In previous columns, I discussed the long-term rapidly rising in-state charges at U.S. public colleges and universities. These costs have been driven by massive administrative headcount bloat, emphasis on research over teaching, and excessive compensation for both tenured faculty and administrators (slightly offset by underpaid teaching assistants and adjunct faculty).
Enabled or even propelled greatly by federally sanctioned student loans, costs have risen much faster than students and families’ ability to pay. When students finish college, with or without a degree, many of them and their parents have crushing student-loan burdens and have received often dubious value for their time and money. Those without a degree may or may not have gained knowledge and skills they need, but employers will usually under-compensate them.
As a Nevada regent for eight years, I observed all these phenomena in our system.
A key problem of public higher education is the same as for K-12 public education and all the public sector: The enterprises are usually run for benefit of the employees, not for benefit of students, other clientele, taxpayers and families paying the bills, nor for the public interest.
Like communications, railroads, airlines and other industries in the past, higher ed has become a cartel protected by government from effective competition. It thus fails to experience necessary productivity growth and business-model innovation. Such cartels and public agencies have essentially captive clientele, and for that reason have become sclerotic and inwardly focused.
So, they are caught off guard when innovative business models, often using new technology, disrupt the incumbents and provide consumers by-pass opportunities. The Covid-19 pandemic and associated shutdowns, coupled with modern electronic communications and information systems, have suddenly disrupted higher ed and shown students and families bypass options, not customer oriented.
The internet and many distance-learning technologies are often less expensive than classroom delivery and in many cases as effective or more for learning. With entrepreneurs learning how to deliver one-to-many and network-based instruction and content with these technologies, the costs of brick-and-mortar campuses, administrative excess, subsidized research and bloated compensation are jeopardized.
Students can avoid housing and board costs by not living on campus. As one who has benefitted extensively from higher education, I value greatly the on-campus experiences. But not everyone gets the same value from them. And with home delivery methods, they can often get by without student loans.
Many portions of standardized four-year degree programs deliver little value to students but provide income streams for faculty and administrators. Associate and baccalaureate models have dominated nearly every field in modern colleges. However, many students are better served by limited-scope proficiency certificates, apprenticeships, technical training, etc.
The fraction of high school graduates going on to higher ed has increased over time because these other options were not generally available. Now that they are, we have too many students in colleges and universities. This contributes to lowering of standards and to longer time taken to earn first degrees.
Also, faculty and administrators have indulged distribution requirements and weak academic programs in critical theory, identity studies, political activism and vapid sophistry: social justice, diversity, inclusion, equity, privilege, intersectionality, woke-ism, coercive collectivism and radical environmentalism.
Entrepreneurs have managed even to make profits by offering the things students need and want without bundling them with the distribution and weak academic dreck they don’t want or need.
What to do?
Some institutions should innovate and diversify with offerings and methods that match the disruptors. With economies of scope and scale due to their current offerings, they may often be able to effectively compete in this manner.
Where they cannot compete directly with disruptors, they should retrench their current offerings to those that disruptors can’t match. Beginning social sciences, humanities, math and science can often be taught effectively on line if students have opportunities to ask questions in interactive sessions. But colleges have real advantages in engineering and architectural design, performance in arts, advanced projects, etc.
Above all, they should be brutal on cutting costs and insisting on productivity gains, even at the expense of some internal constituencies. And stop depending on growth, which won’t materialize. Finally, don’t depend on increasing real budgets. Or bleating bromides and tired old mantras to defend the status quo.