Combatting Declining Faith in Higher Education Requires Prioritizing Economic Outcomes
Last week, following months of negotiations, federal lawmakers introduced bipartisan legislation that would expand eligibility for need-based grants under the federal Pell Grant program to students enrolled in high-quality, short-term workforce programs. That such a compromise was possible points to a broad and growing consensus about the need to align postsecondary education with career outcomes and economic opportunity.
Students and their families are asking tough questions about the value of pursuing higher education. Research shows that the majority of college students say getting a good job is their primary motivation for pursuing a degree. Unfortunately, far too many institutions are struggling to deliver on those expectations. According to the Federal Reserve Bank of New York, 40 percent of recent graduates are underemployed and working in jobs that do not require their degrees. It’s no surprise that the public’s faith in higher education is on a steep decline.
As we think about the year ahead, it is clear that college leaders, employers, and policymakers will need to work together to couple more tightly the design and regulation of postsecondary institutions with the return on investment that students are starting to expect. Here are three ways to better ensure that higher education lives up to its promise and pays off for all students.
Embrace Innovative Models
Colleges and universities are increasingly getting the message that, in order to connect students with economic opportunity, they need to embrace new models and innovations that keep costs low. Promising solutions exist, including online and hybrid learning, competency-based learning, innovative financial models that encourage students to spend less, and efforts to control non-essential costs. But affordability is only one part of the value equation. Institutions must also work diligently to help students persist and complete their degrees, all while designing learning outcomes that align with the future of work. After all, an affordable credential means little if it doesn’t lead to economic opportunity.
Crucially, colleges and universities need to be transparent about their outcomes—even when their results do not paint them in a favorable light—and remain focused on continuous improvement. To that end, innovative leaders in higher education are measuring the success of their institutions based in significant part on the economic outcomes of their graduates and on whether their students’ wage gains outweigh their higher education costs.
Partner with Employers
Employers are hungry for college graduates with the knowledge, skills, and abilities needed to succeed in the workplace, but in a recent survey, four in 10 business leaders said that they believe recent college graduates are unprepared. Likewise, in a separate survey, just 41 percent of graduates felt they had the skills needed to be successful in their first job.
Employers are learning that they have an important role to play in helping to develop a reliable, high-quality pipeline of talent. Cutting-edge business leaders are pursuing agile and productive collaborations with higher education institutions in the design, delivery, and assessment of jobs-oriented programs. Google, for example, has partnered with many colleges to integrate its Career Certificates into degree programs so that students can learn valuable workforce skills while completing their credentials. Also, more and more employers are hiring based on skills rather than pedigree, a critical step toward more equitable employment. Recent LinkedIn data shows that 40 percent of companies use skills to identify job candidates, a 20 percent increase from the previous year.
Focus on Economic Opportunity in Policy and Accreditation
State and federal policymakers and college accreditors loom large in any realignment of higher education toward economic opportunity. As a triad, they regulate higher education and control access to the vast public subsidies on which almost all colleges and universities rely. On this front, too, change is afoot.
The Department of Education and various committees on both sides of the aisle in Congress are drafting reforms that will require institutions to disclose (and, in some cases, meet minimum thresholds for) the earnings of their graduates. A common goal of these laudable efforts is to create incentives for institutions to improve their students’ return on investment.
Equally promising, some accreditors are taking steps to measure and hold institutions accountable for earnings outcomes, particularly for whether the wage bumps that students experience from attending an institution are large enough to compensate them in a reasonable time frame for their costs. These innovative accreditors are also pressing institutions to be more transparent about their outcomes, prices, and designs.
In its essential role to connect students with economic opportunity, our system of higher education is falling short. Fortunately, a movement that prioritizes economic outcomes in higher education is gaining traction, driven by a unified and urgent ask from students that our colleges and universities protect and improve their economic future. For that movement to succeed and for higher education to thrive as an engine of economic mobility and opportunity for all students, a full and lasting commitment to economic outcomes in our colleges and universities will be needed from institutions, employers, and regulators alike.
