The Pulse of Higher Ed

I wrote recently about a post-COVID-19 economy and the acceleration toward a new economy or what some deem as the Fourth Industrial Revolution. In the long and short run, many industries will change dramatically including higher education. Retail and healthcare will never be the same, as they are certain to employ new technologies and processes in preparation for future pandemics. As heartbreaking as the situation currently is, COVID-19 has forced many of us to adopt new ways of living and new forms of communication and technology to try to regain normalcy. 

 

As a result, the fragility of the higher education economic model has become more exposed after decades of raising tuition while not increasing value at the same rate. For many complacent institutions with faculty and staff resisting change for the past decade, the need to survive now circumvents any opportunity to thrive or innovate. To establish continuity, many institutions created bridges to campus-based students through remote instruction. Remote instruction is only softening the blow for revenues already earned by the institution. After this Spring semester comes to a close, institutions will find themselves with many more courses and degrees in an online format. However, it is unlikely that they’ve created a competitive advantage or new stream of revenue, as thousands of other colleges and universities have also moved their campus-based programs online. It will be difficult to monetize these newly transformed offerings into future additional revenues, let alone stem the lost revenues for Fall 2020 as a result of an anticipated decline in enrollments. The decline in enrollments will be a result of many not being able to afford college due to economic changes, while some will question going to college given COVID-19 and thus take a gap year. Others will see fully online as a direct and more efficient path from high school to college. So, how does higher education pivot post-COVID-19? It needs to look at the dynamics from a multi-dimensional perspective.

 

Many things have changed. The dynamics of the marketplace have changed. Consumer or student perspectives toward higher education have changed. Student financial stability has changed. The ability to afford college has changed. The ability to access college has changed. The student now has more choices and access, less money and more scrutiny of higher education. The one thing that the current new student has gained is…time. With all of these changes happening in such a short window, colleges and universities do have a way to leverage time, financial instability and a weakened job market—through alternative credentials.  Many colleges and universities offer noncredit or stackable credit programs that address many of these challenges. A recent study conducted by UPCEA and MindEdge shows that 70% of institutions are offering alternative credential programs and another 26% were planning to do so soon (pre-COVID-19).

 

• For many graduating college seniors, the challenge of finding an entry-level job just became harder. In a few weeks, they will most likely earn their degree in a normal graded format or pass/fail situation. Regardless, they’ll have their degree, but many will not be fortunate to have a job waiting, let alone interviews or job fairs to attend. A potential solution for these unfortunate folks could be to improve their skills and competitiveness for when companies do begin hiring again. New graduates could enhance their writing and communication skills, analytical abilities or technical skills that will separate them from others.

 

• For the displaced worker, and there are many and there will be many more, finances will be tight. Many of these individuals will have a degree but see their vulnerability should another outbreak occur. Those without a degree may see motivation for a greater purpose. Improving one’s skills for the new economy through Massive Online Open Courses (MOOCs) or a college’s professional programs could be attractive to many. Many individuals will look back at 2020 and seek ways to become better prepared and have greater job stability. They will be more frugal with their spending. More will set aside rainy-day funds and become less dependent on credit cards. While they will attempt to live within their means, education that is communicated strategically and delivers on its promise will be viewed as an investment. The allure and reachability of a full, more expensive degree will no longer be an option for many, thus noncredit programs or alternative credentials may be a more attractive options post-COVID-19.In the weekly Strada Public Viewpoint survey of 1,000 individuals, one-third of Americans expect they will need more education to find a comparable job if they were to lose theirs. When asked about where they would seek that education, 26% say an online college or university, and 17% say online community college.

“Two thirds of the people who feel they will need more education to replace a lost job would seek to change careers. Combining this desire to reskill with significantly lower expectations of employer sponsored courses and training, creates tremendous demand for online pathways to marketable skills and credentials. Online allows education consumers with a career focus to fit education into their hectic lives, rather than have to fit their lives into education.” 

– Dave Clayton, Senior Vice President of Strada Education Network’s Center for Consumer Insights

 

• For the Class of 2021 and future generations of high school graduates, many may see a new path to the new economy. They may forgo their rite of passage of stepping foot on a campus and go straight to an online college or university. Some personality types may see this as a more efficient and economical way of preparing oneself for the new economy. For these practical students of the future, whether they represent 1%, 5% or 10% of a traditional incoming class, the financial model and competition will change. Just 1% of students who would have otherwise gone to a campus, but now take their degree online could amount to several hundred thousand students. Five percent of students moving to this format from a campus-based experience would exceed a million students. They will no longer pay student activity fees, on-campus housing, meal plans and other fees. They will also no longer participate in the campus’ local economy. They will be savvy and more frugal, searching the internet for the best school and the best program at the best value. This disruption is likely to accelerate with each new class of students.Therefore, colleges and universities will need to think differently about their degree models. Given this new potential phenomenon, it is likely that price wars could result until greater value is created. Online delivery alone will not be a competitive advantage, but a prerequisite for consideration. Other considerations will have to take place, such as more content applied to the new economy, stackable credentials, and an easier or more fluid application, engagement and enrollment process between the potential student and the institution. The technology and those who interface with this student of the future will have to be stellar.

 

Despite stimulus funds coming into institutions, most colleges and universities will face significant fiscal shortfalls (as reported in a number of recent media stories). The already precarious financial position of many institutions is more exposed and as a result, new ways of generating enrollments and revenues are critical for survival.

 

Tips for Higher Education in the Short-Term Post-COVID-19

• Prepare for a percentage of traditional campus-based learners now doing their degree fully online. As a result, marketing and enrollment strategies need to be directed and catered to this evolving segment.

 

• Assess where you create value in your programs, portfolio and in supporting students and inquirers. If your institution cannot create or communicate value, then be prepared for a price war if students are unwilling to pay or take loans for education.

 

• Minimize the risk while maximizing workforce potential through alternative and stackable credentials. With greater price sensitivity and competition in the marketplace, creating smaller bundles or packages of education is a viable option. Also, offer these new educational offerings to alumni, as many have become displaced and potentially disenchanted with the fact that their degree did not save their job. The dream and process of buying into a full degree is no longer an option for many.

 

• Assess your touch points and enrollment management of inquirers, applicants and students. Gen Z’ers will come into channels designed for older adults and the institutions that create the best experiences for these savvy consumers will win. This means not only strategically marketing to specific target audiences but scientifically managing a technology-assisted inquiry process…staffed with the right people at the right time with the right information. Eventually, artificial intelligence (AI) will play more of a role, but higher education administrators will need to implement change like many have never seen before.

 

• Narrow the employer/institution gap through strategic integration of leading national or regional employers with the college or university. In a new economy and disrupted workforce, workers and students will want greater assurance of employment. Stronger connections between institutions of higher education and employers will present a stronger front to potential incoming fully online or campus-based students.

 

For more from the 2020 UPCEA MindEdge Survey, download the whitepaper here.

 

About UPCEA

UPCEA is the leading association for professional, continuing, and online education. Founded in 1915, UPCEA membership includes most of the leading public and private colleges and universities in North America. For more than 100 years, the association has served its members through its Center for Research and Strategy, National Council for Online Education, as well as innovative conferences, and specialty seminars. The Center for Research and Strategy is the research and consulting arm of the association, formed to meet the research needs of its members. Based in Washington, D.C., UPCEA also builds greater awareness of the vital link between contemporary learners and public policy issues. Learn more at www.upcea.edu.

Jim Fong is the Chief Research Officer at UPCEA.  He can be reached at [email protected].

 

About MindEdge

MindEdge, Inc., an online learning company headquartered in Waltham, MA, is the underwriter of this research.

Founded in 1998 by Harvard and MIT educators, MindEdge develops higher education and continuing education content and provides innovative technological solutions within the rapidly evolving world of online education. MindEdge has partnered with major universities to provide for-credit courses in a wide range of academic subjects, including English composition, statistics, cultural anthropology, American government, management, and information technology. MindEdge also develops and offers professional development and continuing education courses in a broad array of disciplines, and it provides PD and CE credits and certifications through major credentialing organizations, including the Project Management Institute, CompTIA, the HR Certification Institute, the Society for Human Resource Management, the International Association of Emergency Managers, and the International Association for Continuing Education and Training. Since its founding, MindEdge has served more than two million learners, and remains committed to finding new ways to improve the way the world learns.  Learn more about MindEdge at www.mindedge.com.

 

About the Strada Education Network

Strada Education Network is a national social impact organization dedicated to improving lives by forging clearer and more purposeful pathways between education and employment. The Network engages partners across education, nonprofits, business, and government to focus relentlessly on students’ success throughout all phases of their working lives. Together, we address critical college to career challenges through strategic philanthropy, research and insights, and mission-aligned affiliates. Learn more at stradaeducation.org.