Higher Education: 3 Ways To Save The Industry
As those of you with kids are well aware, school as we once knew it is out, and it may be a while before education-as-usual resumes. This is particularly true for higher ed.
Universities are already anticipating at least partial virtual learning for the fall, which is driving down enrollment, as students struggle to justify the prices and look to avoid room and board fees. And sports programs — the financial lifeline for many universities — see no end in sight, wondering if they’ll shutter their doors and drag many university budgets down with them.
The pandemic is testing the false constants we’ve long taken for granted within higher ed: that education should be available to everyone, must happen in person, and — most significantly — is worth the hefty price tag. Some, like Scott Galloway, are predicting the beginning of the end for higher ed.
While I think it’s far from dead, I do think the current situation is accelerating the call for change. I have always thought that change would come by the time my young daughters are college-aged, but the coronavirus flipped the timeline overnight.
Over a year ago, while writing my book, Embracing Irrationality, I argued that, “In the not-too-distant future, it’s hard to imagine we won’t look back on our current higher education system and laugh at ourselves.” Why? Because “the constant of ‘everyone must go to college to become educated and get a good job’ is a false constant ripe for disruption.” Turns out “not-too-distant future” was only a year away.
While this is the most significant and acute reckoning of false constants that higher ed has dealt with, their woes have been building for some time. Recall earlier last year, when Operation Varsity Blues, the largest college admissions scandal in history, dominated headlines. Now, as the pandemic transforms the college experience, we must take a hard look at the future of the industry.
A Sobering Look at the Current Realities of Higher Ed
Just as the housing crisis in 2008 made us reconsider the idea of home ownership as the cornerstone of the American Dream, this pandemic is asking us to rethink whether every person should and must go to college to be successful.
Let’s examine the numbers.
The average student debt for the class of 2019 was $35,359 (and for many who pursue advanced degrees or attend private universities, it’s much, much higher). As a whole, Americans owe $1.4 trillion total in student debt. For comparison, credit card debt *only* totals $930 billion.
When faced with the prospect of beginning our adult professional lives in such massive debt, we should ask ourselves — not just in the age of social distancing, but every semester: Is a $50,000 per year in-person education necessary and worth it?
The Three-Part Solution
College as we know it is in trouble. Higher ed has slowly become more expensive and less efficient, with few professional and financial guarantees. That doesn’t mean we should abolish the entire system, but as this pandemic has highlighted, there are ample opportunities for irrational visionaries to emerge from within the higher ed system as a response to this crisis.
In Embracing Irrationality, I argued that “this looming disruption can go one of two ways: Either universities will harness the power of irrational visions from within, or they’ll be disrupted by external forces.” Extreme circumstances have sped up this disruption, but how it unfolds and who wins is still being determined.
Here’s my vision for addressing higher ed’s false constants to transform the university system into a more practical preparation for the workplace of tomorrow:
- Align incentives. One of the primary arguments for college is that it is a preparatory foundation for one’s career. Yet, across the board, many would argue that college doesn’t do a great job of preparing most students for the jobs they’ll take after graduation. Universities make money regardless of how well they prepare students or how successful those students become in their professional lives, so there hasn’t been a lot of incentive for them to focus on students’ post-graduate financial success.
What if, instead of paying outright for college, universities took a percentage of your post-graduate income? A version of this model exists in Australia, where students don’t pay back loans until their income reaches a comfortable level. If a student is unemployed, they do not pay or accrue interest.
There’s no reason companies and students can’t also benefit from this incentivization model. What if a company develops a certification process outside of the university system, trains the students and then feeds them directly into a job? Or, they could partner with a university to develop a curriculum that prepares students to work at their company. That company can custom-tailor the education to solve specific real-world problems — and reframe the entire education model in the process.
- Increase efficiencies. Currently, all students are taught the same material in the same way. The potential for virtual learning goes far beyond a group Zoom call. Digital individualization can be a game changer, but how can we offer more customized learning? AI is the key.
In 2017, EdTech investments hit a record $9.5 billion, with the majority of that funding going to AI-driven technology. Education of the not-too-distant future will be AI-powered, and that’s something we should celebrate. Online education already exists, with learning platforms like Khan Academy and Coursera paving the way for a new education model. Plus, let’s not forget that the majority of information is readily available online. And though it may not be widely implemented yet, it’s not hard to imagine an AI-powered learning platform that is catered specifically to you — one that understands your abilities, disabilities, patterns, passions, and adapts on-the-fly to the way you learn — all for just $19.99 per month. This technology will enrich a traditional university education, as well.
Yes, companies (including ours) currently recruit college graduates, but will that always be the case? With more students than ever looking to save money and still be desirable to employers, I’m betting it won’t.
- Expand availability. At the moment, there’s huge value in a degree, but the price tag is a barrier to entry, and university admission is capped based on physical and human resources, which is also limiting. (TBD if universities start widening their acceptance pool if the likely virtual learning mandates continue into the fall and enrollment dwindles.)
There’s no reason the gig economy model and mindset can’t merge with higher ed. People can and should learn more on their own time. Being physically on a campus for semesters at a time is limiting and unrealistic for many people. I’m not suggesting just another for-profit online college, but imagine if you could get an Ivy League-caliber education from anywhere, all while working a paid job? Or perhaps a hybrid model, where you’re learning remotely part of the time, then reaping the benefits of the in-person experience the other half of the time?
These solutions are only a starting place for redesigning an industry that has an extensive influence on society. At some point, we will decide education is measured by the outcome we seek, not simply a university diploma. People were rightfully outraged by Operation Varsity Blues, but for the wrong reasons: Instead of obsessing over the process of getting in, let’s redirect that energy toward enhancing the value of the education we’re fighting for. And by focusing on targeted, incentivized, tech-assisted education rather than just a degree, the entire system is less vulnerable to unforeseen disruptions, like the one we’re currently experiencing.
With a few achievable tweaks to the system, higher ed becomes a different, more equitable game with a sustainable value proposition. The current crisis has highlighted the industry’s cracks and accelerated the changes, but it’s up to us to seize this moment. Now is the time to look to the future.
p.s. This sort of irrational approach to education stems from the formula I lay out in my new book, Embracing Irrationality. Pay what you like and download it for charity today.