I've read that more Americans start college than in other developed countries but that the fraction of college graduates is similar. This suggests that there are too many unqualified students attending college in the U.S., and if the declining enrollments are coming primarily from that group, it's a good thing.
Some people fail out of college because the work is beyond their capabilities, but I think a significant percentage of people who start college but don't graduate do so for reasons other than being simply unqualified.
I admit it's anecdotal, but very few people I know who started college but didn't finish didn't finish due to academic reasons.