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Graduating College?
As college acceptances are in and people are considering where to go, they are thinking about where to spend the next four years of their lives. Few of them realize that more often than people know, it takes longer than four years to graduation from college.
As college acceptances are in and people are considering where to go, they are thinking about where to spend the next four years of their lives. Few of them realize that more often than people know, it takes longer than four years to graduation from college.
It’s a bit of a shocker, right? They are called “four-year colleges” for a reason. It’s supposed to take you four years to graduate. In fact, when I ran the CIRP Freshman Survey and we surveyed hundreds of thousands of freshman arriving at hundreds of colleges across the US, 88% thought they would graduate in four years.
In reality, only 49% graduate after four years. It’s such an issue that the US government routinely looks at the six year graduation rate as a benchmark. At six years, 62% graduate from college.
That extra 2 years for 13% of college graduates has a cost. First of all, tuition and related expenses for two more years is a big deal. Most likely you and your family only budgeted for four years. Second of all, the opportunity cost of being in the job market for two years has an impact as well. Not only are you using more money to go to school those extra years, but you are not making as much as you could if you had graduated and been working.
And by now some of you have done the math and figured out that if 62% graduate in 6 years, 38% do not. Close to 1 out of 3 students who start college do not get a degree. For those who have student loans, this is a big concern. We know that college graduates can command much higher salaries than those whose highest degree is a high school diploma. The people who are worst off are those who took loans for college, but left without a degree, and this cannot take advantage of that wage bump.
So it is really important when deciding where to attend college to look at how many people graduate within four years. It can make a huge difference in a place that supports a life long benefit, or that becomes a liability.
More About Majors
My colleague Jamie Merisotis, president at the Lumina Foundation, wrote an interesting article in Forbes recently. Lumina was a major funder of the Gallup-Purdue Index, which I was the lead researcher on and have talked about on this blog before, so although we had known each other previously, we were on the road together speaking about those findings.
The article makes a great point about majors. Majors should not be seen as defining what area your career will be in, but as a starting point to learn about learning most of all. Some majors do point towards careers in that field, like engineering and business. Other majors have broader applications, such as English. In the article Jamie writes about how an English major used the skills he learned in that major, such as effective communication, to get a job in a field not ordinarily seen as connected to English.
College students need help recognizing what skills they have acquired through their college classes that go beyond the subject matter knowledge. I spoke about this a bit in my TEDxUCLA talk. Career Services can help college students articulate what career skills they have from not only the classroom, but activities and teams. Unfortunately, many students do not realize this, and do not take full advantage of the resources in Career Services. A good piece of advice is to visit Career Services early on in your college years. Don’t wait until spring term of senior year. Go in your first year of college so that you can frame your experiences through a lens of future employment.
What Matters Is What You Do, Not Where You Go
Since college admissions decisions have come out, I’ve been talking with high school seniors about their choices. Most people have great options, although they don’t always feel that way if they have been waitlisted or did not get into the college they really wanted to go to. That’s when I emphasize that it’s not so much where you go, but what you do in whatever college you attend, findings from the project I was lead researcher on for Gallup: The Gallup-Purdue Index.
When I am asked what is important to do in college I fall back on the BIG SIX as well called them. These are the college experiences that are most likely to lead to what we called the Great Job and Great Life, based on Gallup’s outcomes measures in wellbeing and employee engagement.
Here are the BIG SIX, and people who strongly agreed with these statements were more likely to have the Great Job and Great Life:
I had at least one professor at college who made me excited about learning.
My professors at college cared about me as a person.
I had a mentor who encouraged me to pursue my goals and dreams.
I worked on a project that took a semester or more to complete.
I had an internship or job that allowed me to apply what I was learning in the classroom.
I was extremely active in extracurricular activities and organizations while attending college.
The key is to get involved. We saw this in the survey program I ran at UCLA as well. Involvement is what matters. If you get involved, wherever you go to college, that is the differnce.
Decision Making in a Crisis
In times of rapid change, we often are in a quandary about making decisions. This is because the information we have had in the past, through our experiences and studies, doesn’t necessarily apply in these new situations.
I’ve always been about information-informed decision making. The current health crisis reminded me of a much smaller and less harmful situation I was involved with back in 2002 at Dartmouth College. An outbreak of conjunctivitis was spreading rapidly through the campus and we just did not have the information we needed to deal with the crisis. The Center for Disease Control came to campus to try to help when we quickly realized we needed more information.
In 2002 it was still not commonplace to conduct web surveys. In fact, the CDC had never seen it done before. I, however, had been experimenting with this mode of surveying since the mid 1990s. We quickly created a survey to help us understand what faculty and student behavior was like in the crisis and how they were feeling about it. Armed with the rapid results from a web survey we were able to identify issues that we could impact to improve the situation. I wrote an article about this that was published in the Journal of American College Health.
I recently also worked with a college that evacuated in the face of a hurricane, examining through surveys what the student experiences were like, what they feared, and how they continued to learn as the were forced off campus.
In the days and weeks ahead we will need more information to move nimbly through this unprecedented change in our lives. Based on my experiences gathering helpful information for decision making in education in both crisis and in everyday situations, I am actively creating tools and processes that will help organizations make the best decisions possible.
Stay tuned.
Is College Important?
My former colleagues at Gallup have released data that indicates that fewer Americans believe that a “college education” is “very important.” When asked about the importance of a college education in 2013, 70% of Americans thought it was “very important,” but that percentage dropped to only 51% in 2019.
The landscape of higher education has changed a bit from 2013 to 2019, but I would say more has changed in what the public considers a “college education.” More people now see how varied “college” can be. For instance, there is much greater visibility of online education (the good and the not so good) now than in the past. In addition, there has been much greater uncertainty about the impact of college, driven by the lack of transparency from most institutions concerning data that shows impact coupled with the higher levels of debt that in most cases accompanies a college education. And the media has certainly showcased many instances in which students leave college before graduation, ending up with very little to show for besides increased loan balances.
Just asking about a “college education” is too simplistic. It’s like asking if restaurants are good: there are a lot of good ones, a lot of adequate ones, and some truly horrible ones. In some cases a college education can change the life trajectory of a student. That certainly happened to me. In other cases it might seem to have few benefits. And in those cases of students leaving with no degree and high debt, it can be a big step backwards.
The positive side is that we have much more information about options now to be able to make better choices. The negative side is that most of this information lies in the heads of those of us who study higher education, and does not reach those who are facing life changing decisions about if, where, and how to go to college.
Keep an eye on this space for that to change.
College 2040
I was interviewed recently for an article on how universities will evolve over the next 20 years by Paul Rogers of LA Weekly.
Here are some of my thoughts, somewhat expanded from what made it into the article. But please go read the article, as you might like what others said more than what I had to say.
“We will continue to see multiple choices for post-secondary education that have evolved from the traditional campus-based residential four-year experience. While this will still be an option, it will be less so that it is now. Online universities will continue to improve and grow as an option, especially for people who live in rural areas or who want to work. Working as you learn will become more prevalent, with people working full time while pursuing degrees. In addition, credentials will become more mainstream, where people obtain smaller certifications of focused talent. Stackable credentials will also be used to add up to a degree. Some of these will be offered by community colleges and four-year universities as they expand their purview to the growing number of adult learners, but also will be found as coding academies become more widely recognized and available as places where learners can focus on particular skill sets such as data analytics and project management. “
“The ability to learn online is a huge technical achievement that is adapting and improving every day as we learn about the best ways to deliver online education. It can bring education to those in “education deserts,” which are areas currently hours away from brick and mortar institutions. This dovetails with how more employees are also working remotely, so as one learns in the online environment it prepares them to work in an age of email, Zoom conferencing, and file sharing. The education of the future will mirror the workplace of the future.”
“While some students will continue the pathway of high school to four-year college, others will take different pathways to combat the high cost of college by working and learning simultaneously. We have also seen companies foster the education of their workforce, such as partnerships between Starbucks and University of Arizona, and the new program at Google to provide education internally to employees on a wide scale basis. As working and learning become more entwined, look for workers to stay with the same employer for longer periods of time, as more of their needs are met through these partnerships that enhance the experience.”
“Education will become less seamless and more continuous throughout the process. With physical and financial barriers breaking down, the pathways to learning will become less codified and more adaptable to one’s life situation.”
“The future of education is that it will truly become a lifelong process that people can dive in or wade in at points in their life that allow them to do so in the way best for them. “
The Flip Side of Student Loans
We’ve all heard about the large amounts of student loans people have, and the negative impacts they can have on graduates, and especially those who took out loans but did not graduate.
A new study, though, shows the negative side of not borrowing enough. In this examination of a program designed to inform students about their loans, those receiving these educational messages ended up taking less money in loans to support their college experience. You’d think that would be good, right? Given what we hear about student loan debt.
But the worst result of student loans is those students who have loans but still drop out. They do not get the wage bump that comes with being able to look for jobs that require a college degree, but they still owe money.
The students who took less money in loans ended up performing worse in college. They ended up failing classes. This could be because they needed to work longer hours in order to support themselves without that loan money.
It’s true that student loans are sometimes hard to pay back. But if you could just borrow a little bit more (the students in this case took only $400 less in loans than the other students) you might have a huge payback in terms of being successful in college.
Top 5 College Choice Tips
Thousands of people are looking at college acceptances this month and trying to decide where to go. Based upon my 25 years of experience studying higher education, here are my top 5 tips.
Cost
Look very carefully at your financial aid letter. Make sure that you understand how much you are getting in actual aid versus loans they expect you to take out versus the costs they expect you to pay outright. If you are unsure about what the language means, then ask or look for help. And remember to factor in costs of travel to and from school.
About 1 in 5 students get into their first choice, but decide that it is just too expensive to go there. That’s an OK choice. My research has shown that students who attend their second, third, or fourth choice can be just as satisfied with their freshman year as students who go to their first choice.
And it turns out that what matters more than where you go to school is what you do when you are there. You don’t need to make great financial sacrifices to have a great college experience.
Graduation Rate
Not many people know this, but about 1 in 4 students do not return for their sophomore year. And, on average in the US, only about 2 out of 3 actually make it and graduate from that school. This also varies a lot from school to school. You can use the College Navigator website to find out the percentage of students who graduate and see how the schools you are looking at do in this. You want to maximize your chances of getting that diploma!
Major
Make sure that the school you are looking at actually has the major you are thinking about. At one of the colleges I worked at every year we would get students arriving who were ready to major in business. But we did not offer a business major! Look through the majors and see, and while you are there look at other majors that are offered, as many students end up changing their major by graduation.
Location
Some people want to go to college close to home, and others want to go as far away as they can get. Regardless, think about things like rural versus suburban versus an urban location. If you are from a big city and think it might be fun to experience the country, think again about if you would really like that much of a change while also trying to balance all the other things a college student needs to balance. Think about climate. It can get pretty cold (or hot) some places.
Fit
How did you feel when you visited the school? Saw the students there? A campus visit can be very important to help you figure out if this school is right for you, as I have previously posted. If you absolutely cannot visit, talk with students in your area who go to school there and try to find out as much as you can online about the culture at the school.
Obviously there are other things to consider, but these are good places to start when you are making this choice. And, finally, relax. Most colleges and universities are really great places to learn and live!
Good luck! It’s going to be great!
What Influences College Choice?
Choosing a college involves many factors, such as cost, location, and the academic reputation of the institution. Increasingly important to people going to college for the first time, however, is the college visit. According to the newly released 2017 CIRP Freshman Survey results, 47.3% of students who entered college in the fall of 2017 indicated that the campus visit was very important in their decision about where to go. Although not the reason given by the most students (that the college had a very good academic reputation, at 65.6%), the college visit shows an increasing importance, rising from 37.6% just 15 years ago.
What is it about the college visit that makes it so important to almost half of college freshmen? Research by Longmire and Company indicates two factors: getting a “feel” for the campus, and how welcoming and friendly the current students seem.
Prospective students look for a college that seems to be a good fit for them.
In addition to being important in college choice, the importance of the college visit and this concept of “fit” is connected to retention. Research I conducted when directing the CIRP survey program indicated that students who placed high importance on the campus visit were also more likely to return to that college for the sophomore year.
Given that close to 1 in 4 students do not return for their sophomore year, the importance of determining a fit between the applicant and the college is paramount. Admissions materials that portray a glossy and idealized campus life might get students in, but if after attending the promises turn out to be hollow then we should not be surprised that some students do not return. Especially with college costs as high as they are.
What else do incoming students consider? First and foremost, as we found for years at CIRP, students go to college to be able to get a better job than they otherwise might (84.9%) and 55.7% of students choose their college because they believe that graduates from that school get good jobs.
This is not to say that this is all that is important: 83.6% also report that they are going to college in order to learn more about things that interest them.
What is not important? College rankings. For many years, 2017 included, few (17.9%) students tell us that this was important in their choice of where to go.
Expectations of college are high. Students more and more want to get that better job, to learn more about things that interest them, and to get into good graduate schools. Higher education needs to be aware of these expectations and, especially given the high costs of college and the increasing student debt loads, be able to demonstrate that they are meeting these expectations. Our student deserve no less.
Experiential Learning and Retention
About one in four college freshmen leave their school do not return for their sophomore year. So why, when faced with such a big problem, would I decide to talk instead about the importance of experiential learning in college at the Annual Conference on the First-Year Experience?
Because one of the big reasons why some students decide to drop out of college is that they don’t see how it is relevant in their lives in the twenty-first century. If you are paying a lot of money (as well as taking on student loans) and also think you are not getting anything out of it, you might very well decide to focus elsewhere.
The number one reason why students go to college is to get a better job. If you don’t think college is going to do that, then you look elsewhere. And there are more alternatives to college now than ever before with the proliferation of online learning in many forms (some free) and bootcamps such as General Assembly that provide immersive training in specific areas that is designed to get you that better job in less time and for less money than college.
Experiential learning programs can bridge that gap. Students with internships or coops are much more likely to see the relationship between what they are learning in school and what they are doing in the workplace. The research shows that these students also have greater gains both in college and after they graduate. They also have stronger ties to their alma mater after graduation.
Given the importance of helping students obtain internships and coops to retention, success in school and the future, as well as stronger alumni ties, you’d think that colleges and universities would be putting lots of support into this process. Unfortunately, you’d be wrong.
It’s time that higher education leadership recognizes the importance of this work, especially as potential students move towards alternate pathways to the better job that they are so focused on.
Work and Learn Programs Demonstrate Long-Lasting Effects
Evidence has been mounting to show the positive outcomes for college students engaging in experiential education programs such as internships or co-ops. Such experiences have been designated “high-impact practices” based upon extensive research using the National Survey of Student Engagement (NSSE) and one of the “big six” college experiences that lead toward higher levels of engagement in your job and wellbeing by the Gallup-Purdue Index. Time and time again work and learn programs demonstrate powerful and long-lasting effects.
But, how well are colleges facilitating such experiences for their students? This was the focus of a survey that I conducted with the support of ACT’s Center for Equity in Learning: Characteristics of Experiential Learning Services at U.S. Colleges and Universities.
There are a number of take-aways from this study, and I encourage you to read the (short) report, but in this blog I want to focus on support for working learners, a topic the Center has explored previously.
While most administrators told us in the survey that they provided a number of services and programs to undergraduates seeking a work and learn experience, there was a general lack of assistance specifically targeting how to be successful managing both school and work. Only a third reported offering personal counseling on how to balance school and work. Only a quarter reported that their office had extended office hours to accommodate working students. There was little support in helping working students balance academic deadlines. A logical conclusion is that we need to provide more help to working learners if they are going to be successful in school and career.
Many Career Services staff want to provide this assistance, but do not have the resources to do so. They need additional staff to both run these programs and to ensure that students see such resources as useful and supportive of their success. Many survey respondents told us that it just was not an institutional priority to further support this work. We must work to change this.
The mismatch here is that trustees, presidents, and provosts want and need the outcomes of such programs. They need to demonstrate that their graduates are going to be successful in their careers and other aspects of their lives. One way to do that, we know from research, is to promote the connection between learning in the classroom and the world outside the classroom. If college leaders align their institutional missions with greater support and funding for students to engage in experiential learning, everyone wins.
Average Student Debt is now $28,350
The Institute for College Access & Success (TICAS) released their annual report today on student debt, with the finding that the average loan amount upon graduation from a four-year college in 2017, for students with loans (65% of all graduates), was $28,350. Although from 1996 to 2012 we saw the average debt rise about 4% a year, this has slowed to where there was only a 1% increase from 2016 to 2017.
The TICAS figures are similar to ones collected with different methodology by the U.S. Department of Education’s National Postsecondary Student Aid Study, which calculated the average debt at $29,650 for 2016 graduates (the national study is only conducted every four years).
There is, however, significant differences depending on what institution the student attended, as one might expect. On the low end of institutional differences the average debt at graduation was $4,400 but on the high end students were graduating with an average debt of $58,000. It matters a great deal financially where one goes to school.
In addition to the loans taken out, in 2015-2016, on average students and their families paid $6,600 out of pocket on top of scholarships and grants received.
Organizations like TICAS help us understand the actual situation of student debt to help students and families go beyond the hype as well as assist policy makers who are trying to make a difference.
Evacuating Campus
As a number of college campuses are currently evacuating ahead of Hurricane Florence, I thought it might be useful to report on some findings from a study I did last year on the evacuation process at a residential college.
I surveyed undergraduates who had been under a mandatory evacuation from their college. The idea here was to gather information about the process with an eye towards improvement. As such, I asked about three phases of evacuating: 1) immediately after the decision to evacuate was communicated, 2) the evacuation itself, and 3) the return to campus life.
Here are some of the themes we saw.
Advance planning is key. Although the college had communicated with students about the likelihood of a hurricane, and had very good policies and procedures to follow, few students actually had plans in place before the actual threat was imminent. As one student wrote: “[I was] scared because I did not have a plan in place for where I was going to evacuate to.” One recommendation was to incorporate an actual mock evacuation plan into first-year orientation.
Communication is necessary at all stages. Students appreciated frequent communication. The most useful communications they received, they told us, where from parents and other family and the college. They prefered email communication over other forms.
Be flexible. As the path of a hurricane can vary quite a bit from predictions, and the situations one can encounter on the way (e.g., traffic, full hotels, gas lines, etc.) are also constantly changing, many students changed plans. Some changed en route, with 20% telling us that they ended up at a different place than they have planned to be when they left campus. Half of them ended up staying at more than one place for the week that they were evacuated.
Keeping up with academics was a big concern. The biggest concern students had throughout the process was about academics, with 62% telling us they were either “extremely” or “very” concerned about this. Internet connections were spotty, and the general level of anxiety about being evacuated and what would be left to return to combined to make it hard to focus on school work that was required during evacuation. This continued to be a concern once back on campus, as 42% told us it was hard to get back into classes after returning, despite the fact that many felt that faculty were accommodating.
All in all, many students learned from the process. As one student told us “I realized how much independence I had gained, I realized I had the ability to communicate, and to get along with people I had not known previously.”
The survey helped shed light on the process…the good and the not as good…and the impact of evacuating. Evacuating ahead of a hurricane is an experience full of anxiety, but managing the process can reduce that anxiety for all involved.
Major Dilemmas
A recent study on the timing of declaring your college major by the Education Advisory Board (EAB) indicates that changing your major as late as your senior year does not necessarily conflict with your ability to graduate on time, contrary to popular beliefs. There is a nice article summarizing this on Inside Higher Ed for those who want the shorter version.
We certainly need to know more about the impact of college major. When is the best time to have students declare a major? Early on makes it more likely that the student will be able to complete all the requirements on time. But forcing that choice too early can mean making a decision that is not all that well informed. In the EAB study, students who declared early and stuck with that major were slightly less likely than the late major changers to graduate.
There are a lot of other things to consider here. First off, the study looked at when students officially declared their major, which might not be when they actually decided to switch and changed their course plan accordingly. It certainly could be the case that they just saved the paperwork until later in the game.
In looking at the impact of major change one also needs to take into account how drastic the change is. When I directed the Cooperative Institutional Research Program (CIRP) we looked at major changes and many of them were in the same related area: marine biology to biology, for instance. These are likely to share common courses that would could for either major, rather than, say, marine biology to art history. The latter change is likely to need additional courses.
Then to throw another wrench into the picture, there are double majors, also a topic of recent examination. In another new study, students with double majors scored higher on a measure of innovation than those with only one major. The authors then tied this into research showing that innovation is a desirable trait that employers look for.
The impact of major is key to the college experience, and it's great that we are learning more about how to help students navigate this important decision.
Assessing Wellbeing
I'm just back from NASPA's Annual Conference, where I presented with colleagues from Wake Forest University on how we have been creating a wellbeing assessment for college students.
We've done several pilots of this instrument, and some of the findings include information that tells us wellbeing is a serious issue in college students:
•75% felt unable to stop worrying
•54% felt depressed
•54% felt isolated
Wellbeing is a huge concept, and so we had to decide what to concentrate on in this assessment. There are three organizing principles that we have been using to craft the instrument.
- It needs to include areas of wellbeing that are developmentally appropriate for the institution. Wake Forest is predominantly 18-23 year olds, and so this is the age group we focussed on. This is not to say that they would not be appropriate for older students, but this was our focus.
- The wellbeing components have a substantial body of research behind them.
- The survey is actionable. We are only concerned here with information that provides guidance to practice and policy, so they must be components than can be changed through these methods.
Here is a link to the powerpoint we used. And here is a link to the project as a whole.
This is great work in a crucial area of the student experience.
Losing Foreign Students
For the first time in 35 years, total enrollment of international students in U.S. colleges and universities has dropped, according to multiple sources using National Science Foundation and U.S. Department of Education data.
As pointed out in the Brookings report cited above, one of the effects of this downward trend is a negative impact on college revenue. International students typically do not receive financial aid from the institutions in which they enroll, which means they pay full tuition in a time when that is not the norm. So, international students can provide much needed cash in an era when state appropriations for public institutions and high tuition discount rates at private institutions are eating away at the revenue stream.
We saw a foreshadowing of this in the Chronicle Pricing Survey that I conducted with the Chronicle of Higher Education in the fall of 2017. Fifty-nine percent of presidents and chief financial officers at private not-for-profit colleges and 40% at public institutions told us they were either "extremely" or "very" concerned about potential federal policies resulting in a "diminished ability to attract international students."
There are many benefits of enrolling international students besides tuition revenue. But the decrease in this source of revenue will need to be offset by an increase in other sources, and the one source that colleges and universities have the most control over is tuition. The decrease in enrollment of international students could mean an even larger increase in tuition for U.S. students. In an era when college tuition needs to go down and not up, the loss of international students is a move in the wrong direction.
Why Students Don't Graduate from College
"Too many college students gradua [sic]with six-figures of debt, wondering how they'll ever pay it off. If they had gotten good advice on the importance of taking enough credits to graduate quickly, they could have planned better and avoided unnecessary debt." -Tom Kean, New Jersey Senator
To remedy the situation as he sees it, Senator Kean proposes billboards and other marketing aimed at encouraging students to take 30 credits a year towards their degree rather than fewer than 30.
Let's look at the premise, first.
Are too many college students graduating from college with six figures of debt? Most of the data says no. According to the Federal Reserve Bank of New York, only five percent of students graduate with over $100,000 in student debt. Part of that, perhaps a large part, is debt from medical and law degrees, not college.
Many students do borrow money for college: about two out of three. The average debt that a student graduates with is $30,100, according to one of the best studies on this by the Institute for College Access & Success. On a ten -year repayment schedule, that is $346.39/month.
So, not a lot of students are graduating with "six-figures of debt." There is widespread debt, but to a much lesser degree.
Let's turn to the next claim, that students are not graduating because they did not plan better and took too few courses. Most of the extensive studies on graduation will not say that students left college due to poor course planning.
What are some of the reasons why students don't graduate?
Financial. Some leave because they cannot afford to pay tuition. Maybe their family contribution suffers from a lost job, a medical emergency, or a housing problem. In some of these cases the student not only cannot afford continued college costs, but might actually feel the need to move back in with the family to help with a crisis. Or, maybe to work and contribute to the family finances.
Another financial impact on college graduation is needing to work while in college to help pay the bills. Students who work many hours a week for pay are more likely to drop out. But there is another issue here with students who work long hours, which is that the work time cuts into academic time and social time. Students who work long hours can suffer academically. They also can form less of a connection with fellow students and feel less of a sense of belonging to the college. All these issues impact graduating.
There are also institutional characteristics that impact graduation. Research that I have done shows that institutions that devote fewer resources to student support tend to graduate fewer students. Barriers can be high ratios of faculty to students and of academic advisors to students.
I'll point out one more big problem: remediation. Many students graduate from high school ill prepared for college work. This can mean that the first year of college is spent retaking classes, such as English and math, that should have been mastered in high school. When a student who might already be feeling financial pressure to attend college sees that the whole year of "college" is really just a repeat of high school, he or she understandably has second thoughts.
I applaud the New Jersey Senate for seeing that college graduation needs help. But does it need billboards? Probably not. More money needs to go towards state financial support. Two big ways to influence graduation would be to increase financial aid and to increase student support.
I think that's a better way to solve the problem than to blame the student for poor planning.
What Really Drives Tuition
We often hear, from faculty, higher education pundits, and just from random people on the street, that the high cost of college is driven by spending money on college administration. We've all seen the stories about the million dollar lazy river on campus! And while there are a few of those (not paid for by tuition dollars, though), this is hardly the norm.
In the Chronicle Pricing Survey that I conducted with the Chronicle of Higher Education, we asked college presidents and chief financial officers how important various expenditures and revenue streams were in determining undergraduate tuition this past year.
About three out of four (74%) college leaders told us that the "cost of faculty" was either "extremely" or "very important" in determining tuition. This was the expenditure of highest concern for them.
The cost of administration was of concern to many fewer college leaders, with only 44% telling us this was an "extremely" or "very important" consideration in setting tuition.
So, while administrative costs have an impact, it is quite a bit lower than that of the faculty. This is probably as it should be. But not how the issue is perceived.
College tuition is not largely driven by administrative costs. So the next time you hear someone say other wise, remember that you have the data on your side.
So, how would that work, for higher education professionals? I turned to my friend Gavin Henning, past president of ACPA and snappy dresser, for a consultation. He suggested looking at it from the lens of staff level.
For entry and mid-level, Gavin said, this "helps to provide a counter narrative to what we hear in the news." Sharing this data with colleagues helps to provide data to their experience.
For the mid-level to senior-level staff, this information can be used in budget discussions. Student-affairs professional have student learning at heart, and many students and alumni tell us that their learning was greatly enhanced by their experiences outside the classroom. Student affairs professionals can use this information to stave off budget raids when others think that "administrative bloat" needs to be curtailed.
Data always contributes to the story if you use it wisely.
The Current Practice of College Tuition Discounting is Not Sustainable
In my last blog, I wrote about the practice of tuition discounting, and how college presidents have a very different understanding of how applicants and their families view tuition than they actually do. Tuition discounting is the widespread practice of setting the “sticker price” of tuition at a high level, but then offering financial aid to discount what people actually pay. Hardly anyone pays full price. The average discount is about half the price in private colleges and universities.
And the rate at which schools discount is increasing every year. In the last ten years, it has increased about a percentage point a year, from 38.6% in 2006-2007 to 49.1% in 2016-2017 (figures are from the very well done NACUBO Tuition Discounting Study).
Economically, this annual increase is a disaster for colleges and universities, since it means less tuition revenue per student.
The schools know this. In a survey that I created and conducted with The Chronicle of Higher Education, we found that four out of five college presidents and chief financial officers (CFOs) thought that the practice of tuition discounting was unsustainable. At private institutions, we found that among CFOs, the people most knowledgeable about institutional finances, 70% thought that tuition discounting was not sustainable at their own institution.
Clearly, something needs to change.
For more results on the College Pricing Survey, get the report from the Chronicle’s website.
The Tuition Pricing Crisis
We have a big problem with college tuition.
Multiple analyses of college tuition have indicated that it has risen at rates higher than inflation, health care, housing, and a host of other items and services.
The inevitable question, then, is why is college so expensive? And how are tuition prices determined?
Much of the research on tuition pricing looks at economic data, such as the relationship between tuition increases and decreases in state monies going to higher education. At the same time that we see public colleges receiving less money from the state, we also see that tuition at those institutions is rising. The conclusion then is that those responsible for setting tuition are making the decision to raise tuition to make up for decreasing state contributions.
There are many other factors, however, that are more complicated. And while the decisions around tuition pricing might be informed by economic factors, ultimately, they are made by people.
I wanted to know what the people making the decisions were thinking.
So, I worked with The Chronicle of Higher Education to develop a survey for college presidents and chief financial officers that would ask about their decision-making process. The results are available in a nice report on the Chronicle’s website.
I always think that when you have to solve a problem, it’s important to trace that problem back to assumptions that people have made. They are not always right. So, here’s a big disconnect we found.
College leaders’ assumptions about what prospective students and their families understand about college pricing are pretty much wrong.
Here’s the situation. Many of you know this already, so bear with me for a minute.
The real problem is that many people looking at colleges don’t know about this.
Hardly anyone pays those high sticker prices for college tuition.
College leaders know that prices are too high for many to afford, and so after those high prices are published, the colleges throw a lot of financial aid at the problem. A high sticker price is associated with quality. Just like you assume that a $50 bottle of wine is much better than a $10 bottle of wine. And it usually is, but not many people can spend $50 on a bottle of wine. So, colleges discount tuition. On average, they discount it by about half.
That means that at a college with a sticker price of $30,000, the average amount that gets charged to students is $15,000 (of course it varies student by student and school by school, but this is about average).
All of a sudden students and their families are paying only $15,000 a year for a $30,000 a year college education. Great deal, right?
Here’s the disconnect.
College leaders assume that prospective students and families know this, and take it into account when applying to schools. We tested this in our survey and over half of college leaders thought people knew they would get a discount. Three out of four college leaders at private not-for-profit institutions though that students knew they would not pay sticker price due to tuition discounts. Many college leaders also thought sticker price would not cause prospective students from looking at a school.
Other research indicates that this is just not the case, however. A 2013 survey by Longmire and Company, Inc. indicated that: “Approximately 4 in 10 students and parents say they rejected colleges on the basis of their published sticker price alone. Six in ten say they are unaware that “colleges discount their published price so that incoming freshmen pay less than what is published.”
This is a remarkable mismatch. Forty percent of potential students reject a school out of hand purely on sticker price. Even more have no idea that tuition discounting ameliorates the sticker price. This is a very large sector of the population that think they cannot afford an institution when it might be affordable. The sticker price shocks them. Yet the people setting that price think that what they are doing is well known.
It’s not. Obviously, this is one of the big problems with college tuition. And there are more that are in the report I did with the Chronicle. I’ll talk about a few more in subsequent blog posts, but you probably want to get that report. It's got a lot of good information for college leaders as well as prospective students and their families.