Private schools at peril

Xia Tao, who works for a private university in Shandong, said the shrinking student pool has threatened the operation of the school, which largely relies on tuition fees from recruited students.

Shandong ranks the second among Chinese provinces in terms of NCEE takers, but this year marks the third consecutive year for the figure to fall.

"Recruitment was already very hard, as private universities lack the public recognition of the public counterparts. Now it's like rubbing salt into the wound," said Xia.

Educational experts said that the reduced supply of students has brought a financial crisis to Chinese universities and colleges. Many private schools, due to their low rank and enrollment rate, are nearly forced into insolvency.

Deng Xiangchao, vice dean of the School of Art of Shandong Jianzhu University, said the low enrollment rate would also hit public universities that look to more students to pay the huge debts incurred by their expansion fever.

"The crisis is not necessarily a bad thing. It shows the public discontent of the declining quality of higher education and will whip universities into reforms," said Deng.

Chinese universities have been obsessed in building larger campuses since 1999, when the central government called for the popularization of higher education, and now it is time to catch up in quality, said Deng.