Having recently finished studies and still being in contact with teaching assistants today, the problem is big. Attendance going down, participation going down, courses and curriculum simplified. I already noticed a big shift after Covid and I'm glad I missed the ChatGPT era.
Part of this problem is also because courses have (in my experience) rarely rewarded actual knowledge or understanding. In our efforts to standardise everything and come to objective exams, we've rewarded a culture that just intends to pass with the least amount of effort. Next to that are the burdens of being a student; if I didn't have to work most nights of the week, I'm sure I'd have put more effort into studying.
Lectures were often boring and questions would be answered by referring to pages in a textbook. Maybe with recorded media, we should revisit the use of lectures.
All in all, I don't see how academia can keep the standards high in current society. We'll see how it goes.