Changing Higher Education

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The coming shortfall in workers with postsecondary credentials

The Georgetown University Center on Education and the workforce has just published a fascinating report entitled Help Wanted: Projections of Jobs and Education Requirements through 2018:

The Georgetown University Center on Education and the Workforce shows that by 2018, we will need 22 million new college degrees—but will fall short of that number by at least 3 million postsecondary degrees, Associate’s or better. In addition, we will need at least 4.7 million new workers with postsecondary certificates…..

The shortfall—which amounts to a deficit of 300,000 college graduates every year between 2008 and 2018—results from burgeoning demand by employers for workers with high levels of education and training. Our calculations show that America’s colleges and universities would need to increase the number of degrees they confer by 10 percent annually, a tall order.

Their analysis suggests that most workers with a high school diploma or less are working in 3 occupational clusters that either pay low wages or are in decline.  Job growth is to be found in those areas that require non-repetitive tasks, jobs that typically require some level of postsecondary education.

As noted above, the shortfall in postsecondary degree and certificate recipients will be very difficult to fill in. Given the constraints (both fiscal and mission) on the non-profit world of higher education, it is unlikely to be the major source of the needed additional graduates. 

For-profit higher education institutions, because of their flexibility, costs, and access to capital, are likely to move most aggressively to provide the needed educational opportunities.  Indeed, according to the Chronicle of Higher Education, a recent Eduventures report predicts that :

For-profit universities will have 42 percent of the adult-undergraduate market by 2019, nearly doubling their current share…

By that time, for-profits will lead both public and private universities in the number of adults enrolled. They will have approximately 60,000 more adult students than will publics, and 800,000 more than privates.

I have not seen the report, but these predictions certainly must be based on analyses such as can be found in the Georgetown report.   I made similar points with respect to the situation in California in an earlier post.

As the powers-that-be in Washington move to control some very real abuses by some members of the for-profit higher education world, let us hope that they note the critical role that that world will play in meeting the educational needs of the next decades.  New rules should certainly address egregious behavior, but without destroying the badly needed innovation and drive that the sector brings to higher education.

Wal-Mart brings higher ed to its employees

                                                        
 
Wal-Mart recently announced that it would be offering many of its employees an opportunity to work on a college degree through an agreement with American Public Education, Inc (APE).  APE offers online degree programs through the two components of its American Public University System (APUS), American Military University (AMU) and American Public University (APU).  APUS is accredited by the Higher Learning Commission of the North Central Association. AMU focuses on providing education for active military personnel; APU focuses on the non-military working adult. Eligible Wal-Mart employees will get a 15% discount on tuition at American Public University, and Wal-Mart is setting up a $50M tuition aid fund as well.  According to a June 3 article in the New York Times (NYT1), Wal-Mart executives said that the “point of the program was to help employees get more education and to build a better work force.”

Wal-Mart is known as provides an enormous range of competitive quality “everyday” products at very low prices.  The business model that enables it to sell its merchandise at such low prices is both much admired and much maligned, and need not be discussed in detail here.  However, one component of that model is to drive very hard bargains with its suppliers, requiring both low prices and appropriate, competitive quality.  Thus one would not imagine that Wal-Mart would pick an educational provider without due diligence and an understanding of what it wanted to buy. Indeed, according to a June 9 article in the New York Times (NYT2), before picking APU:

Wal-Mart surveyed 81 institutions, including for-profits, nonprofits, online universities, brick-and-mortar colleges, and “even some of the open-source, open-platform online offerings that are out there,” said Alicia Ledlie Brew, senior director of Wal-Mart’s lifelong learning program.

The criteria Wal-Mart used in making its decision paralleled those used in its usual relationships with suppliers, according to NYT2:

It had several criteria: a program with clear, low pricing (American Public charges $250 a credit hour, a price that has not changed in 10 years, Mr. Boston (President and CEO of APE) told the UBS audience); one that was accredited; a college that offered a variety of degrees and course subjects; and one that was used to dealing with adult students.

Because Wal-Mart is so large (1.4M employees in the US), and because it has transformed retailing in the US and many other parts of the world, it is important to consider about some of the implications of this arrangement.  

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Wal-Mart executives said it decided to work with an online university instead of a brick-and-mortar school after surveying more than 32,000 of its employees and learning that most of them wanted the scheduling flexibility afforded by online classes. (NYT1)

This result, of course, is not very surprising. Indeed, flexible scheduling is one of the main requirements most working adults have when they consider returning to higher education. It is also not surprising that Wal-Mart decided to go with a for-profit university since few non-profit universities both have extensive on-line degree programs comparable to those found in the for-profit sector, and are flexible in their dealings with large potential client corporations. 

In pitching their programs to Wal-Mart, APE’s President and CEO Dr Wallace Boston and his team:

stressed the organization’s history of offering classes to the nation’s more than one million military personnel. These students are often older than conventional undergraduates, hold jobs and work shifts at various times of day in different time zones. (NYT2)

One must assume, therefore, that the normally demanding executives of Wal-Mart looked at the programs and outcomes of AMU and found them to be of a standard they found appropriate.   In the process, they must have considered Daniel Golden’s article For-profit Colleges Target the Military with its many mentions of AMU, as well as the many negative articles that followed as Golden and others pummeled the for-profit world for what they viewed as its excesses and shortcomings.  The resulting contract seems to indicate that Wal-Mart must have concluded that Golden and his followers had not made their case, at least as it applied to AMU.

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The partnership with American Public University, a for-profit school with about 70,000 online students, will allow some Wal-Mart and Sam’s Club employees to earn credits in areas like retail management and logistics for performing their regular jobs…. For instance, a department-level manager, who receives training from Wal-Mart in areas like pricing, inventory management and ethics, would be eligible for 24 on-the-job credits, at no charge, toward a 61-credit associates’ degree. A cashier would be eligible for six credits toward a 61-credit associate’s degree or a 120-credit bachelor’s degree. (NYT1)

All studies of the adult education world clearly demonstrate the importance to prospective students of gaining a credential (degree), as opposed to simply taking a set of courses, no matter how pertinent they may be.  This agreement enables employees at Wal-Mart to get credit towards a degree for the training they already are receiving from their employer, thus facilitating their quest for the desired credential.   It might well increase the value of their Wal-Mart training in their minds at the same time. Thus this component of the arrangement was probably quite central for both Wal-Mart and its employees.

More than half of all higher education institutions give some kind of credit for learning outside the classroom, so this arrangement is not unusual per se. In addition, such credit for prior learning has recently been shown in a study funded by the Lumina foundation to correlate strongly with success in persistence to the degree: students receiving such credit had graduation rates more than 2 times higher than those of students who had not received such credit, and the difference held regardless of institutional size, level (2 or 4 year), and institutional control (for-profit, non-profit public or private).  

A key to the ultimate (rather than short term) success of this program is whether the prior credit given is based on a rigorous, credible process.  Many Wal-Mart employees will eventually seek to transfer some of the academic credit awarded by APU to other institutions, and if it is not accepted, the negative impact on employee moral could be significant.     

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Wal-Mart clearly recognizes that size alone makes this a very visible corporate educational program, one which may ultimately be as influential in the adult education field as Wal-Mart itself has been in the retail field.  In a letter to Secretary of Education Arne Duncan, Wal-Mart showed that it has ambitions of playing a leadership role in pushing the adult education field to levels of increased effectiveness:

“While there is broad agreement about the need for more Americans to attain college degrees, we recognize that there is a healthy discussion under way about the best way to get there,” wrote Leslie Dach, Wal-Mart’s executive vice president for corporate affairs and government relations. “One of our aims with this program is to try some innovative approaches that seem promising, grounded in what is already known in the field.”

He added: “We hope in this way to expand the education and employer communities’ knowledge of what works most effectively, so that policy makers, other companies and other stakeholders can continuously improve such offerings.”(NYT1)

Dach also said in his letter that Wal-Mart “will work with third party experts to evaluate the impact and effectiveness of this program.”  One imagines that APU will welcome these evaluations, and use them to modify and improve their own approach as time goes on.   At present, APU is a relatively small player in the field of for-profit higher education.  However, if it effectively and rapidly transforms the results of these evaluations into improved educational approaches, the visibility this program could move it into a leadership role in adult education.

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Some commentators have decried the fact the Wal-Mart chose to go with a for-profit university rather than a non-profit college or university.  They charge that the degrees obtained will have little or no validity in the rest of the world, and that the employees will, in effect, be cheated.  I think that charge deserves some additional consideration.

First, as I have pointed out in earlier posts, we actually have no data to demonstrate that the education that for-profits provide is less effective than that at non-profits.  For simplicity, I am willing to stipulate that the education provided at the top 200 of the approximately 4000 accredited non-profit colleges is superior to that provided at any of the non-profits, although there is no data to support that stipulation.  However, I believe that a large fraction of the for-profits provide an education that is equal or superior to that provided by a similarly large fraction of the remaining 3800 accredited non-profit colleges.  Many of the for-profits simply spend more developing courses, bringing in advanced pedagogy, and evaluating student outcomes than do most of the non-profits. So, there is no a priori reason to believe that the Wal-Mart students will be cheated in the quality of their instruction.   

Secondly, while there is no doubt that at this time degrees from most for-profit institutions generally are viewed less favorably than degrees from most non-profit institutions, there are reasons to believe that view may be changing.  In reality, many corporations are working with major for-profit higher education providers to offer advanced opportunities to their employees, including degree programs.  For example, both Kaplan University and the University of Phoenix have programs focusing on this market.   This has numerous consequences.  Perhaps most importantly, the sheer number of students in this group assures that graduates of for-profit universities increasingly will be moving into responsible managerial positions in corporations all across America.   As more of these graduates move into positions of responsibility, they will increase the respectability and brand value of the degrees.  As some of the successful graduates move to other companies, they will take a respect for the brand with them to the new company.  Equally significant, in companies that have such education programs, HR offices clearly will treat candidates with degrees from for-profit universities more positively.

 The Wal-Mart  program, because of its potentially very large number of students and the visibility of the employer, looks suspiciously like a significant step forward in the evolution of for-profit higher education as a disruptive innovation ( as described by Christensen.)

 

 

 

Security in East Asia, and the soft-power role of higher education

As I struggle with imagining what globalization might mean for higher education, I have come to appreciate finding new sources that help me to increase my understanding of political and business trends around the world.  I was recently introduced to a very interesting journal that has been very useful in helping me to look at some of these issues from a distinctly non-US perspective.  The journal is Global Asia, a publication of the East Asia Foundation in Seoul, Korea.  In some ways, this is Foreign Affairs with an Asian perspective.  Its goal is:

to provide a compelling, serious, and responsible forum for distinguished thinkers, policymakers, political leaders and business people to debate the most important issues in Asia today

It seeks to represent no fixed point of view or agenda, and so contains articles representing a wide variety of primarily Asian viewpoints on a multitude of issues.   It is sometimes jarring but greatly informative to see the ways various events are perceived in different countries of Asia, and the often significant gap between those perceptions and the dominant American perceptions.

The most recent issue (Spring 2010) contains a number of very interesting articles, as well as a “Cover Story” of eight articles on the theme: Security in East Asia: The Pieces of a New Architecture.  Authors from China, Japan, Korea Singapore, and Russia provide viewpoints on this security issue that are strongly shaped by events, politics, and histories of their own countries. Two Americans add their thoughts on the role the US should be playing in this important development. 

The Cover Story focuses on new security architectures that might provide increased cooperation on economic and political issues that undergird regional security.  As such, most concentrate on what might be called “hard issues”.  Interestingly, only one of these eight articles even mentions a role for the “soft power” of higher education in helping to provide long term security and stability for East Asia.   In this “outlier” article, Cho Hyun, Deputy Minister for Multilateral and Global Affairs at the South Korean Ministry of Foreign Affairs and Trade, points out the importance of soft power in building security, particularly through the contribution to cooperation and mutual understanding that can come through increasing interactions of the peoples of the countries of the region.  One such interaction that he mentions occurs through higher education. Cho points out that in 2008: more than 200,000 students chose to study in countries outside their own within Northeast Asia rather than going to other countries (the US and Europe).

Of course, it is not at all unusual for people struggling with difficult and important questions of regional security to give short shrift to consideration of softer aspects such as higher education. However, it is the case that one of the goals implicit in the ongoing Bologna process has been to use higher education to help forge a shared identity in the region that in turn will bring increased security to a region that has known centuries of fierce internal conflict:

A Europe of Knowledge is now widely recognised as an irreplaceable factor for social and human growth and as an indispensable component to consolidate and enrich the European citizenship, capable of giving its citizens the necessary competencies to face the challenges of the new millennium, together with an awareness of shared values and belonging to a common social and cultural space.

In an earlier post (An Asian Bologna Process moves forward, Dec, 2008) I reported that the member states of ASEAN had begun to consider a Bologna –like process for higher education in that region for similar reasons. Indeed, the website for the ASEAN Education Members Meeting contains an opening statement that contains sentiments very close to those of the Bologna statement:

Education underpins ASEAN community building.  Education lies at the core of ASEAN’s development process, creating a knowledge-based society and contributing to the enhancement of ASEAN competitiveness. ASEAN also views education as the vehicle to raise ASEAN awareness, inspire the “we feeling”, and create a sense of belonging to the ASEAN Community and understanding of the richness of ASEAN’s history, languages, culture and common values.

The communiqué of January 28, 2010 describing the 5^th ASEAN Education Ministers Meeting indicates that they, indeed, are beginning to move along many paths similar to those being followed in Bologna, although details are sparse.

It will be interesting to continue to follow the ASEAN process, and see if it becomes successful enough that the next round of articles on regional security will see it as a factor worthy of mention.