the quality of the culture among the people who have to make decisions together under pressure, often with fewer resources. This is a story anyone in leadership needs to pay attention to.
In January 2024, the federal government announced it would reduce international study permit approvals by 35%, sending shockwaves across Canadian higher education. A reasonable adjustment, by most accounts. The kind of policy correction that makes for a measured press release and a few cycles of sector commentary before the next news cycle arrives.
What followed was not a correction.
Approvals fell closer to 48%, overshooting the government’s own target by nearly 100,000 permits. Ontario was projected to see a 41% reduction. It saw 75. Every province without exception landed well below its intended target, most by a margin that doubled or tripled the forecast decline. The government did not overshoot its policy. It did not understand the system it was adjusting.
Across Ontario’s 24 publicly funded colleges, 23 reported a 48% decline in international enrolment. Over 8,000 jobs confirmed lost in Ontario alone, projections approaching 10,000. More than 600 programs suspended or cancelled. Four campuses closed. The sector has shed upwards of 12,000 positions nationally.
The word for this is collapse, not correction. Calling it a correction allows everyone involved to frame what happened as a policy that went slightly further than intended – and keeps the conversation inside a comfortable register. The harder conversation only opens when you use the accurate word. Because what collapsed was not just enrolment. What collapsed was a funding model that had been quietly hollowing out for two decades.
Provincial governments across the country, Ontario most acutely, had been withdrawing per-student funding for years while allowing international tuition to fill the gap. The province that now faces the deepest cuts had frozen domestic tuition since 2019 while its colleges built operating models on revenue that was, structurally speaking, one policy change away from disappearing. The cap didn’t create the dependency. It exposed it.
Many leadership teams had no experience operating without dependency on international revenue. The instinct was to cut hard, cut fast, and in many cases cut far too deep. Some administrative teams, exercising leverage they had never had before, did so with gusto. The result has been not only the decimation of Canada’s standing as an educational destination, but a crippling of internal capacity – faculty, programs, institutional knowledge – that may take years or decades to rebuild. The financial shock may prove easier to recover from than the human one.
And then there is what I call the ReOrg Echo – seldom discussed, consistently underestimated. It is the wave of attrition that follows an aggressive round of cuts. Faced with orphaned responsibilities, depressed colleagues, and eroded trust in leadership, many of your best people will quietly decide to leave. The institution that cut to survive finds itself understaffed for the recovery.
This raises the question your leadership team is likely living right now: why do some institutions absorb a shock like this and others fracture under it? Research on societal collapse and institutional regeneration, a field with growing relevance given broader social upheaval, has identified two variables that determine not just whether recovery happens, but what quality of institution emerges on the other side.
The first is institutional robustness: the degree to which an organization’s decision-making structures, internal alignment, and clarity of priorities were strong enough to absorb the shock without fragmenting. Institutions with functioning leadership dynamics, clear decision rights, and genuine coherence at the top fared better in the initial wave. They could act. Those without that foundation have spent the past year absorbing the shock while internal confusion compounds it.
The second is cultural innovation: the willingness and capacity to learn from what the collapse revealed, and to build something genuinely new, rather than simply restore what existed before. This is the variable that separates moderate recovery from excellent recovery. It requires leaders who can look honestly at what the crisis exposed, and act on it, rather than manage it back to comfortable invisibility.
Robustness determines whether you survive. Innovation determines what you become.
Most institutions will follow one of three paths. Some will decline. Some will recover. A few will emerge stronger. Which one depends almost entirely on what happens at the leadership table.
In the first, leadership reacts tactically – cuts, freezes, manages communications – while the leadership table fragments under competing priorities and unclear authority. The institution stabilizes on paper and continues to erode underneath. Jim Collins called this the Doom Loop. I’ve watched it play out. It doesn’t end well.
In the second, the institution restructures financially and achieves operational stability. But leadership never addresses what the crisis revealed: the misalignments, the ambiguous decision rights, the patterns that were quietly weakening performance before the shock arrived. They recover slowly and miss the lesson entirely.
In the third, the institution treats the collapse as a signal. Leadership gets genuinely clear – about priorities, about how decisions get made, about what they are building and how they will move toward it together. The robustness that carried them through becomes the foundation for the innovation that follows.
What distinguishes the institutions that take the third path is not speed – it is the deliberate refusal to let urgency drive the table. Pressure compresses thinking. Fear accelerates decisions that would never survive a calmer room. The leadership teams that absorbed this shock without fracturing were the ones that could hold the complexity long enough to make a considered choice – not because they had more time, but because their culture had built the capacity to manufacture it. As the saying goes, never waste a good crisis. The institutions that don’t will spend years recovering from decisions made in weeks.
The variable that determines which path your institution takes is not resources, reputation, or the severity of the hit you took.
It is the health of the leadership organization – particularly the unity, clarity, and alignment of the people at the table. Whether you can hold the complexity of the moment together without fragmenting. Whether you can learn from what the crisis revealed rather than manage it back to comfortable invisibility.
I’ve been in enough of these rooms to know that this capacity is rarely built in the middle of a crisis. It is built before one arrives – and rebuilt, deliberately, in the aftermath of one.
The capacity for recombination – taking what survived the collapse and building something more adaptive from it – lives or dies at the leadership table.
The institutions that figure this out in the next 24 months will define Canadian higher education for the decade that follows. The ones that don’t will spend that decade recovering toward a model that no longer exists.
