Changes Facing Higher Education Demographic and Generational Shifts

Changes Facing Higher Education Demographic and Generational Shifts

Changes Facing Higher Education Demographic and Generational Shifts Demographic and Generational Shifts Demographic shifts will require all but the most selective colleges to address impediments to enrolling and graduating all populations. The number of high school graduates nationwide will continue to decline in public and private schools through 2030. Decline will be seen in all regions except the South and will affect the Midwest and Northeast, with their high concentrations of colleges, the most heavily. [White students] are expected to decrease by 14%. We will see an increase of 12% in minority, particularly Hispanic students, as well as African-American/Black students and students from low-income households. Bob Hildreth, U.S. Colleges Are Facing a Demographic and Existential Crisis, HuffPost (July 5, 2017) Demographic and Generational Shifts

Demand for adult learning opportunities accelerates. Colleges and universities are trying to figure out how to tap into the market for second careers to bolster their revenue and perhaps build alumni loyalty. By 2030, the number of Americans 65 and older will grow to 72 million, up from 40.2 million in 2010. Three of every five working retirees said retirement was an opportunity to shift to a different line of work. Kerry Hannon, Over 50 and Back in College, Preparing for a New Career, New York Times (April 3, 2015) Gen Y and Gen Z are increasingly open to online education and digital certifications. Survey respondents, those interested in advanced learning in the business field,

indicated a desire for convenience and a selfdirected learning approach. Ernie Smith, Business School Study Highlights Shifting Education Needs of Digital Generations, Associations Now (March 6, 2018) Demographic and Generational Shifts Facing population declines, Pennsylvania considers changes to higher ed system. Ohio Wesleyan responds to shifting demographics. The small, private Midwest college has efforts underway to offer new majors in high-demand fields; A study was commissioned to add sports and a marching band; identify options to improve the

put more money into financial aid; sustainability of the state higher streamline the process of transferring; education system, including speed students to graduate degrees via consolidation, mergers, and other contracts with other institutions; options to increase flexibility and expand internships and study abroad; responsiveness. freeze, lower, or slow tuition. Charles A. Goldman et al., Promoting the Long-Term Sustainability and Viability of Universities in the Pennsylvania State System of Higher Education (2018) Jon Marcus, College Enrollment Has Plummeted, and Private Universities Are Scrambling, Hechinger Report (June 29, 2017) Growing Concerns About Cost and Changing Perceptions About Value

Changing Perceptions of Cost and Value A four-year degree is still a gateway to increased wealth over time, but the picture isnt completely rosy for graduates. Median net worth and income for degree-holding households havent reached their prerecession peak. This is even as costs of attending college continue to rise. $1.48 trillion U.S. Student Debt Agnel Philip, A Four-Year Degree Is Still a Gateway to Greater Wealth in U.S., Bloomberg Businessweek (October 9, 2017) Changing Perceptions of Cost and Value Growing disillusionment with higher ed

Thousands of institutions are seeking ways to adapt to a rapidly changing landscape that has been destabilized by skeptics, an impatient work force and a fierce conservative populist streak. Reasons for loss of faith differ along political lines. Democrats cite colleges rising costs, while Republicans, 58 percent of whom said that college has had a negative impact on society, think colleges are too ideological. "For colleges, that means reexamining centuries worth of practice. Erica L. Green, With Changing Students and Times, Colleges Are Going Back to School, New York Times (April 5, 2018) Changing Perceptions of Cost and Value

Americans value degrees but are skeptical of cost. Three-quarters of Americans think its easier to succeed in life with a college degree than without one, but only 43 percent say private, nonprofit universities and colleges are worth the cost. 58% say colleges and universities put their own interests ahead of those of students. Only half of student loan holders think their degree benefits outweigh costs. In 2017 Americans owed more than two and a half times what they owed a decade earlier. Only about half of student loan holders think the lifetime financial benefits of their bachelors degree outweigh the costs.

Jon Marcus, They Still Value a Degree, But Anthony Cilluffo, 5 Facts About Americans Increasingly Question the Cost, Student Loans, Pew Research Center (August 24, 2017) Hechinger Report (May 11, 2017) Changing Perceptions of Cost and Value Students want job skills, move away from humanities. Already, demand from students for degrees they think are more closely connected to work has pushed down the number majoring in the humanities from a high of nearly one in five in the late 1960s to one in 20 [in 2017]. Jon Marcus, Worker Shortage Spurs Uncharacteristic Partnerships Connecting Colleges, Business, Hechinger Report (February 9, 2018) 85% Percent of freshman who

said they are concerned about going to college to get a better job Changing Perceptions of Cost and Value Students question value of liberal arts. In a survey of prospective students, fewer than half (38%) think [liberal arts education] is the best kind of education for them. Colleges are reconsidering marketing messaging around the notion of liberal arts. 54% Percent of prospective students who believe that a liberal arts education is available at almost every college or university Art & Science Group, LLC, Whats in a Name? College-Bound Students Weigh

In on the Liberal Arts (September 2017) Changing Perceptions of Cost and Value Policymakers emphasize vocational education and apprenticeships over traditional college pathways. Education Secretary Betsy DeVoss comments signal a shift in emphasis from education to training. Some community college officials said they welcome the emphasis on work-force training. But other leaders in the sector expressed concern that the secretarys rhetoric ignores the extent to which most skills training is embedded into a broader general education context, at two-year and four-year colleges alike. Andrew Kreighbaum, Is Devos Devaluing Degrees? Inside Higher Ed (November 28, 2017) Changing Perceptions of Cost and Value More middle-class families are opting for community college. Hundreds of two-year colleges are now magnets for well-off students, with many having clocked notable increases.

And this fall, Princeton will join a growing group of selective colleges that are focusing more on transfer students. The initiative is directed at attracting more low-income students, but middle-class ones are also likely to see benefits. Kyle Spencer, Middle-Class Families Increasingly Look to Community Colleges, New York Times (April 5, 2018) 69% The percentage of growth from 2010 to 2017 in the number of first-time students at Northern Virginia Community College whose family income was $60,000+ Changing Perceptions of Cost and Value Traditional and nontraditional schools offer job guarantees.

Adrian College pledges to help repay graduates loans until they land a wellpaying job. Davenport University provides additional education for free to any graduate who meets a list of requirements but doesnt have a job in six months. Flatiron, a coding school, and Udacity, which offers online short-term technology courses, offer employment guarantees. Political momentum builds to make universities/colleges have more skin in the game. Proposals include having institutions take an equity stake in loans that students borrow or pay a fee for each student who defaults. Jon Marcus, Colleges Are Pushed to Stand Behind What They Sell With Money-Back Guarantees, Hechinger Report (January 19, 2017)

Changing Perceptions of Cost and Value Colleges work to remove obstacles to graduation. Tennessee public colleges stopped requiring students with low math and English test scores to pass precollege remedial classes. Instead, students took intro classes with extra class time. At University of Maine at Presque Isle, many students who fail a course will get a not proficient (instead of an F) and sign a contract outlining work they must do so they wont have to repeat the course. 40% Percent of college students who havent graduated within six years

Erica L. Green, With Changing Students and Times, Colleges Are Going Back to School, New York Times (April 5, 2018) Changing Perceptions of Cost and Value Northeastern University aims to robot-proof students for the modern workplace. President Joseph Aoun calls this strategy humanicsa staple of Northeasterns program that requires computer science majors to take theater classes. The idea is to give students the ability to solve the worlds most pressing problems in a way that robots cannotwith empathy. Erica L. Green, With Changing Students and Times, Colleges Are Going Back to School, New York Times (April 5, 2018) Challenges to the Business Model Challenges to the Business Model

While consumers grow more skeptical of cost, expenses continue to grow. Meanwhile, colleges and universities expenses are getting even larger, thanks to looming pension liabilities, long-delayed building maintenance, and other financial commitments. Probably the most important issue that all institutions face, large and small, is that they no longer can pass on their rising costs to the consumer. Jon Marcus, With Consumers Pushing Back Against Increased Tuition, Colleges Seek New Revenue, Hechinger Report (October 13, 2017) Too many institutions chasi too few students Enrollment is down. 1.4% decline overall 3% decline at four-year private

institutions <10K students; 5% at small colleges <1K students Tuition is a major source of revenue. 56% of revenues at institutions with <5K enrollment 42% of revenues at institutions with >5K enrollment EY-Parthenon, Strength in Numbers: Strategies for Collaborating in a New Era for Higher Education, 2018 Challenges to the Business Model With expenses outpacing revenues, Moodys downgraded higher eds outlook. Increases of tuition revenue, research funding and state contributions will remain subdued and overall, the sectors expenses will rise by 4 percent.

Uncertainty of federal policies a contributing factor Cuts to federal financial aid programs or even funding growth that fails to keep up with inflation would exacerbate higher educations problems The GOPs tax bills could hurt colleges private fund-raising, increase borrowing costs for private activity bonds and depress graduate student enrollment. And federal immigration policies could decrease international student enrollment. Paul Fain, Moodys Downgrades Higher Educations Outlook, Inside Higher Ed (Dec. 6. 2017) Challenges to the Business Model Tuition dependence at small colleges More than half of small private colleges lost or failed to gain students in 2016. Small colleges are often tuition dependent, meaning they face financial struggle when enrollment declines or even

remains flat. Revenue softness leads to a reduced ability to invest in academic programs, student life and facilities which in turn negatively affects colleges ability to meet the desires of prospective students. And softer demand means that struggling colleges either lose students to other institutions or arent able to charge enough tuition to fully cover expenses. Kellie Woodhouse, Closures to Triple, Inside Higher Ed (September 28, 2015) Challenges to the Business Model Tuition discounting reaches all-time high. Colleges feel pressure to increase the tuition discount in part because student demands are changing. Ever since the financial crisis of 2008, students have a heightened awareness of the price of college and are looking for as much aid as they can get. Kellie Woodhouse, Closures to Triple, Inside Higher Ed

(September 28, 2015) 49.9% Discount rate for first-time, full-time students in 2017-2018 88.7% Percent of freshmen who received grant aid, covering more than half of tuition and fees, on average NACUBO, Average Freshman Tuition Discount Rate Nears 50 Percent (April 30, 2018) Challenges to the Business Model Recent closures suggest a trend of private college consolidation. Institutions feeling particular pressure are small colleges, those in the Midwest and Roman Catholic institutions located away from Catholic population centers.

1 in 8 Institutions that had serious internal discussions about merging in the last year. 2017 Inside Higher Ed Survey of College and University Business Officers 32 The number by which nonprofit colleges have dropped in the last two academic years Rick Seltzer, Days of Reckoning, Inside Higher Ed (November 13, 2017) National Center for Education Statistics Challenges to the Business Model Grad schools and international

students become cash cows. Private universities and colleges are relying on the money they take in from their graduate offerings to stabilize increasingly wobbly budgets, and public institutions to make up for state cuts and undergraduate tuition freezes. As employers increasingly require them, the number of masters degrees conferred per year more than tripled from 1970 to 2015. Average graduate and professional tuition doubled between 1988 and 2010. Jon Marcus, In Demand Graduate Programs Became a Cash Cow for Colleges in Financial Distress, Hechinger Report (September 19, 2017) 7% Average decline in new international students in fall 2017; declines reported for all but the most selective

universities Open Doors 2017 Challenges to the Business Model New revenue sources Colleges and universities are hunting for new money-making ventures, from farm stores to campus summer camps to licensing deals on everything from T-shirts to caskets and urns. One startup is selling unfilled seats in courses to non-students. Another proposes to be a sort of Airbnb for athletic facilities. Jon Marcus, With Consumers Pushing Back Against Increased Tuition, Colleges Seek New Revenue, Hechinger Report (Oct. 13, 2017) Banding together to save money Regionally, colleges are

partnering on libraries, crossregistration, career fairs, insurance plans, digital procurement systems, security, sports, and the arts. Nationally they collaborate on financing, marketing, and legal services. Timothy Pratt, Colleges and Universities Join Together to Survive Enrollment and Financial Problems, Hechinger Report (October 13, 2017) Challenges to the Business Model To stay open, Sweet Briar Call for collaboration in a changes curriculum, pricing. new era in higher ed Changes abolish traditional academic departments [and] align professors in three groups [engineering/science /technology; environment/ sustainability; and creativity/the arts] . The college will reset its prices by moving away from a steep sticker price and high discounts. Tuition will

be set at about the level of Virginia instate tuition. This new era marked by diminished government spending, lagging family incomes, and increased accountability around outcomes demands a significant shift in strategy for institutions around the idea of collaboration and the development of much deeper partnerships than higher education has ever seen before. Lawrence Biemiller, After All But Closing, Sweet Briar Will Shift Curriculum and Pricing, Chronicle of Higher Education (Sept. 6, 2017) EY-Parthenon, Strength in Numbers: Strategies for Collaborating in a New Era for Higher Education

Changing Industry Needs Changing Industry Needs Universal push for 4-year degree results in unfilled jobs. [So] effectively have high school graduates been encouraged to get [bachelors degrees] that high-paid jobs requiring shorter and less expensive training are going unfilled. This not only affects them, but has become a growing threat to the economy. 1/3 A shortage of workers is pushing wages higher in the skilled trades, the financial return from a bachelors degree is softening, even as the price keeps going up. 68% Jon Marcus, High-Paying Jobs Go Begging While High School Grads Line Up for Bachelors Degrees, Hechinger Report (April 23, 2018)

Construction and health/personal care will account for one-third of all new jobs through 2022. Percent more job openings in infrastructure-related fields in the next 5 years than people training to fill them Changing Industry Needs Employers arent finding graduates well trained. The Manpower Group reports that 40 percent of employers are having trouble finding workers with the skills they need. Jon Marcus, Impatient With

Universities Slow Pace of Change, Employers Go Around Them, Hechinger Report (December 18, 2017) 96% 11% Percent of higher ed Percent of CAOs who say theyre business leaders effectively preparing who strongly agree students for work 1.8million 28,000 Number of new tech jobs that will be created from 2014 to 2024 Number of computerscience graduates (bachelors and masters) per year

Changing Industry Needs A faculty removed from industry and a focus on research can be hurdles to innovation. Michael Horn says, Creating short programs that are aligned to industry credentials and needs is complicated and difficult to accomplish with a faculty that may be removed from those industries. There are some places that incentivize great teaching and the alignment of teaching to what students will need when they leave. But a lot of institutions focus on the research and not the use of technology in teaching. Adam Stone, Mr. Disruption: Innovating Beyond K12, Higher Ed Tech News (March 27, 2018) Changing Industry Needs ASU & Mayo Clinic medical school focus on health care delivery for the 21st Century. Graduates will receive a medical degree from

Mayo Clinic and a certificate in the science of health care delivery, jointly conferred. Georgia Tech offers IT program online at 1/6 of the cost, increasing attainment and outcomes. Georgia Tech partnered with MOOC provider Udacity and AT&T. [The] enrollment has grown from 380 students to 6,365 in three yearsmaking it the largest masters degree program in computer science in the U.S. Students admitted to the online program typically had slightly lower academic credentials than those admitted to the inperson program, but they performed slightly better. Mayo, ASU Alliance Seeks Lindsay McKenzie, Online, Cheapand Elite, To Transform Health Care, Arizona State University (Oct. Inside Higher Ed (March 20, 2018) 21, 2016)

Alternative Education Models Alternative Education Models Technology enables new education providers. Higher education is facing significant financial and other pressures, and digital technology is enabling an alternative set of providers of postsecondary credentials [which] let the students learn when theyre ready and how they want to learn, not when and how were ready to teach them, according to Clayton Christensen. Doug Lederman, Clay Christensen, Doubling Down, Inside Higher Ed (April 28, 2017) The evolution of MOOCs:

informing, rather than disrupting, education MOOCs are allowing universities to reach new learners and having an impact on classroom learning. In 2017, 78 million students took 9,400 MOOCs from over 800 universities worldwide. While new users declined somewhat20 million [vs.] 23 million in 2016more people paid for courses [i.e., for certification or credit]. Diane Peters, MOOCs Are Not Dead, But Evolving, University Affairs (Feb. 22, 2018) Alternative Education Models Coding bootcamp model is in flux but may have a lasting impact on higher ed. General Assembly, Dev Bootcamp, Iron Yard, and Flatiron are among coding bootcamps that were supposed to be the next big thing in higher education, promising a compressed, career-focused alternative to traditional graduate school. Many have recently closed or been acquired.

The lasting legacy of education bootcamps may end up being found on traditional campuses. Several colleges are trying the bootcamp approach, even in other fields like health care and political science. In fact, many upstart coding schools are now partnering with those old-fashioned campuses they were intent on replacing. Jeffrey R. Young, Coding Bootcamps Wont Save Us All, EdSurge (August 3, 2017) Alternative Education Models The lesson of MissionU MissionU was a one-year program where tuition (a percentage of earning) would be paid when the student got a job paying $50K+. The fact that MissionU could not make its business work [does not mean] that higher education does not need to change. Traditional schools need to figure out how to offer [a] degree that provides value above and beyond what can be gained from a nontraditional (micro) credential.

WGUs satisfaction rates Designed to serve rural areas and underserved populations, Western Governors University offers a flat fee structure (around $3,000 per 6month term) and a competencybased model that lets students move at their own pace. Students have course and faculty mentors. Seventy-three percent of grads say their education was worth it, compared to 38% nationally. Diana Hembree, Western Governors University: The Best-Kept Secret in Joshua Kim, Lessons for Higher Ed From theOnline Colleges, Forbes (August 10, 2017) Demise of MissionU, Inside Higher Ed (5/23/18) Alternative Education Models Purdue University acquires Kaplan and 32,000 online students. The move reinforces the importance of online higher

education. Supporters say it will allow Purdue to expand access, especially to adult students. But some are concerned about the impact on the universitys brand and public image. Paul Fain and Rick Seltzer, Purdues Bold Move, Inside Higher Ed (April 28, 2017) Apple provides technology and training at Ohio State. Ohio State will integrate Apple technology into all its teaching and learning experiences as part of an institution-wide initiative. Apple will provide iPads at a discount, and an Apple-designed iOS laboratory to teach Apples programming curriculum. Lindsay McKenzie, A Higher Ed Strategy From Apple? Inside Higher Ed (October 6, 2017)

Other Trends Changing Admission Strategies Leading educators are beginning to rely more on character attributes in admission. The test-optional movement now has more than 950 participating colleges. The Common Application has incorporated non-cognitive attributes. The Turning the Tide project [aims] to elevate service and caring in secondary education and in college admission. The Institute on Character and Admission includes admission deans from the nations most selective colleges. The College Board, ACT, and the [ETS] are studying how to understand and assess the non-cognitive domain. David Holmes, How an Entrenched College Admission System Is Evolving to Consider Character, NAIS Independent Ideas Blog (May 8, 2017) Role in Controversies and National Movements Violent activism and balancing free speech

and safety With the most notable example being the August 2017 violence at The University of Virginia, campuses are wrestling with how to balance deeply held views about the importance of free expression with the need to keep their communities safe from harm. Student safety concerns With a rise in widely publicized incidents, colleges can expect more parental and legislative expectations for student safety, including in athletics and Greek life. Lisa M. Rudgers and Julie A. Peterson, Saddle Up: 7 Trends Coming Up in 2018, Inside Higher Ed (January 2, 2018) Role in Controversies and

National Movements #MeToo movement in the academy Those who have experienced sexual assault and sexual harassment are fed up. The wave of reports and takedowns of powerful leaders including some well-respected faculty membershas been breathtaking. Colleges can expect more complaints of harassment going back years, especially among vulnerable populations. Lisa M. Rudgers and Julie A. Peterson, Saddle Up: 7 Trends Coming Up in 2018, Inside Higher Ed (Jan. 2, 2018) 1/2 Half of women in science have experienced harassment, according to a recent study of higher

ed. National Academies of Sciences, Engineering and Medicine, Sexual Harassment in Academic Sciences, Engineering, and Medicine, 2018 Questions for Independent Schools Questions for Schools Questions for Independent Schools Do you have a clear and focused mission under which all program offerings are aligned? Are there ways to further strengthen your value proposition? Are you considering market research to understand demographic shifts and what the market is buying? Have you considered developing program offerings for alumni who want to develop new or enhanced skills? Have you evaluated your schools long-term sustainability risk? Have you brainstormed ways to reduce your schools reliance on tuition? Are partnerships a possibility at your school to reduce expenses, increase

efficiencies, or enhance your offerings? How can your school best prepare students to succeed in todays college environment? How can your school prepare students for skills needed in the modern economy? Do you regularly review policies and practices that ensure safety and protection for students and staff and faculty? References

Bob Hildreth, U.S. Colleges Are Facing a Demographic and Existential Crisis, HuffPost Kerry Hannon, Over 50 and Back in College, Preparing for a New Career, New York Times Ernie Smith, Business School Study Highlights Shifting Education Needs, Associations Now Charles A. Goldman et al., Promoting the Long-Term Sustainability and Viability of Universities in t Pennsylvania State System of Higher Education Jon Marcus, College Enrollment Has Plummeted, and Private Universities Are Scrambling, Hechinger Report Agnel Philip, A Four-Year Degree Is Still a Gateway to Greater Wealth in U.S., Bloomberg Businessweek Erica L. Green, With Changing Students and Times, Colleges Are Going Back to School, New Yor Times Jon Marcus, They Still Value a Degree, But Americans Increasingly Question the Cost, Hechinger Report Anthony Cilluffo, 5 Facts About Student Loans, Pew Research Center Jon Marcus, Worker Shortage Spurs Uncharacteristic Partnerships, Hechinger Report Art & Science Group, LLC, Whats in a Name? College-Bound Students Weigh In on the Liberal Ar Andrew Kreighbaum, Is Devos Devaluing Degrees? Inside Higher Ed

Kyle Spencer, Middle-Class Families Increasingly Look to Community Colleges, New York Times Jon Marcus, Colleges Are Pushed to Stand Behind What They Sell, Hechinger Report Jon Marcus With Consumers Pushing Back Against Increased Tuition, Colleges Seek New Revenue Hechinger EY-Parthenon, Strength in Numbers, Strategies for Collaborating in a New Era for Higher Educatio Paul Fain, Moodys Downgrades Higher Educations Outlook, Inside Higher Ed Kellie Woodhouse, Closures to Triple, Inside Higher Ed NACUBO, Average Freshman Tuition Discount Rate Nears 50 Percent References Timothy Pratt, Colleges and Universities Join Together to Survive Enrollment and Financial Problems, Hechinger Report Lawrence Biemiller, After All But Closing, Sweet Briar Will Shift Curriculum and Pricing, Chronicle of Higher Education Jon Marcus, High-Paying Jobs Go Begging While High School Grads Line Up for Bachelors Degrees, Hechinger Jon Marcus, Impatient With Universities Slow Pace of Change, Employers Go Around Them, Hechinger Report Adam Stone, Mr. Disruption: Innovating Beyond K-12, Higher Ed Tech News Mayo, ASU Alliance Seeks to Transform Health Care, Arizona State University Lindsay McKenzie, Online, Cheapand Elite, Inside Higher Ed

Doug Lederman, Clay Christensen, Doubling Down, Inside Higher Ed Diane Peters, MOOCs Are Not Dead, But Evolving, University Affairs Jeffrey R. Young, Coding Bootcamps Wont Save Us All, EdSurge Joshua Kim, Lessons for Higher Ed From the Demise of MissionU, Inside Higher Ed Diana Hembree, Western Governors University: The Best-Kept Secret in Online Colleges, Forbes Paul Fain and Rick Seltzer, Purdues Bold Move, Inside Higher Ed Lindsay McKenzie, A Higher Ed Strategy From Apple? Inside Higher Ed David Holmes, How an Entrenched College Admission System Is Evolving to Consider Character, NAIS Independent Ideas Blog Lisa M. Rudgers and Julie A. Peterson, Saddle Up: 7 Trends Coming Up in 2018, Inside Higher Ed National Academies of Sciences, Engineering and Medicine, Sexual Harassment in Academic Sciences, Engineering, and Medicine Data sources: National Center for Education Statistics, Open Doors 2017, Inside Higher Ed Survey

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