Office of Planning and Budgeting

Although other nations continue to outperform the U.S. in terms of educational attainment, the Pew Research Center reported yesterday that record numbers of young Americans are attending and completing college. Of Americans aged 25 to 29 in 2012, 33 percent have completed at least a bachelor’s degree and 63 percent have completed some college—up from 17 and 34 percent respectively in 1971.

The NY Times noted that this is welcome news following the “education reversal” of the early 2000s, when the percentage of young Americans (ages 25 to 29) earning bachelor’s degrees leveled off and was surpassed by the share of “prime age adults” (ages 45 to 64) receiving degrees. Now, this trend “has vanished or been reversed by recent improvements in the education attainment of young adults,” according to the report.

The authors posit that more young Americans may have recently pursued (and earned) degrees in higher education as a means of weathering the job drought caused by the 2007-09 Great Recession. However, the report acknowledges that the portion of young adults attending and completing college has generally increased since 1980. This long-term trend it attributes to improved public opinions regarding the importance of a college education. According to a 2010 Gallup survey, 75 percent of Americans agreed that, in order to get ahead in life, a college education is necessary (up from only 36 percent in 1978).

Unfortunately, the fact remains that other countries are not only achieving higher levels educational attainment than the U.S., their rate of improvement outpaces ours. If the U.S. is to reclaim its title as a global leader in higher education, we will need greater gains than this in the coming years.

A landmark study from 1990 classified 212 US institutions as liberal arts colleges, but new research shows a 39 percent decline in that number—only 130 institutions currently meet the original study’s classification criteria. Of the 82 institutions no longer classified as liberal arts colleges, a handful were subsumed by larger institutions, while about half had shifted their mission away from the standard liberal arts definition.

Historically, definitions of liberal arts colleges (including Carnegie Classifications) have highlighted their focus on undergraduate studies; selective admissions; small class sizes; emphasis on nurturing diverse perspectives and personal growth; and de-emphasis on cultivating professional skills. According to the more recent study, however, many liberal arts institutions are now offering more “professional” programs and incorporating more research into their curricula. The authors speculate that liberal arts colleges may be making this shift away from their standard definition in response to economic pressures. For example, schools may be attempting to:

  • Offset dwindling revenue streams by attracting new segments of the market;
  • Remain competitive in a market flooded by online and for-profit institutions; or
  • Accommodate students’ increased focus on vocational preparation.

To expand on that last point, recent federal and state-level preoccupation with graduates’ potential earnings has put liberal arts colleges in a difficult position as degrees in traditional liberal arts fields (i.e. social sciences and humanities) may be less lucrative for graduates than other degrees (i.e. professional or STEM degrees). For example, according to CollegeMeasures.org, the average first-year earnings of a graduate with a four-year degree in the State of Virginia are about $30,000 if the degree was in sociology or about $46,000 if the degree was in civil engineering.

A widely-regarded strength of the US higher education system is its diversity. However, if liberal arts colleges shift their missions to include the research and career-preparatory goals of other schools, the system may become more homogeneous—leaving students with fewer educational options.

For the first time in 15 years, fewer students are enrolling in higher education overall. Enrollments at public four-year and private non-profit institutes actually increased, but falling for-profit and two-year enrollments pulled down the average. According to preliminary data released this week by the U.S. Department of Education’s National Center for Education Statistics, colleges and universities eligible for federal financial aid experienced a 0.2 percent decrease in their total enrollments between Fall 2010 (21,588,124 students) and Fall 2011 (21,554,004 students). Although slight, this drop could indicate that fewer individuals are using some sectors of higher education as a refuge from the recent recession and/or that rising tuition rates are driving students out of some markets. Regardless, the new trend could be problematic for those advocating for higher education attainment as well as for universities hoping to derive more revenue from increased enrollments.

Some specific findings include:

  • For-profit institutions were hit the hardest. Enrollments dropped by 1.9 percent at four-year for-profits and by a whopping 7 percent at two-year for-profits. This is likely due to tougher federal regulations on for-profits as well as for-profit institutions deciding to use more selective admissions practices.
  • Two-year institutes struggled, while four-year schools continued to thrive. Two-year enrollments (across all sectors) are down by an average of 2.4 percent, while four-year enrollments are up an average of 1.2 percent. Much of the two-year drop was driven by the aforementioned drop in two-year for-profit enrollments; however, California’s recent limit on community college enrollments can also help explain the decrease in two-year numbers.
  • Part-time enrollments grew, but full-time enrollments shrunk. About 0.8 percent more students enrolled in part-time programs (across all sectors), whereas 0.8 percent fewer students enrolled in full-time programs. Two possible explanations are that the job market has recovered enough to keep more students employed or that more students now need income to support themselves during school.

UW enrollments reflect those of four-year public institutes across the country. Total enrollments at four-year public institutes increased by an average of 1.5 percent from Fall 2010 to Fall 2011. UW’s total enrollments (undergraduate and graduate students combined) increased by 1.6 percent from Fall 2010 (49,940 students) to Fall 2011 (50,745 students) and by another 1.6 percent from Fall 2011 to Fall 2012 (51,576 students). For more UW enrollment statistics, see the OPB Factbook.

Last Friday, the U.S. Department of Education released its annual update on federal student loan cohort default rates (CDRs) and, although national CDRs are gloomily high, UW’s rates are impressively low. As the Department is in the process of switching to a more accurate three-year CDR measure, this year’s report includes both the FY 2010 two-year and the FY 2009 three-year CDRs. These rates represent the percentage of student borrowers who failed to make loan payments for 270 days within two or three years, respectively, of leaving school.

The Department provides breakdowns of its data by institution type, state and school. Here are some key findings:

Nationally

  • The FY 2010 two-year CDR increased from 8.8 to 9.1 percent overall. Public institutions increased from 7.2 to 8.3 percent, private nonprofits increased from 4.6 to 5.2 percent, but for-profits decreased from 15.0 to 12.9 percent (though their two-year CDR is still the highest).
  • The FY 2009 three-year CDR is 13.4 percent overall (this is the Department’s first year reporting three-year data) with public institutions at 11 percent, private nonprofits at 7.5 percent, and for-profits at 22.7 percent.

Locally

  • UW’s three-year CDR is a remarkable 3.1 percent—more than 10 percentage points below the national average.
  • UW’s two-year CDR increased slightly from 1.4 to 2.1 percent, but is still well below the national average.
  • The State of Washington’s three-year CDR is 11.3 percent—below the national average, but still above approximately half the states.

Unfortunately, the Department does not release loan default rates disaggregated by student demographic (even though it collects this information), which prevents schools from identifying and catering assistance to students with the most need. While third-parties have conducted studies indicating that Pell Grant recipients and Latino students are more likely to default on loans, schools and legislators need better data from the federal government in order to fully identify at-risk groups and mitigate rising default rates.

As a recent post discussed, if you attend college, you are more likely to earn more money. But, as you might imagine, the financial value of higher education depends on what program you choose and where.

Information on the annual earnings of students from different programs and institutions is exactly what Sen. Ron Wyden, a Democrat of Oregon, and Sen. Marco Rubio, a Republican of Florida, hope to provide. Their recently-introduced “Student Right to Know Before You Go Act” proposes creating a state-based, individual-level data system linking the average costs and graduation rates of specific programs and institutions to their graduates’ accrued debt and annual earnings.

Although useful, Senator Wyden acknowledged that such information is limited and that focusing on financial indicators alone could undermine the importance of liberal arts—whose graduates may not earn large salaries right after college. He stated that the bill’s intention is “to empower people to make choices.” However, “people” include not just students, but policy makers—such as Florida’s Governor Rick Scott who sparked controversy last October when he asserted that state money should go to job-oriented fields, rather than fields like anthropology which, he said, do not serve the state’s vital interest.

Regardless of the bill’s success, about half of the states already have the ability to link postsecondary academic records with labor data. And some, such as Tennessee, have already done so. Here in Washington, the Education Research and Data Center is in the process of connecting certain employment and enrollment data for schools, such as the UW, to analyze in the coming months.

All this begs the question: Is college chiefly for personal economic gain?

A recent report by the College Board highlights both the financial and nonfinancial payoffs of college. Additionally, David A. Reidy, head of the philosophy department at University of Tennessee Knoxville, stated in a recent Chronicle article that four-year degrees, particularly in liberal-arts, are not solely for job training. “The success of the American democratic experiment depends significantly on a broadly educated citizenry, capable of critical thinking, cultural understanding, moral analysis and argument,” he wrote. Philosophy and other core disciplines help nurture such a citizenry, he continued, “And the value there is incalculable.”

The US Departments of Treasury and Education teamed up to analyze higher education and economic data, and released a short report that highlights the following familiar points:

  • Education is correlated with higher earnings: median weekly earnings for a worker with a BA degree are now 64% higher than for a worker with only a high school degree.
  • Education is key to socio-economic mobility: almost half of children born into the bottom income quintile remain there as adults compared to only 20% of those who receive a degree.
  • Funding cuts result in higher tuition: Public funding for institutions has, on average, declined from 60% of revenue to less than 40% over two decades while tuition revenue has increased by almost the same amount of the decline.

As a result of the above, federal financial aid has become an increasingly important contributor to college affordability, comprising over half of all grants and loans awarded to students. While protecting and increasing federal funding for aid is imperative, the report makes clear that states and institutions will have to make changes as these trends continue or broad access to higher education in the US will be at serious risk.

The Public Policy Institute of California (PPIC) released a report addressing the effects of state disinvestment on enrollment rates in Californian higher education institutions. California high school graduates, despite applying and being eligible for enrollment, are less likely to enroll in the UC or CSU system today than five years ago. The report blames this decline on state cuts in higher education spending, which has led to skyrocketing tuition and enrollment limits at California schools. While California community colleges have absorbed some of this decrease, the report finds that students are increasingly going out-of-state or not enrolling in college at all.

Highlights from the report include:

  • Enrollment rates of Californians at UC and CSU have fallen by one-fifth in the past five years, from 22 percent of CA high school graduates in 2005 to 18 percent in 2010.
  • UC and CSU have rationed enrollment and increased tuition in order to blunt the effect of decreasing state support on educational quality. Tuition rose by 50 percent between 2007 and 2011 at UC, and by 47 percent at CSU.  Tuition at CA community colleges has also almost doubled in that time.
  • UC has reduced its campus enrollment targets and places students not accepted to their campus of choice into a referral pool, which grants them admission to less popular campuses where they are less likely to enroll. CSU now requires a higher SAT/GPA combination for CA students that live further from their chosen campus in an effort to limit enrollment. Community colleges cannot officially deny enrollment, but they have increased class sizes and decreased program offerings which effectively limits slots.
  • Most students accepted to UC who decide not to enroll there, go to private institutions, usually out of state (34 percent).  30 percent enroll at CSU, 12 percent to community colleges in California, 8 percent to public schools out of state, and 10 percent do not enroll in college at all.

The report finds these trends troubling, since it represents a great loss of human capital to California. Estimates say that two out of five jobs in CA in 2025 will require a bachelor’s degree; if current trends continue, California will be short one million bachelor’s degree holders by that time. The report recommends locking in tuition for four years for each incoming class, offering deferred tuition payment plans, reinvesting in higher education and increasing the availability of financial aid to students in order to combat decreasing enrollment rates. To read the full report, click here.

Jeff Selingo’s recent blog post on the Chronicle of Higher Education website summarizes conversations he had with students at six higher education institutions about majors, job skills, and online learning. His findings were somewhat surprising and ran counter to many current trends in higher education. First, he learned that students, while completely immersed in the online world otherwise, do not favor online learning. Instead, they crave face-to-face, personal interactions with students and professors. Second, students feel unprepared for choosing a major and a career, and more counseling would be useful in helping students find their ideal career path. Finally, students do not think majors matter that much—instead of pursuing career-specific majors, students want a broad education that exposes them to many disciplines and prepares them to be good learners and thinkers.

As a student, I can relate to most, if not all of Selingo’s findings. I have never taken an online class at the University of Washington, and few undergraduates I know have. Those that have taken online courses say it is much more difficult to stay motivated and keep up with the material when there is no class to go to and no professor or TA to notice if you fall behind. As an International Studies major, discussion and group work are central to my studies and difficult to replicate online. While such classes are likely helpful for non-traditional, working students finishing their degrees, they are not a perfect replacement for an interactive classroom experience.

Selingo’s assertion that students want more career exploration before college is likely accurate, though I know efforts made both in K-12 and higher education in Washington to help students choose careers and majors. The culminating project and High School and Beyond Plan students complete at the end of high school in Washington State is meant to help students identify their interests and strengths and decide on future career and educational goals. FIGs and TRIGs at UW can help students gain an introduction to prospective majors, and career and academic advisors give lots of opportunities for students to explore potential career paths. While certainly not all students seek out help, there are many options and resources for students that look for them.

The finding that surprised me most was that the students Salingo interviewed thought majors did not matter and were not interested in career-specific learning. While most students I know follow their passions and interests when selecting a major, I believe the economic downturn has made my peers more practical about their choices. A student might major in accounting or business instead of economics, or major in biology and pursue their interest in theater in their free time. Many students add second, more job-skills focused majors or minors late in their undergraduate education in order to make themselves more competitive in the job market. Often, internships solicit applications from specific majors like business, engineering or computer science, which pushes students to consider these majors over others in order to get relevant job experience.

To read more of the Chronicle blog post, please click here.

Demos, a research and advocacy organization, recently published a report entitled “The Great Cost Shift” discussing the effects of higher tuition and lower state investment on a growing and diverse college population. The report focuses on the Millennial generation, the group of students born in the 1980s and 90s and beginning to enter college in the 2000s.

 There were 26.7 million young people (ages 18-24) in the US in 1990, and 30.7 million in 2010. This population growth combined with increased participation in higher education created a 37.9 percent undergraduate enrollment increase in public universities over 20 years. Additionally, the Millennial generation is characterized by much greater racial ethnic and racial diversity than previous generations (12.3 percent are African American, 57.2 percent are white, and 20.1 percent are Hispanic). Both the growth and diversity of the young adult population has altered the needs of students, and institutions have had to adjust both services and support as a result.

These changes in the number, type and needs of students over the last 20 years has been accompanied by a steady disinvestment of state governments in higher education, which resulted in significant  tuition increases. The very institutions, public, that have absorbed the majority (65.5%) of enrollment increases have also endured the largest decline in funding per student (26.1% decline in real terms from 1990-2010). As a result, public four-year institutions raised tuition by 112.5 percent, adjusted for inflation, over the same time period while the real median household income rose just 2.1 percent.

While states and institutions have often offset these tuition increases with larger financial aid packages for student with need, it is increasingly not enough to cover students’ educational expenses, and students borrowed 4.5 times more in 2010 than in 2000.

The report concluded with a number of recommendations:

  • Recognizing that lower investment in higher education results in higher tuition and lower access for low and middle-income students, states should appropriate more money to higher ed, especially investing more in large institutions that produce a significant number of degrees.
  • Reform the tax system to relieve the tax burden on low and middle-income families.
  • States should move away from merit-based aid and focus on need-based financial assistance. They should also increase awareness about the benefits of federal student loan programs to decrease the volume of private debt students take on.

To read the entire report, please click here.

Excelencia in Education has produced a report that summarizes college attainment rates within the Hispanic population in all fifty states. The report is intended to highlight the importance of increasing higher education participation and graduation rates among Hispanics if the US is to reach its ambitious attainment goals.

According to the report, Latinos are expected to be 20 percent of the US population by 2020, and because they have a median age that is significantly younger than average (27 compared to 40), over 25 percent of the 18-29 year old population. Yet in 2011, only 21 percent of Latino adults had an AA degree or higher compared to 57 percent of Asians, 44 percent of Whites, and 30 percent of Blacks.

The report’s Washington State profile shows a sizable Hispanic population in Washington and a large attainment gap:

  • Washington has the 12th largest Latino population in the US
  • The median age among Latinos in Washington is 24 compared to 40 among other groups
  • Latinos currently comprise 16% of the K-12 population in Washington
  • 18% of Latino adults (age 25-64) in Washington State have attained an AA degree or higher compared to 43% among others

This report makes even clearer what many employers and higher education officials and experts have known for years: there is much progress to be made in increasing college attainment within the Hispanic population, and as a significant and growing percentage of the  overall population, such gains will be a key factor in whether the US can meet the ambitious goals it has set for college attainment.

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