I recently reposted a link to a keynote speech that I delivered at the Distance Learning Administration Conference in 2013. The original speech was Online Disruption, MOOC Mania, and Change in Higher Education. I thought it might be useful to provide commentary on the more notable sections of the speech. The commentary is italicized. The original is not.
Over the past 20 years, enrollment in higher education increased to an all-time high of approximately 21 million students in Fall 2010 and 2011. More high school graduates are attending college than ever before.
In the fall of 2021, total undergraduate enrollment was 15.4 million. Between fall 2010 and fall 2021, the enrollment decreased for:
- American Indian/Alaska Native students (by 40 percent, from 179,100 to 107,000)
- Pacific Islander students (by 29 percent, from 57,500 to 41,000)
- White students (by 28 percent, from 10.9 million to 7.8 million)
- Black students (by 27 percent, from 2.7 million to 1.9 million)
During that same period, enrollment increased for:
- Students of Two or more races (by 126 percent, from 293,700 to 663,100)
- Hispanic students (by 30 percent, from 2.6 million to 3.3 million)
- Asian students (by 7 percent, from 1.0 million to 1.1 million)
In 2022, approximately 45 percent of high school completers enrolled in four-year institutions and 17 percent enrolled in two-year institutions. The four-year rate was higher than the 2012 four-year rate of 37 percent.
The percentage of first time, full time freshmen who complete their degree in four years is 37.9%, increasing to 58.3% in six years.
44.1% of this group who started in 2015-16 completed their bachelor’s degree in four years.
The percentage of all college students who conform to the traditional definition of full-time 18-22-year-olds is less than 40% of all college students. Many are working adults (over 25 years old) who are earning their degree as a part time student.
Cost of College
In addition to higher overall enrollments, the average traditional student taking longer to complete college, and many non-traditional students attending college; the cost of college has become a major issue. The increase in the cost of attending college has outstripped the increase in annual earnings of the average family by 83% for families in the middle 20% over the past 30 years according to The College Board.
According to the National Center for Educational Statistics, the average tuition and fees have decreased at all sectors of higher education since 2012 when measured in constant 2022-23 dollars (see table below). The same cannot be said for the cost of room and board, on and off campus. In fact, room and board costs have skyrocketed at many public universities.
Student Loans Continue to Increase
The average student who graduated from college in 2012 accumulated approximately $23,800 in student loan balances, and that number continues to increase.
Average student loan debt for bachelor’s degree recipients was $29,400 in 2021-22.
Even worse, from an administrator’s perspective, borrowing money to attend college is no longer ignored or as casually cast aside as it once was. How many times have you heard people say, “as long as you graduate from college, you’ll be able to repay your student loans”?
With student loan balances above $1 trillion and exceeding total credit card debt, the student loan issue is front and center.
The current student loan balance exceeds $1.75 trillion. In 2020, President Biden made a campaign pledge to erase $10,000 in student loan debt for all Americans. As many know, he hasn’t had support in Congress to erase student loan debt. Most Americans never went to college, never borrowed student loans when attending college, or repaid their student loans. Student loan forgiveness won’t be received well in many Congressional districts.
Bachelor’s graduates’ salaries and employment
Salaries for freshly minted college graduates have flattened since 2007. Flatter salaries create a lower return on investment for most grads, particularly those who borrowed to pay for college. Recent statewide surveys in Texas, Virginia, Colorado and Tennessee by College Measures indicate that graduates with a two-year technical degree in those states earn more than graduates from four-year degree programs.
Over the past decade, median income for recent bachelor’s graduates reached $60,000. Even more notable, all net job growth over the past decade has gone to bachelor’s or master’s degree graduates.
Also, since 2007, the percentage of recent college grads who are unemployed has increased, creating increased pressure on the sector from politicians, policy makers, parents, and graduates.
A 2013 Inside Higher Ed survey of parents indicated that 38% of respondents stated the most important reason for their children to attend college is to get a job. In addition, 34% were likely to restrict their child’s choice of college based on tuition.
Over the past four years, the job market heated up for recent college graduates and cooled this past year with the new pace of hiring for professionals and business graduates slowing to a rate not seen since 2009.
Last year, a survey of parents indicated that almost 70% would support their child entering the workforce after graduating from high school. The rising cost of college and the burden of student loans is blamed for the shift in confidence.
Illustrating the generational differences in thinking about higher ed, 88% of 2012’s college freshmen responding to a UCLA HERI survey believed that college attendance is mandatory for a better job. Evidently, those of us who are parents have a higher tendency to think of education and the acquisition of knowledge as a reason to attend college whereas our children are looking for employment.
Finally, if there ever was a disconnect between college presidents and employers, you don’t have to look any further than the data from a Chronicle of Higher Education 2013 survey. Evidence points to a huge disconnect between college presidents and employers. Nearly 54% of presidents believe a bachelor’s degree has increased in value since 2005. Only 33% of employers surveyed believe the value of a 4-year degree has increased during that time. Of course, that wouldn’t be the first time that college presidents were out of touch with reality.
College presidents’ attitudes have shifted since 2013. In a recent Inside Higher Ed survey of College Presidents, 66 percent expressed concern about waning public confidence in higher education. The presidents cited the top reasons for public skepticism as:
- Affordability (36 percent)
- Concerns about workforce preparation (27 percent), and
- Perceived ideological bias (16 percent).
Online courses
Over the past 20 years, the number of students taking online classes has increased exponentially moving from 11% of all college students taking at least one course in 2003 to 32.7% in 2012. According to the most recent Sloan Consortium survey, nearly one third of all college students (6.7M) took at least one online course in the most recent year and it’s likely that students taking at least one online course will reach 10 million in the not too distant future.
Eduventures is an organization that attempts to calculate students who only attend college through online degree programs and estimates that number to be approximately 3.2 million in the most recent year with nearly 24% of all adult college students estimated to be enrolled in fully online degree programs. The percentage is increasing.
The pandemic is credited for increasing the percentage of college students taking online courses. In the fall of 2021, 9.4 million students (61% of all undergraduates) were enrolled in at least one online course. Approximately 4.4 million students (28% of all undergraduates) were enrolled exclusively in online courses.
You don’t have to be a cost accountant to think that online courses should be able to lower the cost of education. Yet during this 20-year period of rapidly increasing adoption of online education, the exact opposite has occurred. Why? Because many institutions added online courses, not programs, to a standard, high fixed cost traditional model of higher education.
The situation has not changed much since 2013. In one study, the cost per credit hour of online courses at a public institution for an in-state student is slightly more than the cost of in-house instruction even though an online student should be able to save room and board costs by living at home.
Some traditional institutions chose to create online master’s degree programs to avoid the turf wars online courses could create with their undergraduate faculty. These institutions were able to keep pricing of the online and on-ground master’s programs relatively the same.
Until the last seven or eight years, many of the successful 100% online undergraduate programs were established by for-profit institutions. The for-profit institutions’ programs were priced between public institutions and private colleges. Pricing decisions were made based on the perceived market positioning and not the cost of operating through technology.
However, if you operate online only, there are some obvious traditional college operating expenses that can be eliminated. After all, if a student can live at home and a faculty member can teach from home, the physical plant costs are substantially lowered. Online instruction requires no physical classrooms or laboratories. There is no need for cafeterias, student centers, or dormitories. An online college will need fewer parking lots, less security, no athletic teams, no athletic facilities, no coaches, and no athletics compliance staff.
Students don’t have the benefit of these facilities or services, but they shouldn’t have to pay for them either. Pricing has been one of the differentiators we have used at APUS. We chose not to take higher undergraduate tuition for the past 12 years and allowed our students to receive the financial benefit from lower costs.
(Tuition at APUS for undergraduate active duty servicemembers continues to remain the same at $250/credit hour as it has been since 2001.)
Our thinking has been that students who have a positive and affordable online experience will share that story with others. As a result, over 40% of APUS students indicate that they heard about our school from another student or a faculty member. That in turn reduces our marketing costs.
Most of the purely online institutions have been able to find efficiencies in administrative expenses by increasing enrollments. To keep tuition lower, they have automated many back-office processes. With these initiatives, they have effectively taken advantage of scale.
Technology investments increased to scale online operations
Online degrees have made education convenient for working adults who couldn’t or didn’t want to travel to a physical campus. Campuses have invested billions of dollar in technology to enable the successful scaling of online higher education. Some of the technology developed is proprietary but most of it is available to all institutions.
Institutions and companies serving the online sector have invested in:
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Because all our courses are online at APUS, we implemented all these systems and more. If we had not implemented them, we would not have scaled our enrollment to its current levels while holding tuition flat. We would also not have been able to serve our students as effectively and efficiently as we have.
The bulk of investment and development in these systems and automation at APUS has occurred with the non-learning processes. This parallels most of the institutions offering online programs that I am familiar with as well..
Much of the reason for this was related to a lack of traditional systems designed to accommodate online students. Another reason was that politically, at most institutions, it was easier to justify and implement automated systems for the non-teaching functions.
Cutting staff positions that had been automated was easier to do than adjusting teaching assignments. It was evident that there wasn’t enough data available to determine the most effective online teaching styles, ratios, etc.
With all the systems implementations to allow online programs to scale, you would think prices would have flattened out. That hasn’t happened. Why? At institutions that offer online classes along with residential classes, the tuition is usually the same. Why? Because the business models are not designed to work together very well.
While many traditionalists disagreed with some of the writings of Clayton Christensen and Henry Eyring in their book, The Innovative University, I thought the authors’ most understated piece of advice to traditional colleges was: build and maintain your residential model at an optimal cost level in order to break even and build an online model that is priced incrementally instead of fully-loaded.
Christiansen and Eyring pointed out that the costs of running an online university are approximately half of that of running a traditional university. I wonder if that’s why the American Bar Association doesn’t accredit online law degrees? (The ABA now allows law schools to offer up to 50% of its courses online. If a school wants to offer a higher percentage, it must apply for an exception.)
More law students at a lower price equals more attorneys earning less. Perhaps that’s why accredited law schools have seen enrollment declines the past three years. It’s estimated that applications will decline approximately 13% for enrollments this fall. Law school is too expensive.
A New Economic Model Should Evolve
At the end of the day, the survivors of this technology disruption in higher education will be those who figure out a working economic model. Designing a working model won’t be easy for some of the following reasons.
Buying online classes is becoming cheaper and cheaper. So is building them if you’ve invested in technology and people infrastructure. Burck Smith, founder of Straighterline, has evangelized for years that the cost of teaching an online course was much cheaper than what colleges were charging for on ground courses.
The math is relatively easy. If annual tuition charged is $24,000 for 10 three-semester hour courses, that equates to $2,400 per course. If an online provider like APUS charges $750 for a three-semester hour course, they’ve eliminated many of those fixed costs mentioned earlier. In many cases, online faculty can teach more classes because the set-up time is less with an asynchronous course.
Straighterline’s model ignored faculty initially, providing tutor assistance for self-motivated learners. More recently, Straighterline offered an option to have an instructor-led course for an incremental cost of $100/course.
There are certain courses that set themselves up well for massification, in my opinion. Primarily, these are general education courses like English composition, College Algebra, Beginning Calculus, Introduction to Psychology, etc. Ignoring the need for remedial education, why shouldn’t the general content for these courses be the same?
If you operate a large state system like California, Texas, North Carolina, and Florida, why shouldn’t you lower your cost of education by building standardized online courses for half a dozen or so general education courses. What would the cost reduction be related to physical facilities alone? According to Christensen, the cost of operating online is half of face-to-face. I believe him.
While there are some state systems that have built online general education courses and offer them through OER consortiums, I believe the biggest savings for public higher education costs since 2013 has been the increased participation in dual enrollment courses. Public high school students enrolled in courses at their community colleges or high school courses certified for college credit by the local community colleges have increased to 1.94 million as of fall 2021.
MOOCs
It’s almost impossible to find a day when there’s not an article about the latest rage, MOOCs. Former University of Massachusetts Chancellor Dr. Jack Wilson’s had a great response to the MOOC trend. At last year’s Sloan Consortium kickoff keynote he stated, “you would think we haven’t been doing anything in online learning for the last 20 years based on the publicity the MOOCs are generating. Isn’t that amazing.”
The popular form of MOOCs bears little resemblance to the original version created by Canadian academics. They’re massive in terms of numbers of students enrolled. Most MOOCs are recorded lectures by rockstar professors. The lectures are sliced into 4–6-minute segments to keep the viewing attention of students. There’s little to no interaction between the professor and the students. MOOCs are currently being offered for free.
The institutions that have built the courses aren’t being altruistic. They haven’t figured out the business model yet. However, ACE has reviewed five of the Coursera MOOCs and has recommended college credit for those who complete the courses with a passing grade. Some colleges including mine have agreed to accept the ACE recommendations for students who complete the course and take a proctored final exam.
Ultimately, it is up to each degree-granting institution to decide whether to accept credit for these courses. Sloan’s “Changing Course” report indicates that Chief Academic Officers are not entirely sold on the legitimacy of MOOCs. Only 28% of CAOs indicate that MOOCs are a sustainable method for offering courses.
Regardless of Chief Academic Officer and faculty expectations, Coursera recently announced a deal with 8 or 9 state systems to either offer their courses to students at those institutions or offer their platform for institutionally designed MOOCs.
The details are a little fuzzy, but my guess is that the larger state institutions will lease the platform and develop their own MOOCs. This assumes that they’re committed to the idea of offering lower cost, online classes.
What hinders the adoption of MOOCs for general education courses at many institutions? One reason is that gen ed courses contribute significantly to margins through the usage of large lecture classes with grad teaching assistants. Another reason may be arrogance – why should my institution use the same Calculus textbook as your institution?
Measuring Learning in Self-Paced Courses like MOOCs
The biggest reason why MOOCs are NOT the panacea for general education courses is that they’re not designed to maximize effective learning outcomes. In December, my colleague Dr. Jennifer Stephens Helm and I co-authored a piece for the monthly viewpoints of the National Institute for Learning Outcomes Assessment entitled “Why Learning Outcomes Assessment is Key to the Future of MOOCs.” Essentially, we argued that until data is available about how much a student learns from the course, the value of that course is unknown.
Most online classes have been taught like a traditional class, including MOOCs. Technology has only recently been used to assist learning but holds the potential to improve learning. Using a digital classroom, every interaction can be recorded and measured.
My colleague, Dr. Phil Ice, and I participated on a panel at the Sloan Emerging Technologies Conference in San Jose a couple of years ago. In response to a question from a Chronicle of Higher Education reporter, Phil noted that “in its basic form, the data from an online classroom is similar to the data from a retail transaction on Amazon.com.”
Amazon (and others) can mine data to determine the buyer’s preferences. Why can’t educators mine the data from a classroom in a similar manner? Capturing online classroom data can help determine a student’s learning style. The instructor can personalize teaching to enable that individual to complete the course and the program
The ability to shift the directional focus of the instruction based on the student’s action(s) is increasing rapidly. One example is utilizing innovations like the Open Learning Initiative(OLI) classrooms developed at Carnegie Mellon.
OLI courses utilize Artificial Intelligence to focus on the area where the student needs guidance and reinforcement in assignments until the material is mastered. It’s one of the first examples of personalized or adaptive learning, one of the latest buzzwords for a theoretical course objective enabled by technology but implemented in very few online courses today. It won’t be the last example.
A year ago last month, the Gates Foundation convened a group of technology leaders from a dozen or so institutions to discuss the future of personalized or adaptive learning. From that meeting and others, a report was ultimately produced by Education Growth Advisors that looked at 70 companies offering adaptive learning products.
With that many companies offering adaptive learning products, not all will survive. At the same time, the competition for market share will motivate the companies with the strongest financials to enhance their product to meet or exceed the current expectations of customers.
As noted in an April 4, 2013 Inside Higher Ed article by Paul Fain, the group attempted to define adaptive learning as “adaptive learning takes a sophisticated, data-driven and in some cases, non-linear approach to instruction and remediation, adjusting to a learner’s interactions and demonstrated performance level and subsequently anticipating what types of content and resources learners’ need at a specific point in time to make progress.”
I highly recommend reading the Education Growth Advisors’ report for a thorough overview of adaptive learning and ways in which institutions and vendors are thinking about technology enhanced learning beyond today’s versions of online courses. The report has many useful exhibits including this one where they grouped 8 of the 70 adaptive learning vendors identified and the segment of education that their product is designed for.
One of the vendors identified in the report is the Carnegie Mellon OLI. The researchers developing those courses believed that one instructor for 200 students is a reasonable ratio for leading the online courses that they’ve developed.
One of the reasons that a 200:1 student to instructor ratio is possible is the automated learning pathways that the adaptive learning tool guides the students through. An instructor becomes a guide and interventionist.
At the same time, many institutions have capped their online enrollments at 20 or 30 per class, citing best practices in engagement between faculty and students. Whether it’s 20 or 200, that’s a long way away from 100,000 students that may be enrolled in some of the largest MOOCs.
If you agree with me that the contents of many general education courses are generic, then why should the price of access be high? Why not use OLI courses? Why not have a state or a private foundation pay CMU, Stanford, or others to develop an OLI to personalize the learning and help the students maximize their learning? If we can do this, we can lower the cost of the first two years of college. Granted, it isn’t the same experience idyllically described by many, but that experience is getting more expensive and out of reach for many.
It will be interesting to see how the San Jose State University project with Udacity offering three introductory math MOOCs for approximately $150 per class works out from a learning outcomes perspective. The cost is approximately one fifth of the normal cost per class for a student. It will also be interesting to see if faculty override the Coursera deal with eight or nine state systems, or if the project will be successful in lowering the cost of courses at those institutions.
Coursera is an example of massive learner enrollments at scale. In 2021, 92 million learners registered with Coursera and took 189 million courses. Twenty million learners taking 39 million courses were from North America. The remainder were from around the world. Coursera has 175+ university partners who provide 4,400 courses and 33 degrees. Coursera has also become a major player in the skills training arena providing 6,500 institutions with skills courses.
Competency Based Education (CBE)
Another topic getting more and more play in the higher education press is competency-based learning. While it’s arguably been around for 50 years or so, it’s being discussed more and more for several reasons. The first reason is that the changing demographic of college students is moving from the 18-24 age range to adults over 25 years old. Most adults are unable to attend college full-time, and life gets in the way of many successfully completing college.
Current estimates are that 42 million Americans have completed some college and have dropped out. Providing recognition and college credit for college level learning on the job or through other experiences shortens the time for degree completion for our adult learners and allows some to earn credit for their years away from college while working.
Allowing online competency-based courses also eliminates the clock hour requirement currently required by the Department of Education and allows students with exceptional academic skills to complete courses as fast as their abilities and time allow.
However, a 2018 Eduventures survey of Competency-Based Education (CBE) found that few programs enrolled more than 50 students and even fewer were able to demonstrate economies of scale. Program start-up costs and Federal Student Aid regulations were cited as two of the primary reasons blocking large scale enrollments.
Partnerships between universities and corporations where on the job training and learning are evaluated for academic credit enable the corporation’s employees to complete their degrees quicker and at a lower cost as well as recognize them dually for workplace and college level accomplishments.
One example of a partnership like this is APUS’s partnership with Walmart, where approximately 180 different job positions were evaluated for learning through a thorough review by faculty teams examining the corporate training and on the job experiences of retail employees and managers as well as transportation and logistics managers.
Implementing programs like this is a lot of work, and careful planning needs to be done to document application of credit to learning. I am sure that there are more of these in process at multiple institutions and many more to come.
If the cost of the first two years of college decreases for many students and successful colleges partner with corporations to leverage on the job learning with academic learning, what will or should differentiate colleges and universities offering the remaining two years of four-year baccalaureate programs? What happens to a non-elite, small, residential four-year college that is unable to adjust its fixed cost structure?
Institutions that focus on the relevance of the curriculum/degree programs offered, the quality of their teaching, the relationship with employers and placement for jobs, and the ability of graduates to attend quality graduate schools should win out.
Colleges that Can Scale Enrollments Can Also Lower Costs
However, the ability to increase tuition annually with little consideration to the consumer is gone for many colleges and universities. And that leads me to the economic disruption that is about to occur. If technology enables lower costs for the first two years of college for many students, value is created for the student, but not for the institution.
Remember the two basic principles of economics: supply and demand. If every institution begins to offer online courses and programs as part of their strategic plan to bring in additional tuition revenue, excess capacity will be created. I suggest that it already exists. I believe any of the four institutions with over 80,000 online students could double its enrollments with little difficulty and little need to build additional buildings like traditional institutions need to expand.
None of the top four institutions in terms of online enrollment has a brand and reputation as strong as any of the elite institutions participating in Coursera and EdX. What if one of them breaks from the pack and begins to offer accredited degrees at low cost?
Georgia Tech just announced a $7,000 degree, a Master of Science in Computer Science. Their intention is to attract 10,000 students which is five times more than they’ve graduated from their residential program over the past two decades. Will all those graduates be hired? Who knows?
If there’s excess capacity, prices are likely to fall. Falling prices should benefit those who cannot afford higher education. However, for some individuals, attending college creates an opportunity cost to their families, depriving them of another wage earner. Others may not have had adequate academic preparation for college due to substandard school systems, lack of mentors, or both.
There may not be enough qualified demand to meet the excess capacity generated by technology. At the same time, institutions offering technology assisted personalized learning courses for educational remediation and college preparation may be able to create a niche market, if offered at the right price point.
Are Online Graduate Degrees a Panacea?
If colleges think that moving up the ladder to offer graduate degrees is a panacea for the shrinking tuition dollars, they should apply the same market analysis that they would employ for expanding their undergraduate programs. I agree that more and more, a graduate degree is becoming the differentiator with employers who are looking for a college-educated employee.
A recent article (May 25) published in The Washington Post written by Nick Anderson points out the rapid increase in the number of master’s degrees granted by American colleges and universities with a 63% increase from 2000 to 2012, 18% higher than the increase in bachelor’s degrees. Perhaps more significant was the statistic that Georgetown University, George Washington University, and Johns Hopkins University now graduate more master’s students each year than undergraduates.
Were any of you aware of this? Is this part of a broader trend with elite colleges, not just those in the Washington/Baltimore area? While expanding undergraduate enrollments may not maintain the exclusive image that elite universities desire, it appears from this small sample that elites may be expanding graduate enrollments and, in the case of Georgia Tech, are willing to consider big increases in graduate enrollments if admissions standards and academic quality standards can be maintained.
Final Remarks
In good conscience, I want to preface my conclusion with a couple of comments. First, I am a glass half full type of person, Myers-Briggs ENTJ classification. Second, I have always been an active proponent of change whenever quality and or cost will benefit. That activism goes back to my days as a PWC consultant, and during 16 years as a healthcare executive.
That said, higher education is beyond the tipping point, and technology is accelerating change. While Internet usage and growth seems flat here in the United States, worldwide growth was 8% last year. Much of that growth is in emerging markets and I would suggest that there are opportunities for U.S. institutions to market to those countries if they offer reasonably priced online programs.
Accelerating at a faster rate is the acceptance of mobile technology, currently at a 15% annual growth rate with increasing numbers on its growth curve line. With the increasing integration of devices aided by the Internet, the numbers of users are exponentially increasing (as much as 10X) and costs are decreasing.
In many countries, the primary device for accessing the Internet is a smartphone. With more smartphones available than laptop or desktop computers, citizens of these countries may choose the online course or program provider whose courses are designed for mobile devices.
Recently, I saw a statistic that 68% of America’s high school seniors access the Internet predominantly through their smartphones. If you want to know how the increasing numbers of users are influencing content, check out this slide. Higher ed would be wise to pay attention.
On the good news side, all the content being added to the world’s knowledge base through increasing devices and access will require people of intellect to navigate it appropriately. Not only is the technology lacking, but few people trust computers to select the appropriate answer for them. (note: this has changed in the last year or two with the advent of generative AI).
In the past, that role has been led by professors, and I believe the potential is there for them to lead the way in the future if they and their institutions understand that the expansion of knowledge access will not be at the same cost that a privileged few (worldwide) were able to pay in the past.
Similar to Jeff Selingo, author of College (Un) Bound, I believe that approximately 1,000 low enrollment, non-elite colleges will close here in the U.S. over the next 5-10 years because they can’t compete for students at today’s tuition levels.
According to a 2024 Wall Street Journal article, more than 500 private non-profit colleges and universities have closed over the past decade which is three times what the closures were in the prior decade. In addition, the pace of closures appears to be accelerating.
Technology can enable improved learning outcomes for entry level, general education, and remedial courses. It can also enable colleges to lower the cost of the first two years when MOOCs are developed for gen ed courses.
According to the Council for Adult and Experiential Learning (CAEL) website, America needs to increase its college graduates by 50.8% in order to return to the top nation status and be more competitive globally. We won’t do it with our existing price structure or by teaching everyone the same way we have for the last 800 years.
We’ll have to lower the cost of a college degree substantially. In addition, we’ll have to shorten the time to earn a four-year degree. Technology can enable both of these solutions if implemented appropriately.
There will be a few very big colleges who serve many students at low tuition rates, unless regulators or accreditors place caps on institutional sizes which would likely limit college access to the nation’s wealthiest students.
The number of people with graduate degrees will increase because those with means will attain additional degrees to be more competitive in the employer marketplace. While elite institutions may offer more graduate slots through technology, they’re unlikely to significantly lower their admissions standards, choosing instead to locate suitable candidates globally, probably through free MOOCs used as screening tools.
States will likely shrink the number of institutions that are taxpayer supported. Community colleges, medium sized universities, and for-profit universities will increase the number of partnerships with employers. Companies will choose partners with the ability to train and upskill their employees. Offering evaluations of training and upskilling courses to transfer to academic credits will be important.
Some of these partnerships will evaluate competencies either with large corporations or across a particular industry. Other partnerships will lead to referrals of working adult students as well as leads for career placements of graduates.
Market differentiation will be important; after all, there are only so many MBA’s or lawyers needed in society. The days of many colleges filling expensive college seats with a promise of a job are over. Elite institutions will promise access to connections. The least expensive institutions will offer a greater chance at an ROI even with a lower salary..
Meanwhile, the surviving institutions will lead through some or all these attributes: differentiation, price/value, a blend of technology aided instruction, and corporate partnerships, blending technology with a flexible business model.
In 2005, my University of Pennsylvania dissertation chair, Bob Zemsky, co-authored a book entitled Remaking the American University: Market-Smart and Mission-Centered. While Bob and his co-authors were somewhat skeptical of online back then, much of the advice in their book can be applied to colleges and universities today.
Zemsky and his co-authors wrote “the key to making the academy more publicly relevant and mission centered lies in making it, ironically, even more market sensitive — or, to use the term that we have come to favor, more market smart.” The world is moving too fast for most colleges to rest on their past.. I suggest that all colleges and universities need to be market smart and to get there quickly.
I’ll leave you with one last thought. Workforce experts say that 7 out of the top 10 jobs 10 years from now have not been created yet. Their reasoning relates to the pace of technology innovation and its adoption by corporations.
What if colleges were so aligned with corporations and the workforce so that degree programs, concentrations, and courses could be changed on the fly. In that way, a graduate would be more prepared for open positions. He or she would not have to take additional courses and spend more time and money to prepare for the job market. It’s a market smart goal to aspire to.
Thank you.
Postscript
While I attempted to interject an updated fact or comment wherever appropriate for my 2013 speech, I believe that many of those comments are still relevant today. Some of the items that I did not include, either because they didn’t exist or were not on my radar screen include:
- Federal accountability regulations and reporting like Gainful Employment and The College Scorecard
- The impact of Artificial Intelligence (AI) on the workforce
- The increasing interest in short term credentials vs. degrees
- The top 10 colleges enrolling online students have increased their market share to 20% of the market according to a February 2021 McKinsey report
- Increasing attention to the fact that even graduate degrees may not pay off for students
- I never thought tuition discount rates would exceed 50 percent for private colleges
- The Impact of AI on Higher Education is unknown currently but is at the forefront of many conversations.
If I were asked to keynote a higher ed related speech for the same group of administrators today, it would likely look different. The key headlines are well-known.
Among those headlines are:
- The pending Demographic crisis,
- the number of institutions growing enrollments are far fewer than those with shrinking enrollments,
- the concerns of parents and students about the amount of student loans and the return of investment in time and money for a college degree,
- the increasing maize of government regulations designed not to protect consumers but to protect the status quo, and
- a scarcity of integrated and validated short-term workforce credentials that enable learners to obtain jobs.
And of course, no speech today would be complete without commentary on the impact of AI on higher education.
