Private Sector College Update
Sector in Transformation
Future in Question
2011
Michael J. Cooney
Chair, Wisconsin Educational Approval Board
mcooney@workforce-com.com
2011 – The Year of the
Great Shake Up
2012 – The Year of the
Great Shake Out
Current Issues:
Regulatory Environment
• Tuition Cost
• Gainful Employment Rule
• Quality of Education
• 90 / 10 Rule
• Outcomes
• Rigorous Accreditation Standards
• Transfer of Credit
• Net Price Calculator
• Validity of Programs
• State Attorney’s General
Investigations
• Default Rates
• Continued Congressional
investigations
Validity of
Outcomes Reporting
The Post-Secondary Education Value Proposition
is under attack as never before
Go to college –
live the American Dream?
"Occupy the Ivory Tower”
"Too many [students] have paid too much and been taught
little. They've been ripped off -- but not by the banks or the fat
cats or any of the other stock villains so unwelcome these days
in Zuccotti Park."
“The shortage of skills and knowledge necessary to compete in
today’s global economy is a real and foundational danger to
America's present dominance and future growth.”
ACTA American Council of Trustees and Alumni
College for All?
• Good for the country?
• Good for education?
• Good for students?
• Good for tax payers?
College for All?
$/?
What is the primary function of
post-secondary education
?
What is the primary function of
post-secondary education?
Intellectual Development
“…by nurturing in students the academic and civic virtues,
and their related traits of character.”
Williams College
Workforce Development
“…helping students like you achieve career success —
not just for that first job out of college, but for a lifetime.”
Johnson & Wales University
The three purposes of the University:
To provide sex for the students,
sports for the alumni,
and parking for the faculty.”
Clark Kerr
First Chancellor
University of California, Berkeley
1958-1967
The Recession
Changed Everything
•
•
•
•
Enrollment boom
Decline of public funding
Value shift
Strategy reassessment
Lack of Confidence in the future
An uncertainty driven squarely by consumers and
small-businesses who are worried about their shortterm financial prospects. And it's been going on since
well before Obama took up residence in the White
House.
These are enormous shifts," This kind of uncertainty -a lack of consumer confidence -- can become a selffulfilling prophecy. "We haven't seen stuff like this
since the 1930s."
Moebs Services founder &
Chairman Mike Moebs
Lack of Confidence in Education
“People are just frozen or deferring,
delaying decisions to go to school. The
Average person in the U.S. has become
much more risk-averse and cautious
when it comes to spending or committing
to anything. It’s unrealistic for us to think
that education would be immune from
this.”
—Daniel Hamburger, CEO DeVry Inc.
For-Profit Colleges'
Most Recent Quarterly Enrollment and Revenue,
2011 vs. 2010 Institution
% Change in
New Student Enrollment
American Public University System
Apollo Group
Bridgepoint Education
Capella Education
Career Education Corp.
Corinthian Colleges
DeVry Inc.
Education Management Corp.
Grand Canyon Education, Inc.
ITT Educational Services, Inc.
Kaplan Higher Education
Strayer Education, Inc.
53%
-34%
27%
-36%
-22%
-23%
-12%
2%
n/a
-14%
-30%
-15%
/
Source: Stifel Nicolaus and SEC filings; most recent fiscal quarter
in Revenue
35%
-11%
8%
-3%
-18%
-17%
-1%
2%
10%
-10%
-33%
-8%
Sector in Transformation:
From voracious enrollment growth to stable, modest growth
•
Down sizing/slowing enrollment
•
Selectivity
•
Free trial periods
•
Commitment to Valid Outcomes
To be competitive institutions will need to be:
• Cheaper
• Faster
• & Better
Future Vision
“The next generation of education comes down to
personalized success plans – digital portfolios.”
“The evidence of competency and certification will
come from valid, real-world accomplishments rather
than simply a degree…”
Rob Curtin
Microsoft – U.S. Education
Where the jobs are:
Employment qualifications have become a process of seeking
the perfect (check off all the boxes) employee.
Employers have to believe in the potential of an employee..
Eric Winegardner
Monster Worldwide
Validation of Outcomes
Is higher education worth it?
How do we know?
Are metrics enough?
The true test of an education is the five year
graduate satisfaction rate.
Johnson & Wales University
Validation of Outcomes
Is higher education worth it?
Service Learning-serves everyone.
The job search / career development planning model
puts the responsibility on the graduate.
The “placement” model does serve either the
Graduate or the institution.
Validation of Outcomes
Is higher education worth it?
Career Self Reliance
for a dramatically changing economy