Where have the graduate students gone?

Applications to take the GRE are down and that means the number of graduate students is unlikely to rise, in contrast to the traditional pattern of greater graduate school attendance during recessions.  Here are a few hypotheses:

Stewart has several theories about why declines may be taking place
this year, despite historic trends. She said it was possible, as ETS
officials suggested, that the credit crunch was making it more
difficult for students to borrow – or that hearing about the crunch
discouraged some from trying. In that same vein, she said that with
many colleges and universities announcing budget cuts, many departments
may not have the same levels of funds to offer in fellowship support.

In addition, she said that while economic uncertainty in the past
has prompted some people to decide to improve their skills so they can
seek better jobs, the turmoil is so great this year that “no one will
leave a job if they have a job – they think the risk is too much to
take.”

Stewart also stressed that just because the surge in interest in
graduate school has not happened this year doesn’t mean it won’t start.
Many people these days are experiencing “freezing behavior” where they
are so uncertain about their next move and the state of the economy
that they aren’t making any changes, she noted. “It could be that this
has created a temporary pause where we would have normally seen a flow
to graduate school. That the flow hasn’t started doesn’t mean it won’t.”

I opt for paragraph #2.  How about all of you?  Are you in this position yourselves?