Higher education has been the bedrock of our society for over 300 years, with just under 4,000 degree-granting institutions. Recently, however, skyrocketing tuition costs have created several challenges and have the general public questioning the value and purpose of higher education. With much public outcry on the value proposition of higher education, can the industry be sustained or reinvented? Many articles have been written about higher education “landlords,” as institutions compete for students based on amenities and facilities. This intense competition for colleges and universities to attract students has resulted in expensive amenities and accommodations to convince students to attend. While this is a nice to have for students, it has also driven up the cost of a college degree to the point where many cannot afford a degree.
As competition increases and state and federal subsidies decrease, these additional costs are passed on to students. The question for higher education is how to find cost reductions and efficiencies to offset the growing amenities abundance. The astounding $1.747 trillion dollars of student debt is growing six times faster than our nation’s economy, and the average public school student borrows $30,000 for a bachelor’s degree. Policymakers are proposing that taxpayers solve the student debt crisis through loan forgiveness, while businesses are offering to pay employees’ student loans to attract talent. Regardless of the proposed short-term solutions, none are addressing the root of the problem.
Dr. Shawntel Landry, President of American College of Education, is a passionate advocate for finding innovative ways to solve the rising costs of education and provide a return on investment for students. As she articulated, “Those at the upper end of the financial spectrum will get help from parents for college; those are the lower end of the financial spectrum will be eligible for grants and subsidies; however, we are out-pricing the middle class if something does not change in our higher education cost structures.” Landry recently facilitated a solutions-oriented discussion on these critical issues with top leaders in banking, retail, hospitality, and healthcare.
Specifically, the discussion involved Keith Banks, Vice Chairman of Bank of America; Ken Ohashi, CEO of Brooks Brothers; Peter Strebel, Chairman of Omni Hotels & Resorts; and Erik Wexler, President of Operations for Providence St. Joseph Health. All of the panelists have strong passions and ideas about the future of education, support tuition assistance for employees, and believe corporations have a role to play in our education ecosystem.
From Ken Ohashi’s perspective, education is critical, because “all deserve a chance to realize their potential for success, and education is the key to narrowing the wage gap.” Erik Wexler rightly identified that education helps “alleviate health disparities in our communities. More education equals more healthy and less sedentary community members.” From the financial perspective, Keith Banks articulated that “education is foundational for all things in life; any breakdown in the educational fabric of our country will be devasting for our future generations.” Peter Strebel summed up the importance of education this way: “Education is one of the ways to end fear – fear of crime, job loss, and poverty. More education is needed to eliminate fear so all can thrive.”
Education is all about hope – hope for opportunity, change, development, and potential. “Knowledge is powerful, and hope is powerful,” said Wexler. But for education to realize its full potential (and end fear as Strebel so eloquently described), then it needs to be available to all. What does available for all mean? Our panelists felt this notion was the start of a vision of education for the future.
Both Strebel and Ohashi identified the needs for more recognition of all education and all training, not just higher education degrees. Wexler rightly identified that we must have more innovation in all sections of higher education. Our service economy will continue to grow and thrive in the coming years and education opportunities abound in this area, but how do we make sure all students have exposure to various options and opportunities?
Banks described a “more cohesive educational stack” on the K-12 through workforce continuum. On this continuum, K-12 would align to post-secondary options of career, technical, and higher education needs. Then post-secondary education would align to the workforce needs of corporations. This continuum would be filled with partnerships at each level, and these partnerships would lead to feedback loops up and down the continuum, so each level was preparing students for their next level. Higher education, and career and technical education, is a service industry that provides education, training, and experience. One could argue that students are the customers of higher education, but a counterpoint is that students must be prepared for jobs. So, are students or employers of those students the customers? Are they both customers? An alternative view is that the customer of any post-secondary education is the one paying the bill. Regardless of the definition of customers, it is clear that one vision our leaders articulated was the alignment of curriculum and needs across the entire education continuum.
Along the lines of the education continuum, Strebel shared this thought: “We must get more involved with students prior to the college or university setting to ensure they have direction for their future.” Think about the opportunities if we were able to do this – starting at an early age to build synergies and determine what students needed to be successful in their next education segment, whether that segment was higher education, trade school, career college, university, or employment. Strebel emphasized that in his vision for the future, options are needed for all pathways, as not all students want or need a university degree. But all students do need to see future pathways, understand their options, and know what it takes to achieve those options.
Ohashi felt Strebel’s sentiments mirrored his vision of conversations starting early about providing more career ladder opportunities and ways to recognize all education. We all know that education occurs both inside and outside of classrooms, but we have conditioned students to think that classroom-based education is the only option. Ohashi envisions employers “thinking differently.” From his point of view, “employers need to be thinking about job requirements. Is a bachelor’s degree really the price of admission for so many jobs?” Ohashi sees this gap in the marketplace – where employees have skills and training, but maybe not formal academic credit. Employers can work to recognize that experience and reward workers for knowledge gained. This leads to one of Landry’s visions for the future – that all earned education is recognized as viable and valid, not just academic credit.
According to Landry, “I envision a future where all of a student’s learning is articulated and compiled into the most efficient and effective pathway toward a credential.” From her perspective, this recognition of all knowledge acquisition is exactly what Ohashi and Strebel are suggesting is a potential solution for the future of higher education.
Envisioning a new future for higher education means addressing the current concerns about the value proposition. Banks thinks we can do that by understanding that “a degree is a means to an end. We should have employers tell universities what they need in employee education so students are employable; employers have a vested interest in this. This would be the fastest way to increase return on investment (ROI) for students: make sure they can get out of school, get a job, and get on an earnings curve.” Strebel and Wexler agreed and Strebel stated that “corporations have a responsibility to be part of the solution through education and trainings that benefit both the employers and employees.”
This partnership between education and workforce is occurring in some regions of the country, but it is not widespread, and our leaders believe it must be, which circles back to the notion of employers as stakeholders of higher education. As stakeholders, they need a voice in what our institutions of higher education produce. In this future scenario, there is a regional cooperative between employers in the region and all of those producing learners, or potential employees. Employers have a stake in the current and relevant content taught by education institutions, which leads to employers assuring and securing internships that can lead to future jobs for those students. This would be the “greatest collaboration between companies and colleges,” according to Banks, and led to solid ROI for students and our institutions. Ohashi believes this “seamless connection between schools and employers” – at all levels – must be part of our future.
This deep-seated collaboration is a beautiful vision for the future and addresses part of the value proposition. But as Wexler stated, “We have to be careful that there is not a transference of higher education costs to corporations who are also trying to make a bottom line.” Any education vision for the future must address the current rising costs of tuition, and institutions have a responsibility to deliver high-quality and affordable education. Cost reductions and efficiencies, along with any bloat, much be investigated and discovered so we can actually lower the cost of education. In so many cases, addressing the rising costs are met with strategies to increase revenue, and while this is helpful, work also needs to be done on strategies to reduce costs.
Just as the healthcare industry has healthcare imperatives, we are at a critical junction in the higher education industry. Our panelists believe the higher education imperative is to innovate and determine how to lower the costs for higher education, so all students are served and our country prospers.
Innovation can begin with these short-term and long-term strategies: 1) More recognition and acceptance of all knowledge acquisition, 2) alignment of curriculum, training, and needs across the entire education continuum, 3) seamless connection between higher education curriculum and employers needs, and 4) reduction of costs through efficiencies. Wexler eloquently expressed the group’s thoughts at the end of the conversation: “We have a crisis. Let’s not waste the crisis. The education industry needs to do something and do it fast.”