Summary: Gainful employment rules, declining enrollment, and new completion agendas have sent many colleges scrambling. In this article we offer a solution that could narrow some gaps and potentially simplify efforts to better understand and communicate labor market outcomes for students, which is really the heart of all these issues.
News Roundup
The Department of Education recently released a report that says 5% of the nation’s vocational programs do not meet the minimum standards for student success after graduation. This falls under controversial gainful employment rules, which are aimed at making sure that the college programs relying on federal funds disclose certain details — such as how much debt students will walk away with and the employment outlook for particular programs. Just last week a federal court put the gainful employment rules on hold for now, but you can be sure it will be back (read more here). Despite this, the feds still want to say that if programs do not improve, the funding will get yanked.
Emily Richmond, writing for The Atlantic, offers this explanation:
The new regulations come amid a national debate on the relative value of higher education. Tuition costs at both public and private institutions have been soaring, even as many universities and colleges have cut programs and services. The for-profit college sector has come under significant scrutiny, in part because of how quickly it’s been growing. Enrollment is up 160 percent since 2000.
The career programs affected by the new regulations are particularly popular among older adults returning to school in the hopes of improving their career prospects by earning an additional degree or completing a certification program.
There’s a significant financial incentive for the feds to push for-profit programs to improve the career success rates of their students. For-profit institutions account for about 12 percent of all higher education students but, as the policy think tank Education Sector pointed out in a 2010 issue brief on the new regulations, but they “consume 25 percent of all Pell Grant dollars disbursed and 21 percent of all federal student loan dollars.”
If you want to learn more, check out this excellent Inside Higher Ed article by Libby Nelson. Key note:
Vocational and certificate programs that fail to make any of the minimum standards — a 35 percent loan repayment rate, a 12 percent debt-to-income ratio for a typical graduate, or a 30 percent ratio of debt to discretionary income for a typical graduate — in three out of four years will lose eligibility for federal financial aid programs.
According to Education Department data, 193 programs at 93 institutions, or 5 percent of all such programs, failed to meet any of the benchmarks. When the final rule was published last year, the Education Department predicted that 8 percent of programs would fail at least once, but that only 5 percent would lose eligibility for financial aid by failing for three years.
Perhaps more unsettling is the fact that enrollment, which has enjoyed solid growth for the past few years (due to the down economy), is starting decline. Parents and students are perhaps feeling weighed down by high tuition, associated debt, and uncertain job markets.
This Time Magazine article provides some perspective:
More schools have space still available than at any time in at least a decade. Already, in the academic year just ending, many universities had to offer greater discounts just to fill seats. Yet fewer admitted students enrolled, and more than 40 percent of private colleges reported enrollment declines. Even community colleges — drowning in double-digit growth the past few years — experienced enrollment dips this year.
So, three big issues that colleges need to contend with are (1) enrollment, (2) the completion agenda, and (3) gainful employment. If you are a administrator, dean, or faculty member at a college or university (public or private), this is probably keeping you awake at night. We would like to offer a data-informed approach that could help simplify some of these complex issues. More importantly, we think that we can actually hit all three of these topics with the same stone.
Data-Informed Decisions
First, for the past 10 years EMSI has been helping higher education institutions with a broad range of topics such as program planning and research, return on investment analysis, and (most recently) student success and enrollment support. Our services are rooted in regional economic analysis and labor market data, and we have had the pleasure of working with over half of the nation’s community colleges, many universities, and a handful of for-profit institutions.
So how do we help colleges? EMSI provides data, tools, and reports that quickly and easily give colleges (1) access to the information they need to evaluate the labor market for their programs, and (2) the ability to clearly articulate how local careers relate to programs at the college.
We have observed firsthand that colleges that vigorously research their programs and communicate with students about careers and programs have very high success rates. This is evidenced by case studies which you can see here and here. In addition, five of the top 10 community colleges, as recognized by the Aspen Institute’s Prize for Community College Excellence, are active EMSI clients.
So to better address enrollment, completion, and gainful employment, three topics which are tied to student success, here is what we can do:
1. Labor Market Research
The first step in making sure a college’s programs actually lead to good jobs is to research, understand, and evaluate the labor market. This could mean looking at jobs in a specific service territory (say a five-county region), looking at job growth in a particular MSA, seeing broader trends in a state, or even seeing how things have changed nationally. Whatever the geography and whatever the market, our research tool, Analyst, which is used by thousands of planning professionals, can help.
Analyst lets you tap into a current and complete employment dataset that our staff of full-time data analysts collects, organizes, and integrates so you can actually spend your time using it. With straightforward navigation and easy-to-pull reports, Analyst makes it simple to get the data you need. We update the data in Analyst four times a year, and every time we release an update, your account automatically has the most recent data.
2. Communication and Motivation
Many colleges already have a decent leg up on the research side, but a lot of them still struggle to communicate with and motivate students to enroll in and complete programs. So here is a quick, data-informed solution. In a world of big data, more and more people, including students, are really data-hungry or at least more motivated when they see good data. So one of the best things you can do for your students and potential students is to give them some. Talk to them talk about the careers that await. Talk to them about the local economy, the number of people being hired for specific jobs, the trends, and especially how much they could earn in certain jobs.
To help your college give students these vital statistics on the local job market and how they relate to your programs, we have built Career Coach.
Career Coach sits on the college website and allows students and potential students to browse for jobs that interest them. When they find a job, the web-based tool provides key local statistics like how much the job pays, the trends for the occupation, what companies are hiring, and which programs help train for it.
The college can use this tool to actively engage students and get good data into their hands so that they can use it to make better education and training decisions. A student who is more engaged and has more direction is a student with a higher likelihood of succeeding, which will ultimately impact enrollment and retention.
Noel-Levitz’s recent National Freshmen Attitudes Report found that 95% of students say they want to finish their degrees. However, right now only about 46% are actually accomplishing that goal. The culprit? A lack of motivation. Students who see the light at the end of the tunnel (that great career … those higher earnings) will have more motivation to overcome challenges and complete their studies. According to the study, “These findings prove the need for more consistent and constant conversation with students and families about degree planning, goal achievement, and persistence.”
Conclusion
This all boils down to how higher education engages with and helps students. All of the data, all of the research, and all of the communication efforts, while important for complying with regulations, should ultimately be aimed at the success of the student. If we are too focused on just getting students enrolled or the increasing number of rules, regulations, policies, and initiatives, we will certainly become increasingly bogged down, and frankly far to concerned about the wrong things.
This recent article from the Spokesman-Review of Spokane, Washington makes some very key and succinct observations that hit on the heart of the issue. According to the article, most of degrees granted by higher education institutions in Eastern Washington and Idaho are business degrees, followed by social science, health care, liberal arts, and engineering. Here is the key quote:
While that list roughly matches national figures, it doesn’t square with the expectation among workforce experts that the skills most in demand in coming years will be in science, technology, engineering and math disciplines, or STEM.
There are multiple reasons for that disconnect, but a lack of solid information on how a particular degree correlates with a specific job and salary is one that’s receiving new attention. Such information hasn’t been readily available to students.
To overcome this disconnect, higher education (and particularly those institutions that offer more technical/applied programs) first need to do their homework on the economy and labor market (see Analyst for more info) and then, if need be, follow up with significant adjustments to courses so that students will get what they need. After that, as the article indicates, institutions need to prioritize how they communicate with students about the connection of education and careers (see Career Coach for more info).
Students and young people coming up through the education system often have no clue about what to do and they believe that the colleges they enroll in can actually help. Once a student enrolls and then starts to feel directionless, unsure about the labor market or confused about what they should do, they will likely drop out unless the college can intervene.
We have seen some truly great examples of colleges that have this focus and take full advantage of tools, data, and research to help students. Furthermore, if colleges are truly helping their students, it should stand to reason that they will be more than a step ahead of the regulators who seem to have nothing better to do than create heap upon heap of complex rules.
If you would like to learn more or schedule a time to chat, please let us know. And good luck!
Rob Sentz, VP of Marketing | rob@economicmodeling.com | 208.883.3500