Cutting Some Slack: The “College Bubble” Explained

huThere are several “inconvenient truths” contained among the details of a recently released synopsis of college education and work trends, courtesy of the Heritage Foundation. Let’s check them off one-by-one.

The Cost of College

This truth is likely known to nearly everyone  who has children: education at four-year educational institutions isn’t cheap.  Here are the average annual prices for higher education in the United States for the current school year (includes tuition, fees, housing and meals):

  • 4-year public universities (in-state students): ~$19,550
  • 4-year public universities (out-of-state students): ~$34,000
  • 4-year private colleges and universities: ~$43,900

These costs have been rising fairly steadily for years now, seemingly without regard to the overall economic climate. But the negative impact on students has been muted somewhat by the copious availability of student loans — at least in the short term until the schedule kicks in.

The other important mitigating factor is the increased availability of community college education covering the first two years of higher education at a fraction of the cost of four-year institutions.  Less attractive are “for-profit” institutions, some of which have come under intense scrutiny and negative publicity concerning the effectiveness of their programs and how well students do with the degrees they earn from them.

Time Devoted to Education Activities

What may be less understood is the degree to which “full-time college” is actually a part-time endeavor for many students.

According to data compiled by the Bureau of Labor Statistics over the past decade, the average full-time college student spends fewer than three hours per day on all education-related activities (just over one hour in class and a little over 1.5 hours devoted to homework and research).

It adds up to around 19 hours per week in total.

In essence, full-time college students are devoting 10 fewer hours per week on educational-related activities compared to what full-time high school students are doing.

Lest this discrepancy seem too shocking, this is this mitigating aspect:  When comparing high-schoolers and full-time college students, the difference between educationally oriented time spent is counterbalanced by the time spent working.

More to the point, for full-time college students, employment takes up ~16 hours per week whereas with full-time high school students, the average time working is only about 4 hours.

Full-Time Students vs. Full-Time Workers

Here’s where things get quite interesting and where the whole idea of the “college bubble” comes into broad relief. It turns out that full-time college students spend far less combined time on education and work compared to their counterparts who are full-time workers.

Here are the BLS stats:  Full-time employees work an average of 42 hours per week, whereas for full-time college students, the combined time spent on education and working adds up to fewer than 35 hours per week.

This graph from the Heritage Foundation report illustrates what’s happening:

CT

Interestingly, the graph insinuates that full-time college students have it easier than many others in society:

  • On average, 19-year-olds are spending significantly fewer hours in the week on education and work compared to 17-year-olds.
  • It isn’t until age 59+ that people are spending less time on education and work than the typical 19-year-old.

No doubt, some social scientists will take these data as the jumping off spot for a debate about whether a generation of “softies” is being created – people who will struggle in the rigors of the real world once they’re out of the college bubble.

Exacerbating the problem in the eyes of some, student loan default rates aren’t exactly low, and talk by some politicians about forgiving student loan debt is a bit of a lightning rod as well.  The Heritage Foundation goes so far as to claim that loan forgiveness programs are leaving taxpayers on the hook for “generous leisure hours,” since ~93% of all student loans are originated and managed by the federal government.

What do you think? The BLS stats don’t lie … but are the Heritage Foundation’s conclusions off-target?  Please share your thoughts with other readers here.

Higher education choices in America: A distinction without (much of) a difference?

The cost differential is huge. But what about the education itself?

13According to the College Board, the average annual cost of college, including tuition and books, varies widely depending on the type of institution:

  • Private colleges and universities: ~$31,200
  • Public colleges and universities (out-of-state residents): ~$23,000
  • Public colleges and universities (in-state residents): ~$9,100
  • Community colleges: ~$3,300

In fact, the difference between the highest and lowest cost averages comes out to a factor of ten.

Averages are more difficult to calculate for online college institutions, where the annual cost ranges widely from as low as $5,000 all the way up to $25,000 or so, according to The Guide to Online Schools.

With such a disparity in college education costs, one might think that public perceptions of the value of the degrees granted by them would likewise show differences based on the type of institution.

But a recently completed national opinion study tells us otherwise. A telephone research survey conducted in June 2015 by the Gallup organization queried ~1,500 Americans age 18 or over about their attitudes toward college education.

Among the most interesting findings is the perception of community colleges: Two-thirds of the respondents rate the quality of education that community colleges offer as “excellent” or “good.”

For four-year colleges, the percentage figure for excellent/good quality was only slightly higher: ~70%.

Considering the vast difference in the financial outlay required to attend a four-year school, community college education is looking mighty attractive, indeed.

Tempering this finding are the Gallup survey’s respondents who possessed advanced degrees themselves.  They’re more likely to rate four-year institutions higher than community colleges on quality (a nine percentage point difference).

And of course, community colleges do face challenges such as their track record on lower graduation rates, plus the sometimes challenging process and procedures in successfully transitioning students from two-year to four-year schools.

Still, the perception of near-parity in education quality is striking — and it’s not very different from the findings Gallup has observed since beginning to survey the American public on this topic two years ago.

I don’t doubt that some families will be sharpening their pencils and doing new cost/benefit calculations based on the results of this Gallup survey.

But where a perceived difference in quality continues to persist is in online education. Survey respondents were about half as likely to rate the quality of Internet-based college programs as “excellent” or “good.”

While respondents don’t fault online programs for lacking a broad curriculum, or even for the value provided for the cost of enrolling, online education is seen as lacking strength in three key areas:

  • Reliable testing and grading
  • The quality of instruction
  • The value of the degree to prospective employers

But there’s another way to look at it.  Internet-based higher education is slipping through the door and becoming “mainstream” not just because of the online programs such as those offered by Capella University and the University of Phoenix, but because of the burgeoning online coursework being offered by traditionally brick-and-mortar institutions.

With that growing practice, I predict it’s only a matter of time before the perception of online higher learning will match the higher ratings that are already being given to community colleges, public and private institutions.

Let’s see how things look in another five years.

Economic Reality Comes to College Campuses

Finally, colleges get schooled in Economics 101.

Sweet Briar College (1901-2015?)
Sweet Briar College (1901-2015?)

For a long time, “market forces” didn’t really apply to institutions of higher learning — at least not in the classic sense.

In a social environment where nearly everyone buys into the notion that more education is good, government and educators fostered policies where no one need be prevented from getting a college education because of lack of funding.

Accordingly, in the past several decades, loans and grants became easier to obtain than ever.

Unfortunately, one of the consequences of easy money in education was that tuitions rose at a faster rate than the economy as a whole.  After all, the third-party money spigot seemed never-ending.

For a good while tuition spikes weren’t a particular concern, because it still seemed as though a college-level education was a great way to earn substantially more money in one’s career — even if racking up student loans at the outset.

But in recent years, we no longer see an automatic positive correlation between a higher education degree and the ability to earn increased income.

In the sluggish economy of the 2000s, a college diploma in the right field may well be a good investment.  But with many college majors, oftentimes it isn’t.

The situation is even dicier for the many students who attend community colleges or four-year institutions but who never graduate.  The chasm between their educational loans and their earning power is even more deep.

Corinthian Colleges
Corinthian Colleges (1995-2015)

And for those students unlucky enough to attend for-profit institutions like those run by Corinthian Colleges, Inc., which is in the process of closing the last two dozen of its schools across the country, the situation is even worse.

Saddled with student debt, stuck with degrees or half-completed courses of study of dubious value, and with school credits unlikely to be transferred to other schools in order to finish their education, the situation for those  unlucky students can only be described as dire.

How did we get to this place?

One big reason is that over the years, many colleges got into the habit of simply expecting sufficient numbers of students to enroll in their institutions regardless of the sticker price to attend.  If anything, high tuition “list prices” were a badge of honor.

At the same time, substantial grants (essentially discounts off of the published tuition rates), together with irresistible financial aid packages, continued to attract students to private as well as public institutions of all stripes.

Running in parallel with this were lavish, ongoing projects involving the construction of fancy new dorms, state-of-the-art athletic facilities, and all sorts of other creature-comfort-like amenities to lure students to campus.

And let’s not forget another not-so-welcome outcome of this fantasyland of higher education economics – call it “degree inflation.”  With so many students obtaining undergraduate degrees, their “worth” became devalued.

In this high-stakes derby, a BS degree in business is no longer enough – it has to be an MBA.  A BS degree in engineering isn’t nearly as prestigious as a Master’s degree or a PhD.  There’s really no end to it.

The convergence of these sobering economic and social trend lines makes it pretty clear that the “old” business model is no longer working for colleges and universities.  With the economic realities of today, college administrators are discovering that, sooner or later, market forces work.  And the resulting picture isn’t very pretty.

So now we’re witnessing the lowest percentage increases in tuition sticker prices we’ve seen in years, across private institutions and even some public ones as well.  Bloated administrative staffs  — their numbers dwarfing the number of teachers at some colleges — have finally plateaued or even begun to decline.

Being the parent of two children who graduated from college within the past five years, naturally I’ve been quite interested in these trends – and I’ve viewed them pretty close-up.

What I’ve determined is that for years, administrators at many colleges and universities didn’t see themselves as working within a market system — having to compete where market forces were at work.  The often-unappealing business of being disciplined by market forces didn’t pertain to them — or so they thought.

That’s certainly not the case anymore.

And there’s another huge factor looming on the horizon:  Distance learning.  I’ll be here big-time before we know it … and it promises to upend the college education business model as never before.

What are your thoughts on this topic?  Please share them with other readers here.

Gallup: A prestigious college isn’t a clear ticket to career happiness or personal fulfillment.

collegesThe latest shoe to drop in the growing notion that a college education may not be all it’s cracked up to be comes in the form of a Gallup survey released this month that reveals that attending a prestigious institution of higher learning won’t make a person any happier in life or work when compared to graduating from a less selective one.

The Gallup survey of nearly 30,000 college graduates in all age groups, which was conducted in concert with researchers from Purdue University, asked respondents how they were doing in life across a range of factors such as income and “engagement” in their jobs.

Interestingly, the Gallup research was advocated by former Indiana Governor Mitch Daniels, now the president of Purdue University, who reported to The Wall Street Journal that he had encountered a lack of benchmarked data to measure the value of a college degree.

“There is a lot we don’t know about higher education, and there is a sense it’s skating on its reputation,” Mr. Daniels remarked.  “We needed to know with more rigor how well the experience is serving people.”

The resulting survey conducted by the Gallup organization found that fewer than 40% of the college graduates surveyed feel “engaged at work” — in that they enjoy what they do on a daily basis and are intellectually and emotionally connected to their work.

An even lower percentage – just 11% – thought of themselves as “thriving” in all of the major aspects of their lives such as financial stability, having a strong social network, and feeling a sense of purpose.

And how do graduates of the most “selective” institutions fare against others?  According to Gallup, there’s no discernable difference at all.

That is correct:  The survey found that graduating from a Top 100 school has no bearing on the level of future happiness or fulfillment in work or in life.

college debtWhat does have a big impact — in a negative way — is college debt.  Only about 2% of respondents who reported between $20,000 and $40,000 in student loan debt reported that they are “thriving.”

On the positive side of the ledger, what does seem to correlate with greater happiness and fulfillment is having had the experience of a professor take an interest in the student.  These teachers served as a mentor or helped make the learning experience exciting for the student.

The Gallup survey found that those kinds of experiences tend to translate into more optimism, curiosity and engagement in later life and careers — leading to greater fulfillment.

I have immediate family members who have attended all types of higher educational institutions — from Ivy League schools and “New Ivies” to private colleges, public universities and even community colleges.  Time and again, I’ve seen this phenomenon play out just as the Gallup survey suggests.

The fact is … broadly speaking, American higher education is quite good.  One can receive a good education almost anywhere, provided a student studies hard and takes advantage of the opportunities that are available (internships, work-study programs, exchange programs and and so forth).

It wasn’t so true a generation ago.  Back then, the prestigious schools had clear advantages in terms of their top educational staffs, great libraries, and worldwide connections in the educational and business communities.

Today, thanks to the Internet, distance learning and more people with PhDs, even the less selective schools have quality staffing, access to unlimited “virtual” library resources, and similarly stronger connections worldwide.

There continues to be a difference between the prestigious schools and the rest of the pack, of course.  At a place like Amherst or Williams, essentially all of the students are smart as a whip and highly motivated, whereas that’s not going to be the case at a state university.

But at all of the schools, the best students are actually very similar across the board … and they have similar opportunities available to apply to their advantage.

On top of this, there are many fields of study where the “best” education you can get isn’t going to be at an Ivy League school.  Think about the ag degrees at Iowa State University (Ames) or the structural engineering coursework at the Missouri University of Science & Technology (Rolla) as just two examples.

Bottom line, here’s where things stand:  If students want to learn and are willing to study hard … they can get a good education at pretty much any school they choose to attend in America.  And it will lead to a fulfilling professional and personal life later.  “Prestige” has very little to do with it.

A Surprise? College Students are Ambivalent about e-Books

College textbooks
Surprisingly, college textbooks still reign supreme over their digital counterparts.
The digital revolution is having its first and greatest impact on the younger generations. Whether it’s mobile apps, hyper-texting, online gaming, or keeping up on the news without the benefit of the daily paper, they’re the ones most on the cutting edge.

So it might be somewhat surprising to read the results of a survey of college kids about how they prefer to access their textbook information. I’ve blogged before about the racket that is college textbook publishing – a rip-off if ever there was one. So one would think that college students (and their parents if they foot the bill) would be very keen on any advancements that begin to render expensive textbooks obsolete.

But according to a survey conducted in mid-2010 by OnCampus Research, a division of the National Association of College Stores, only 13% of college students had purchased an electronic book of any kind during the previous semester.

And of that percentage, ~56% revealed that the prime mover of their e-book purchase was because it was required course material for class, not because they chose an available e-version over a printed version of the textbook.

What’s more, nearly three-fourths of the students in this survey stated that they prefer printed textbooks over digital versions.

And when it comes to what devices people are using to view their e-books, most are accessing the contents on laptop computers rather than newer devices that have hit the streets in recent times:

 Prefer reading e-books on a laptop computer: ~77%
 Prefer reading on a desktop computer: ~30%
 Prefer reading on a smartphone: ~19%
 Prefer reading on a Kindle or similar e-reader device: ~19%
 Prefer reading on an iPad or similar device: ~4%

Laura Cozart, a manager at OnCampus Research, had this to say about the survey results: “The findings of the report are not surprising. Every new innovation takes time before the mainstream population embraces it.”

Reflecting the current situation, of the NACS member stores that offer digital content, e-books comprise only ~3% of course material sales. But NACS is expecting that percentage to rise to 10% or 15% by 2012.

But the impetus behind that anticipated increase is expected to come from faculty members as they get more familiar and comfortable with the interactive possibilities to enhance their classroom instruction — rather than from those oh-so 21st Century students.

It wouldn’t be the first time the “leading edge” meets the “back edge” going around the other side.

College education in America: What the hey, let’s party!

The Five-Year Party, by Craig BrandonJust in time for the upcoming school year, a new book has hit the stores that launches a fierce attack against today’s college education in America. As a father of one recent college grad plus another daughter just beginning her sophomore year, The Five-Year Party: How Colleges Have Given Up on Educating Your Child, by Craig Brandon (ISBN #ISBN-13: 978-1935251804) caught my eye.

Brandon is a former education reporter and college writing instructor. What’s his main beef? That college administrators have taken advantage of government loan largesse and other programs to create a campus environment that’s hardly conducive to the disciplined intellectual labor of learning. The way Brandon sees it, college administrators are more interested in students’ pocketbooks than their intellects.

Brandon trains most of his firepower on liberal arts colleges, many of which he characterizes as “education-free zones” where quaint traditional notions of learning – like attending classes and doing assigned homework – have gone by the boards. He cites statistics that only ~30% of students enrolled in liberal arts institutions graduate in four years … and that fully 60% take six years or more to get their undergraduate degrees.

The book outlines the conditions that contribute to these sorry statistics. Extensive student loan and grant programs mean that few if any students ever pay the “book rate” tuition at a private college or university. This has made it easier for institutions to raise tuition rates far in excess of the inflation rate.

Brandon claims it has also led school administrators to tolerate – even abet – the extra years students spend on campus. After all, it’s more money for them to pay officials their lucrative salaries … not to mention bankrolling the country-club like student centers and new athletic facilities that seem to be on every college’s wish list.

And during that extended time on campus, it’s “party on!” Never mind the lower educational standards … it’s easier and far more lucrative for colleges to give students what they want, rather than what they need, to build meaningful careers afterwards.

And what about the instructors? They may well lament the decline in educational standards. But they’ve found out the hard way that to enforce rigorous educational standards in the classroom invites a flurry of negative reviews on student evaluation forms (that are easily accessible online) – reviews that are often linked to tenure and promotion decisions. It’s easier to go with the flow, provide reasonably entertaining lectures … and give out decent grades to all but the worst performers.

But what does this mean for those students who decide to work hard during their college years and to graduate on time? They may end up with a degree that’s devalued in the eyes of employers.

Moreover, the general decline in the value of a college degree affects even those schools that have tried hardest to maintain the traditional rigors of education that once characterized nearly all liberal arts schools – practices such as requiring students to take extensive coursework in subjects that go beyond their chosen field of study.

Colleges like Davidson in North Carolina, Hillsdale in Michigan and Rhodes in Tennessee may make studying and achieving top grades a huge challenge for their students … but their regional reputations mean that those degrees don’t carry much cachet beyond a 300-mile radius of the school.

Meanwhile, students who attend some of the nation’s better-known ivy league universities or “near ivy” institutions sail on through, cafeteria-style, taking only coursework that is easiest or of greatest interest to them.

Who’s the bigger chump then?

It’s a bit painful to read The Five-Year Party … and hard to finish it without feeling pretty depressed about the state of liberal arts education in America. Besides, does anyone know of a liberal arts school or university that has actually gotten a good handle on controlling its spending? I can’t think of one.

This book makes it easier to recognize the merits of America’s community colleges, which help kids start out their higher education in ways that allow them to explore different areas of interest without the distractions of the “party hearty” campus atmosphere – or breaking the family bank for that matter. Institutions like Chesapeake College in my home area on Maryland’s Eastern Shore are doing yeomen work in this regard, and they deserve better recognition for it.