A Rational Optimist’s View of American Higher Education

If ever there was a “Winter of Discontent” for higher education in the United States, the last decade or so has been it.

The media and the public at large seem to be increasingly “discontent” with American colleges and universities, and we have all heard the list of complaints: Costs are soaring, teaching methods are outdated, not enough students are completing degrees, and the United States is falling behind the rest of the world in producing the educated scientists and engineers who will keep us competitive in the 21st century.

With a great “Harrumph!” Time recently ran a cover story asking the decidedly discontented question: Is College a Lousy Investment? (McArdle, 2012).

It is time to pause, take a breath, and look at what is really happening—behind the screaming headlines. As the famous humorist Mark Twain once drily commented after the New York Herald printed the unfortunate news that he was gravely ill and about to expire in a London hotel room, “Reports of my death are greatly exaggerated.”

And so it goes with American colleges and universities.

Problems do exist, and individual institutions and entire systems can and should be doing more to rein in expenses, improve student success, and produce more graduates in high-demand fields. But when it comes to the three chief complaints you are probably hearing the most about—cost, completion, and competitiveness—higher education in this nation is far from expired.

In fact, you can cheer up, because when you take a careful and clear-eyed look at the figures behind the frenzy, you will find there is plenty of reason for a more rational optimism.

Cost

Here is the complaint:

Colleges and universities build Taj Mahal dorms, overcharge students, and fleece the government for financial aid. Accumulated student loan debt in America has reached nearly $1 trillion, more than automobile and credit card debt, and second only to mortgage loan debt. On top of that, students are racking up more than $100,000 in loans pursuing Liberal Arts degrees, only to find themselves unemployed or working as a barista at Starbucks.

Sound familiar?

While there may be a kernel of truth to some of these claims (just as Mark Twain’s cousin, James Ross Clemens, really was ailing in England), the whole picture is not nearly as dire as the doomsayers would have you believe.

According to the National Center for Education Statistics (NCES), the amount that most public colleges and universities are spending per student has remained relatively flat for at least the last seven years, increasing only $321 in inflation-adjusted dollars, from $28,050 in 2005-2006 to $28,371 in 2011-2012 (NCES, 2013).

The big difference is not that colleges are spending lavishly, or even spending much more than they did before. It is that the cost of college, among public institutions, is shifting from state support to student and family support. As an example, according to an analysis by a special Higher Education Finance Commission established by the State Legislature last year, Massachusetts, where my college is located, used to provide 80% or more of the funding for community colleges and state universities, and now that figure ranges from 25-50% (Higher Education Finance Commission, 2014).

Each year, the State Higher Education Executive Officers Association (SHEEO) issues a report on the condition of higher education finance in America. SHEEO’s State Higher Education Finance 2013 edition notes that “constant dollar educational appropriations per FTE” (that is, the amount of money spent by states and counties per full-time equivalent student) reached a high of $8,790 in 2001. By last year, it had fallen to $6,105 (SHEEO, 2014).

Clearly, when it comes to policy and funding, a college education these days is more often seen as less of a public good and more of a personal good, with the expectation that states will pay less and students will pay more.

On top of this shift of college costs from the government to students and families, the huge increase in overall student loan debt is driven not just by individuals borrowing more for college, but by more people going to college. According to the NCES (2014), between 1991-2001, enrollment at degree-granting institutions in America increased at a moderate 11%. Then, between 2001-2011, enrollment soared 32%, from 16 million to 21 million students.

Keep that number in mind, because when you hear about the “average student loan debt” (which is now around $27,000), that typically refers to the amount of debt taken out by all borrowers, not to debt accumulated by all 21 million students at American colleges and universities. As William Deresiewicz (2014) noted in “The Miseducation of America,” a recent Chronicle of Higher Education column, “Forty-three percent of those who graduate from public colleges and universities, which account for about 70 percent of the college population, don’t take out any loans at all.”

If you count all students, in 2012 the average debt per graduate (from a public college or university) was about $14,000. To put that in perspective, last year the average price of a new car in America was just over $32,000—and a few years later, you still have to buy another one.

And what about those borrowers taking out more than the cost of your first home? Well, the reality, according to Deresiewicz (2014), is that less than 2% of students graduate with over $100,000 in debt, and most of those are coming from expensive private schools.

Choice matters. Students who attend highly selective and expensive private schools in pursuit of careers that pay lower wages may find themselves deeper in debt, while the larger number of students who attend less selective and less expensive public universities and community colleges likely emerge with a more manageable balance sheet.

And what about results? Whether I’m $14,000 in debt or $100,000 in debt, I will never pay it off as a barista at Starbucks, right?

Poor Starbucks. To help counter the negative image they have acquired as the last refuge of supposedly unemployable English and Art History majors, the international coffee giant recently announced the “Starbucks College Achievement Plan,” a new partnership with Arizona State University (ASU) that will help their employees complete their college degrees: All those baristas who work at least twenty hours a week will receive 50% tuition for freshmen and sophomores, and a free ride for juniors and seniors at ASU (Starbucks, 2014).

But the reality is that even through the recent recession, the college educated (including English and Art History majors) were far better off than those without degrees, and now, according to the U.S. Bureau of Labor Statistics (2014), the unemployment rate for college graduates is only 3%. On top of that, over the course of a lifetime of work, college graduates can expect to earn about a million dollars more than those who only finish high school.

The Brookings Institution’s “Hamilton Project” recently examined what college graduates in various majors earned over their careers, and whether their investment was worth it or not. While there is quite a bit of variation between a social worker and a chemical engineer, they determined that a typical student’s spending on college has a financial return of over 15%, more than twice the average return of a stock market investment over the past 60 years (Hershbein & Kearney, 2014).

A college education still does not have to cost a fortune, and in most cases, it will be well worth the investment. Read past the ranting headlines and know that there are choices to be made along the way.

Completion and Competitiveness

Here is the complaint:

Teaching is outdated, students are bored, and not enough of them graduate. The United States is falling behind countries around the world. We have too many underemployed Liberal Arts students and not enough Science, Technology, Engineering, and Math (STEM) graduates.

There is some real truth to this one. Figures vary widely by institution, state, and region, but as Paul Tough (2014) of New York Times Magazine recently reported in “Who Gets to Graduate,” taken as a whole, more than 40% of American students who start at four-year colleges have not earned a degree after six years, and if you include community college students, the dropout rate is more than half.

And when you stack us up against other developed nations, at first glance we seem to be losing ground. The Organization for Economic Cooperation and Development (OECD) produced a report last year called “Education at a Glance,” comparing emerging and economically advanced countries around the world. According to the OECD (2014), the United States now ranks fifth in the attainment of a college degree among 25-64 year-olds (behind the Russian Federation, Canada, Japan, and Israel), and twelfth when considering 25-34 year-olds.

Lastly, since Thomas Friedman published The World is Flat, his bestselling look at globalization and the looming threats to America’s economic and educational dominance back in 2005, a number of reports from reputable business groups and think tanks called for a significant increase in the number of STEM graduates to fuel the 21st century hi-tech economy.

In his 2011 State of the Union address, President Obama pledged to create 100,000 new STEM teachers, and soon after, his Council of Advisors on Science and Technology (2012) issued a report declaring that the United States needed a million new STEM workers.

Fair enough. Without question, we need to improve both the rate and the number of students who graduate from college in the United States prepared for the world of work—and we are.

In America’s agricultural and industrial past, the vast majority of citizens did not even contemplate going to college. According to the U.S. Census Bureau (2014), in 1947, only 6% of 25- to 29-year-olds had earned a college degree. But thanks to the G.I. Bill, a boom in the creation of community colleges across the nation, and an economy that increasingly relied on advanced technology and needed more educated workers, by 1977 that percentage had increased to 24%.

After inching along throughout the 1980s and 90s, the drive toward improved college completion started to get a real boost a decade or so ago, when philanthropists, foundations, and organizations like Bill and Melinda Gates, Achieving the Dream, and Complete College America joined higher education leaders across the country in a renewed focus on student success.

As an example, the Lumina Foundation’s (2013) Goal 2025 initiative boldly declares, “By 2025, 60% of Americans will hold a high-quality college degree, certificate or other postsecondary credential.”

How are we doing?

Well, the most recent report from Lumina, “A Stronger Nation Through Higher Education,” reveals that in 2012, the most recent year for which data are available, the proportion of Americans between the ages of 25 and 64 with a two- or four-year college degree was 39.4% (Mathews, 2014). That’s up from 38.7 in 2011, and is the largest year-over-year increase since Lumina started tracking our progress.

Degree attainment in the United States, according to Lumina, is steadily accelerating.

And there is more to look forward to: The degree attainment rate of young adults (ages 25-34) helps predict what the future will look like, and in 2012 that rate was up to 41%, three percentage points higher than in 2008 (Mathews, 2014).

And when it comes to the next big breakthrough in college completion and competitiveness, one of our nation’s biggest challenges—the way we educate our most at-risk citizens—is also one of our greatest opportunities.

Unlike many of the countries surveyed in the OECD’s “Education at a Glance” report, the United States has a robust higher education system that is open to everyone, regardless of gender, ethnicity, social, political, or economic background.

This is most evident in our network of “open door” community colleges across the country—an option for higher education that America invented, and most countries around the world have yet to discover.

Community colleges serve nearly half of the nation’s undergraduates, and the largest proportion of at-risk students, including first generation students, minorities, students from low-income families, students with learning disabilities, veterans, and more.

We can be proud of opening the doors of higher education widely to everyone—and it is through the challenges we find with at-risk student populations that we also have our greatest opportunities for improving completion and competitiveness even farther and faster.

For example, as that New York Times Magazine investigative story recently reported, two of the most rapidly growing populations of students on college campuses across the country are low-income and minority students; yet these are also two of the groups of students least likely to complete college (Tough, 2014). Tough writes, “Whether a student graduates or not seems to depend today almost entirely on just one factor — how much money his or her parents make. To put it in blunt terms: Rich kids graduate; poor and working-class kids don’t.”

About a quarter of college freshmen whose families are in the lower half of the income distribution will complete a bachelor’s degree by the time they are 24, while almost 90% of freshmen from families in the top income quartile will finish their degree (Tough, 2014).

Similarly, minority enrollment in higher education has been climbing rapidly, while completion rates still lag behind.

According to a Diverse magazine report on recent U.S. Department of Education statistics, between 2009 and 2011, the nation’s Black undergraduate population rose 8.5% and Latino undergraduates jumped 22%, while White college enrollment increased only 2.7% (Roach, 2014).

In a twist that may have been unexpected for many, for the first time in our nation’s history the college-going rate of Hispanic students is now higher than both white and black students.

Yes, you read that correctly: In 2012, seven out of ten Hispanic high school graduates went to college.

And there are more of those high school graduates. According to the Pew Research Hispanic Center, the high school dropout rate for Hispanics has fallen by half over the last ten years, from 28% in 2000 to 14% in 2011 (Fry, 2014).

The optimistic news is that all those colleges, philanthropists, and foundations focused on “closing the gaps” in student success for at-risk students are beginning to have an impact. While minority enrollment was climbing between 2009-2011, at the same time, six-year graduation rates for Latino, White, and Black students increased by 4.7%, 2.1% and 2%, respectively (Fry, 2014).

It is nowhere near enough, but it is progress. And encouragingly, “closing the gaps” for at-risk students has become a regular feature of statewide higher education system planning and even resource allocation. According to the National Conference of State Legislatures (2014), 25 states now have some kind of performance-based funding for their public colleges and universities, and many of those, like Massachusetts, where my college is located, include metrics for how well institutions are serving at-risk students.

Those colleges and states understand what the Massachusetts Department of Higher Education (2014) noted in this year’s progress report on our statewide Vision Project: “If African-American and Latino/a adults possessed college degrees at the same rate as White adults (60%), Massachusetts would easily meet its need for more college graduates by 2025.”

And what about all those STEM graduates we need in order to stay competitive with the rest of the world?

There is no doubt the world economy and workforce has become more technologically advanced, but there is growing skepticism that a million more STEM degrees are what we need to keep up.

In Falling Behind?: Boom, Bust & the Global Race for Scientific Talent, Harvard Law School Professor Michael Teitelbaum (2014) explains that that the United States has been through at least five STEM-related cycles since World War II. Each time, Teitelbaum writes, concerns about a perceived shortage of STEM workers led to action by the federal government to stimulate STEM research and education. Then, after the panic and stimulus ended, we were left with too many STEM degrees and not enough STEM jobs (think Sputnik and the technology race of the 1960s, followed by the economic bust of the 1970s).

Instead of “falling behind,” Teitelbaum (2014) suggests the United States already has a surplus of people with STEM education—perhaps as much as twice as many as the workforce will demand in the coming years.

So if it still seems that the higher education “Winter of Discontent” you have been hearing about is howling outside your frozen window panes, take heart:

A college education remains one of the best investments you can make.

More Americans are college-educated than ever before in our history.

We are beginning to “close the gaps” in college success for at-risk students.

And the rest of the world still looks to America as a higher education leader: A recent report from the Pew Charitable Trusts (2014) revealed that the number of foreign students studying in the United States has skyrocketed, with more than 886,000 enrolled on American campuses last year. That is an all-time high and more than twice the number of international students 20 years ago.

We have work to do—and we can be optimistic about our future.

References

Deresiewicz, W. (2014, June 19). The miseducation of America. Chronicle of Higher Education. Retrieved from: http://chronicle.com/article/The-Miseducation-of-America/147227/.

Fry, R. (2014, October 2). U.S. high school dropout rate reaches record low, driven by improvements among Hispanics, blacks. Pew Research Center. Retrieved from: http://www.pewresearch.org/fact-tank/2014/10/02/u-s-high-school-dropout-rate-reaches-record-low-driven-by-improvements-among-hispanics-blacks/.

Grovum, J. (2014, November 25). More international students on campus, especially in some states. Pew Charitable Trusts: Stateline. Retrieved from: http://www.pewtrusts.org/en/research-and-analysis/blogs/stateline/2014/11/25/more-international-students-on-campus-especially-in-some-states.

Higher Education Finance Commission. (2014). Report to the General Court of Massachusetts. Retrieved from: http://www.mass.edu/hefc/HigherEducationFinanceCommission-FinalReport10-2014.pdf.

Hershbein, B., & Kearney, M.S. (2014, September). Major decisions: What graduates earn over their lifetimes. Retrieved from: http://www.hamiltonproject.org/papers/major_decisions_what_graduates_earn_over_their_lifetimes/.

Lumina Foundation. (2013). Strategic Plan 2013-2016. Retrieved from: http://www.luminafoundation.org/advantage/document/goal_2025/2013-Lumina_Strategic_Plan.pdf.

Massachusetts Department of Higher Education. (2014). Vision project: Degrees of urgency: Why Massachusetts needs more college graduates now. Retrieved from: http://www.mass.edu/visionproject/_documents/2014%20Degrees%20of%20Urgency%20-%20Vision%20Project%20Annual%20Report.pdf.

Matthews, D. (2014). A stronger nation through higher education. The Lumina Foundation: 2.

McArdle, M. (2012, September 17). Is college a lousy investment? Time.

National Center for Education Statistics. (2013). Expenditures of public degree-granting postsecondary institutions, by purpose of expenditure and level of institution: 2005-06 through 2011-12. Retrieved from: http://nces.ed.gov/programs/digest/d13/tables/dt13_334.10.asp.

National Center for Education Statistics. (2014). Fast Facts: Postsecondary Enrollment Rates. Retrieved from: http://nces.ed.gov/fastfacts/display.asp?id=98.

Obama, B. (2014, January 25). State of the Union Address. Retrieved from: http://www.whitehouse.gov/the-press-office/2011/01/25/remarks-president-state-union-address.

OECD. (2014). Education at a Glance 2014: OECD Indicators, OECD Publishing. Retrieved from: http://dx.doi.org/10.1787/eag-2014-en.

Performance-Based Funding for Higher Education. (2014). National Conference of State Legislatures Web Site: http://www.ncsl.org/research/education/performance-funding.aspx.

President’s Council of Advisors on Science and Technology. (2012, February). Report to the President: Engage to excel: Producing one million additional college graduates with degrees in science, technology, engineering, and mathematics. Retrieved from: http://www.whitehouse.gov/sites/default/files/microsites/ostp/pcast-engage-to-excel-final_2-25-12.pdf.

Roach, R. (2014, July 13). Report: Steady college enrollment growth for underrepresented minorities, college completion rates increasing more slowly. Diverse. Retrieved from: http://diverseeducation.com/article/54837/.

Starbucks College Achievement Plan. Retrieved from: http://www.starbucks.com/careers/college-plan.

State Higher Education Executive Officers. (2014). State Higher Education Finance 2013. Retrieved from: http://www.sheeo.org/sites/default/files/publications/SHEF_FY13_04292014.pdf.

Teitelbaum, M. (2014). Falling behind?: Boom, bust & the global race for scientific talent (pp. 25-70). Princeton, NJ: Princeton University Press.

Tough, P. (2014, May 15). Who gets to graduate? New York Times Magazine.

U.S. Bureau of Labor Statistics. (2014, December 5). The employment situation – November 2014. Retrieved from: http://www.bls.gov/news.release/pdf/empsit.pdf.

United States Census Bureau. (2014). CPS Historical Time Series Tables. Educational Attainment. Retrieved from: http://www.census.gov/hhes/socdemo/education/data/cps/historical/.

About the Author

Dr. Lane Glenn is president of Northern Essex Community College (NECC), with campuses in Haverhill and Lawrence, Massachusetts. Prior to his appointment, Dr. Glenn served as Vice President of Academic Affairs at NECC. Before he joined the Northern Essex staff he served as Dean of Academic and Student Services at Oakland Community College in Auburn Hills, Michigan; and on the faculty at Lansing Community College in Lansing, Michigan. Lane has a diverse background in education and the performing arts that includes more than 20 years of teaching and administration, alongside work as an actor and director for the stage, television, and films. As a researcher, author, and consultant for higher education professionals, businesses, and the social sectors, he has produced articles and workshops on topics ranging from behavioral styles and team building, to conflict management, strategic planning, change management, leadership through storytelling, academic master planning, student development at commuter colleges, and learning styles in the classroom and in the workplace. He has served for more than ten years as a facilitator for the Chair Academy, and is a certified Appreciative Inquiry facilitator.