As far as all religious orders being in “decline”, we have to distinguish. If by decline your friend means the replacement rate is not keeping up with the death/attrition/etc rate, than perhaps he is correct. HOWEVER, the number of incoming, new vocations shows the vitality of any religious order/congregation/etc (we’ll just use “order” to refer to them all). So if we use the number of entrants to orders as an indicator of decline or growth, we see there are definite pockets of boom and some orders destined for inevitable death. I don’t like to use the terms “liberal” or “conservative” since we are discussing religion and not politics, but it appears the more traditional/orthodox orders are attracting more applicants, as the more progressive, less-traditional/orthodox ones are waning.
The Dominican Friars of the Eastern Province just announced their largest incoming class in 50 years—21 novices. The Dominican Sisters of St. Cecilia (the ones at St. Pius V in Providence) had 23 postulants in 2009—the largest group of nuns in training of any US group. The Dominican Sisters of Mary, Mother of the Eucharist were founded in Ann Arbor in 1997 by 4 Nashville Dominican Sisters. They now number 100 sisters with an average age of 26! No polyester pantsuits here.
The most successful institutes in terms of attracting and retaining new members at this time are those that follow a more traditional style of religious life in which members live together in community and participate in daily Eucharist, pray the Divine Office, and engage in devotional practices together. They also wear a religious habit, work together in common apostolates, and are explicit about their fidelity to the Church and the teachings of the Magisterium. All of these characteristics are especially attractive to the young people who are entering religious life today.God always provides for His Church!
Check this out for more info and examples.