June 25, 2012 NY Times
By Jeff Selingo
Washington – NO matter what the University of Virginia’s governing board decides today, when it is scheduled to determine the fate of the university’s ousted president, Teresa A. Sullivan, the intense interest in the case shows how much anxiety surrounds the future of higher education — especially the question of whether university leaders are moving too slowly to position their schools for a rapidly changing world (as some of Ms. Sullivan’s critics have suggested of her).
There is good reason for the anxiety. Setting aside the specifics of the Virginia drama, university leaders desperately need to transform how colleges do business. Higher education must make up for the mistakes it made in what I call the industry’s “lost decade,” from 1999 to 2009. Those years saw a surge in students pursuing higher education, driven partly by the colleges, which advertised heavily and created enticing new academic programs, services and fancy facilities.
The almost insatiable demand for a college credential meant that schools could raise their prices and families would go to almost any end, including taking on huge amounts of debt, to pay the bill. In 2003, only two colleges charged more than $40,000 a year for tuition, fees, and room and board; by 2009, 224 were above that mark. The total amount of outstanding student loan debt is now more than $1 trillion.
Students were not the only ones to go deeper into debt. So did schools, building lavish residence halls, recreational facilities and other amenities that contributed little to actual learning. The debt taken on by colleges has risen 88 percent since 2001, to $307 billion.
This heady period of growth occurred precisely when colleges had the financial flexibility to prepare for what was to come: fewer government dollars, a wave of financially needy students, a drop-off in the number of well-prepared high-school graduates who could afford to pay, and, of course, technological advances in teaching and learning. Instead, colleges continued to focus on their unsustainable model, assuming little would change.
Other information industries, from journalism to music to book publishing, enjoyed similar periods of success right before epic change enveloped them, seemingly overnight. We now know how those industries have been transformed by technology, resulting in the decline of the middleman — newspapers, record stores, bookstores and publishers.
Colleges and universities could be next, unless they act to mitigate the poor choices and inaction from the lost decade by looking for ways to lower costs, embrace technology and improve education.
One urgent need is to make better use of technology in the classroom. Despite resistance to the idea from academics, evidence suggests that technology can reduce costs, improve student performance and even tailor learning to individual students. The nonprofit National Center for Academic Transformation has redesigned courses on more than 200 campuses, cutting costs by an average of 37 percent, by using instructional software to reduce burdens on professors, frequent low-stakes online quizzes to gauge student progress, and alternative staffing (like undergraduate peer mentors).
Schools should also offer more online education. In just the past few months, several elite universities, including Stanford and Harvard, have announced multimillion-dollar efforts to provide several of their courses free, online, for everyone. Individual colleges should take advantage of this trend, perhaps ultimately shedding their lowest-quality courses (and their costs) and replacing them with the best courses offered by other institutions through loose federations or formal networks. This is the idea behind the New Paradigm Initiative, a group of 16 liberal-arts colleges in the South that have joined together to offer online and hybrid courses to students on any campus in the group.
Another key reform would be to reclaim academics as a top priority. Administrative expenses have grown faster than instruction on many campuses. In 2009, the consulting firm Bain & Company identified $112 million in annual savings just within the business operations at the University of California, Berkeley.
Academia also needs to cut back on low-quality graduate programs. Too many universities tried to become research institutions during the lost decade, adding graduate programs and research faculty, often using tuition dollars to finance their expansions. Today, too many of these programs remain far short of their goals, and their ambitions have come at a great cost to their core mission of educating undergraduates (as well as producing many dropouts and unemployed Ph.D.’s).
Finally, colleges should work to reduce the number of wasted credits. Most students take far more than the 120 credits required for a bachelor’s degree, partly because of poor advising and partly because colleges often refuse to accept credits from other institutions or for “prior learning.” Yet one-third of students today transfer from one college to another before earning a degree. Colleges make transferring credits difficult, often in the name of protecting academic quality, when often they are simply protecting their bottom line.
Higher education is a conservative, risk-averse industry. Add to this the fact that a majority of its leaders are nearing the safety net of retirement, and we have a recipe for the status quo. We can’t afford another lost decade.
Jeff Selingo, editorial director at The Chronicle of Higher Education, is writing a book on the future of higher education.