Why the University System, as We Know It, Won’t Last .… and What’s Coming Next

It’s easy to sell books and oth­er com­modi­ties on the web. It’s not easy to deliv­er a qual­i­ty edu­ca­tion. But two con­verg­ing trends point toward a future when we will see the tra­di­tion­al uni­ver­si­ty give way to an online alter­na­tive — some­thing I was­n’t will­ing to bank on two years ago. First, Sil­i­con Val­ley is final­ly focus­ing on e‑learning. Udac­i­ty, Cours­era, Kahn Acad­e­my, EdX — they’re all look­ing to lift e‑learning out of a long peri­od of stag­na­tion. And, sec­ond, times are tough, and the tra­di­tion­al uni­ver­si­ty sys­tem does­n’t care enough about man­ag­ing costs, while wrong­ly assum­ing that it has a cap­tive audi­ence.

This week­end, The New York Times took a good look at the financ­ing of a col­lege edu­ca­tion and high­light­ed a few stag­ger­ing data points.

  • The U.S. has racked up more than $1 tril­lion in stu­dent loans.
  • Today 94 per­cent of stu­dents earn­ing a bachelor’s degree take out loans — up from 45 per­cent in 1993.
  • It’s esti­mat­ed that the “aver­age debt [per stu­dent] in 2011 was $23,300, with 10 per­cent owing more than $54,000 and 3 per­cent more than $100,000.”
  • “Pay­ments are being made on just 38 per­cent of the bal­ance of fed­er­al stu­dent loans, down from 46 per­cent five years ago.”
  • Final­ly, state fund­ing of edu­ca­tion is going down, and tuition is going up, which means that the fig­ures above will just get worse.

You don’t need me to spell things out. Pay­ing for a col­lege edu­ca­tion is get­ting unsus­tain­able, so much so that many expect a cri­sis in the col­lege loan mar­ket in the com­ing years. And then you con­sid­er this. Many uni­ver­si­ties seem indif­fer­ent to the dif­fi­cul­ties stu­dents face, if they’re not inten­tion­al­ly exac­er­bat­ing the prob­lem. At one point in the Times arti­cle, E. Gor­don Gee, the pres­i­dent of Ohio State Uni­ver­si­ty, goes on record say­ing, “I read­i­ly admit it … I didn’t think a lot about costs. I do not think we have giv­en sig­nif­i­cant thought to the impact of col­lege costs on fam­i­lies.” Now lis­ten to the lat­est episode of Plan­et Mon­eyThe Real Price of Col­lege (audio), which under­scores a more galling fact — many col­leges think that they gain a com­pet­i­tive advan­tage if they have a high stick­er price. For many schools, low­er tuition is a sign of weak­ness, not strength.

Uni­ver­si­ties can behave this way because they think they have a cap­tive audi­ence. Because col­lege grads still earn con­sid­er­ably more than high school grads, col­leges assume that stu­dents will keep enrolling. But what will hap­pen when cash-strapped stu­dents are pre­sent­ed with a viable alter­na­tive? It may take 10 to 20 years, but I would­n’t be sur­prised if a new breed of school emerges, schools that throw away the four year mod­el (and the human­i­ties too) and offer stu­dents a very tar­get­ed online edu­ca­tion in “prac­ti­cal” fields — from account­ing to cod­ing to nurs­ing to law and busi­ness — at a dra­mat­i­cal­ly low­er cost. Here, the edu­ca­tion cycle gets short­ened to per­haps two years, and then stu­dents get cre­den­tialed (maybe by a trust­ed third-par­ty provider) and go to work, only to return lat­er in their careers to take more cours­es in spe­cial­ized areas. This mod­el will require the right tech­nol­o­gy plat­form (some­thing that will get worked out fair­ly soon) and a change in the expec­ta­tions of employ­ers and soci­ety more broad­ly (some­thing that will take time to devel­op, but less time than com­pla­cent col­leges think).

The new sys­tem won’t be bet­ter than the cur­rent one in many respects. It won’t offer a round­ed edu­ca­tion. The teach­ing will be less per­son­al. Long-last­ing social bonds won’t be made as eas­i­ly. (You’ll need to pay the big bucks at a tra­di­tion­al school for that. No, they won’t all go away.) And the teach­ing jobs cre­at­ed by these uni­ver­si­ties won’t be ter­ri­bly ful­fill­ing or lucra­tive. But the new sys­tem will offer a more focused and afford­able edu­ca­tion to stu­dents on a mass scale. And when stu­dents grad­u­ate most­ly debt free, they won’t com­plain. Nor will they be forced to forego col­lege alto­geth­er, as some would now advo­cate. There’s per­haps some­thing inevitable about this shift. But the insou­ciance of admin­is­tra­tors and fac­ul­ty inhab­it­ing the cur­rent sys­tem won’t do any­thing to delay it. Stick around, and you’ll prob­a­bly see that I’m right. And if you think my look into the crys­tal ball is wrong, let me know.

In the mean­time, we give you anoth­er take on how to solve our world’s edu­ca­tion­al prob­lems — Father Gui­do Sar­duc­ci’s Five Minute Uni­ver­si­ty:

For oodles of free cours­es, don’t for­get to vis­it our col­lec­tion of 450 Free Cours­es from Top Uni­ver­si­ties.


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  • I met a group of high school stu­dents in a Star­bucks. We got to talk­ing about high­er edu­ca­tion. The one stu­dent told me he was award­ed a $15K aca­d­e­m­ic mer­it schol­ar­ship from one of the local state uni­ver­si­ties, but he still had to bor­row almost $20K to cov­er the tuition. He thought this was dis­gust­ing. That was the word he used: dis­gust­ing, and all of his class­mates were nod­ding their heads in agree­ment. Change may be com­ing much soon­er “than com­pla­cent col­leges think.”

    Thank you for post­ing this.

  • Tasnuva says:

    High­er edu­ca­tion has become asym­met­ri­cal in the amount of mon­ey it costs to attain a degree and the length of time it takes to find a job that pays well enough to pay off those loans. If stu­dents are to be the future con­sumers of the econ­o­my, it does­n’t make sense to place such a high finan­cial bur­den upon them from the start. Your pro­posed mod­el is inter­est­ing to say the least, and I reluc­tant­ly agree that this seems to be the tra­jec­to­ry, and it’s a shame because learn­ing has become so com­mod­i­fied that if a field does­n’t seem to “pay off” it is cut, despite the valu­able life lessons and gen­er­al well-being cer­tain sub­jects (espe­cial­ly with­in the human­i­ties) can bring.
    I have def­i­nite­ly expe­ri­enced the non­cha­lance regard­ing receiv­ing help from high­er insti­tu­tions– as a stu­dent, I don’t feel like I’m val­ued unless I’m pay­ing exu­ber­ant fees, but I put up with it because I tru­ly love to learn. It’s a shame that learn­ing has become a mat­ter of access based on socioe­co­nom­ic income rather than mer­it. Isn’t it bet­ter for the com­mu­ni­ty and for the coun­try if its mem­bers are well-edu­cat­ed and able to con­tribute not just eco­nom­i­cal­ly, but in all oth­er areas?
    Inter­est­ing post.

  • If past expe­ri­ence is worth any­thing, video based teach­ing will fail. It is too inef­fi­cient, too cost­ly and reach­es too small a frac­tion of the pos­si­ble stu­dents.

    Look at the web site attached if you are inter­est­ed in a mod­el that can reach many more stu­dents, regard­less of the speed of their con­nec­tion or an dis­abil­i­ties they may have.

  • In response to Jer­rold, I think a Social Media type plat­form will be the future of edu­ca­tion, and video will be one of the many tools of this revised ped­a­gogy.

  • In response to Charles — only if you choose not to serve the major­i­ty who access the mate­r­i­al on a phone with a slow con­nec­tion.

    Even if you are will­ing to exclude the dis­ad­van­taged, the text equiv­a­lent alone (required by law) for the videos push­es the price out of reach for many insti­tu­tions.

  • Luke Mulks says:

    Excel­lent piece! I read this, and had to com­ment: “Pay­ing for a col­lege edu­ca­tion is get­ting unsus­tain­able”

    I agree with much of what the piece is say­ing, except that I feel it’s not ‘get­ting’ unsus­tain­able, but rather it already is way past that point. The rip­ples haven’t rocked stu­dents as much as they soon will, but the pieces are already far in motion. The oth­er inter­est­ing point to men­tion that unlike cred­it card and home­own­er­ship, stu­dent load debts stick on the record even with bank­rupt­cy. Looks like shack­les for banks.

    What’s promis­ing is to see that peo­ple are band­ing togeth­er to fur­ther edu­ca­tion through oth­er means. http://www.njpoet.com and oth­er sites out there across the coun­try are work­ing to help make that hap­pen, and keep the dia­logue open and ongo­ing for those who care to be edu­cat­ed. It’s one thing to post a lot, it’s anoth­er to do it well. We’ve all got skin in the game on this one.

  • What are the alter­na­tives, Jer­rold?

  • jonfernquest says:

    Very rea­son­able spec­u­la­tion about what is com­ing next.

    This rais­es the ques­tion of what is com­ing next in a world of reduced oppor­tu­ni­ties for uni­ver­si­ty sup­port­ed research that this sce­nario seems to por­tend.

    Per­haps, some space will open up for research by inspired ama­teurs and pro­fes­sion­als out­side the uni­ver­si­ty who pur­sue research as an avo­ca­tion or as an exten­sion of their pro­fes­sion on the side­line of a more main­stream bread-win­ning career. This might arise as an out­growth of greater engage­ment of uni­ver­si­ties with the pub­lic. (Fund­ing of pub­lic inter­est jour­nal­ism at UC Berke­ley’s jour­nal­ism school seemed like a step in this direc­tion).

    Inspired ama­teurs seem to have played impor­tant roles in the past in many areas rang­ing from biol­o­gy (nat­u­ral­ists) to lex­i­cog­ra­phy (OED) to his­to­ry (will have to make a list).

  • Check out Luke Mulks plug­ging my site. Thanks, Luke! =)

  • Jen Machajewski says:

    This quote: “… schools that throw away the four year mod­el (and the human­i­ties too) and offer stu­dents a very tar­get­ed online edu­ca­tion in prac­ti­cal fields — from account­ing to cod­ing to nurs­ing to law and busi­ness — …” makes me sad. Throw away the human­i­ties? Only “prac­ti­cal” fields. Who gets to define prac­ti­cal?

    Think of the low qual­i­ty of the aver­age high school edu­ca­tion; with­out the col­lege expo­sure to human­i­ties, philoso­phies, crit­i­cal think­ing, intense writ­ing require­ments — we will have more and more of the gen­er­al pop­u­lous less knowl­edge­able about any­thing out­side of their lit­tle bub­ble of inter­est, nor the com­mu­ni­ca­tion skills to share their knowl­edge with any­one out­side their spe­cial­ty. And aren’t we just now learn­ing with the inter-con­nect­ed­ness of the world, the web, that the best ideas are when knowl­edge and curios­i­ty and inspi­ra­tion col­lide among a wide vari­ety of dis­ci­plines. Iso­la­tion phys­i­cal­ly or in knowl­edge stag­nates.

    It sounds like we’re pulling DOWN col­lege to the high school ver­sion of VoTech. Sure, VoTech and cer­ti­fi­ca­tion pro­grams and spe­cial­ized schools have their place, but there’s some­thing to be said for the explo­ration part of a four-year col­lege expe­ri­ence. How many stu­dents start out as one major and dis­cov­er in the jour­ney their real pas­sion. If you run straight toward a tar­get­ed online edu­ca­tion, what hap­pens when it’s not enough, when it’s not right (or when that tar­get­ed occu­pa­tion is sat­u­rat­ed)?

    Then again… Maybe the need for explo­ration will change into “gap-year” expe­ri­ences like PeaceCorp or trav­el­ing abroad, intern­ships, etc. Maybe, when some­one out­grows their one occu­pa­tion switch­ing to a new one will be eas­i­er with a two-year online edu­ca­tion rather than return­ing to a 4 year insti­tu­tion to re-start. Cer­tain­ly we see that the idea of one career over a life­time is anti­quat­ed and that “retire­ment” more often means a change in career not the end of the abil­i­ty to work.

  • @jonfernquest “research by inspired ama­teurs and pro­fes­sion­als out­side the uni­ver­si­ty who pur­sue research as an avo­ca­tion or as an exten­sion of their pro­fes­sion on the side­line of a more main­stream bread-win­ning career.” .. Nice. And I think that’s already hap­pen­ing, and the donation/subscription mod­el allows some to turn this research into a bread-win­ning career. Although, most of these suc­cess sto­ries are news com­men­tary based, Richard D. Wolff, an eco­nom­ics pro­fes­sor, is also find­ing suc­cess with this mod­el. Per­haps Pro­fes­sors will embrace the free agent nature of their posi­tions with­in acad­e­mia and go rogue–i.e. become stu­dent fund­ed aca­d­e­mics online. But what about accred­i­ta­tion?

  • Throw away the human­i­ties? Only “prac­ti­cal” fields. Who gets to define prac­ti­cal? ‑Jen Macha­jew­s­ki

  • Claire Brantley says:

    Offer­ing stu­dents “a very tar­get­ed … edu­ca­tion in prac­ti­cal fields — from account­ing to cod­ing to nurs­ing to law and busi­ness — at a dra­mat­i­cal­ly low­er cost” used to be called com­mu­ni­ty col­lege. The idea of putting it all online is all that’s new here.

  • I hear you, Dan. I taught col­lege writ­ing for five years and watched all of my stu­dents slow­ly become finance majors. And as some­one who also stud­ied the human­i­ties on the grad­u­ate lev­el, I have to say, in my hum­ble opin­ion, we haven’t done a very good job defend­ing our­selves against the claims of our irrel­e­van­cy.

  • I lis­tened to a lot of talk radio on Sep­tem­ber 12, 2001. Real­ly, that’s all there was. No one knew how to han­dle it, so they just had lis­ten­ers call­ing in, shar­ing their sto­ries, their thoughts and feel­ings. I was sur­prised how many peo­ple, ordi­nary work­ing class peo­ple, asked if they could please read the poem they wrote about their expe­ri­ences on 9/11. We need the human­i­ties more than ever before.

  • Tyler says:

    I feel like this post dras­ti­cal­ly under­es­ti­mates the social stig­ma that comes along with telling some­one that you’re “tak­ing class­es online.” As much as we’d all like to talk about a rad­i­cal change to the Uni­ver­si­ty mod­el, kids today are told that they have to go to col­lege, oth­er­wise they will wind up flip­ping burg­ers at McDon­ald’s. I gen­uine­ly believe that if it weren’t for the stig­ma attached, tech­ni­cal schools and com­mu­ni­ty col­leges would be sig­nif­i­cant­ly more pop­u­lar.

  • In response to Charles — here is a course of mine which works on all devices and over a slow con­nec­tion.

    Again, the site that give direc­tions about how to do it -

  • Ed Desautels says:

    Regard­ing the “prac­ti­cal fields” notion, this has also con­tributed to the demise of high­er ed. Since WWII, cor­po­rate Amer­i­ca has become increas­ing­ly effec­tive at pri­va­tiz­ing its gains and social­iz­ing its costs. One of these costs it the cost of train­ing its employ­ees. Time was, you went to uni­ver­si­ty to learn how to _think_, not how to per­fect amor­ti­za­tion sched­ules and should-cost analy­sis mod­els. Over the past sev­er­al decades, I think uni­ver­si­ties had to spread too far and wide, cov­er to many areas of advanced “vo-tech,” to remain sus­tain­able. They’re forced to keep up with what­ev­er “prac­ti­cal fields” means in a giv­en era.

  • Anon says:

    Today’s loan *amounts* are much greater than in the past, but oth­er­wise how are today’s lib­er­al arts majors real­ly in worse shape? I grad­u­at­ed when the min­i­mum wage ranged between $3‑ish-to-$5‑ish/hour with about $15,000 in debt. Rel­a­tive­ly few grad­u­ates in the lib­er­al arts go straight from the com­mence­ment cer­e­mo­ny to their dream, career-ori­ent­ed job–and they nev­er have. For many of us there are years of menial work/shared housing/loan pay­ments along the way. If you don’t want to grad­u­ate in debt, work your way through school. You’re still doing McWork, but your degree will be pay-as-you-go, the debt load will be lighter, you have more chances to fig­ure out what you real­ly want to do with your­self, and there’s no hur­ry to enter the pro­fes­sion­al job mar­ket these days, any­way.

  • Matt says:

    That sum­ma­ry of the Plan­et Mon­ey episode was­n’t real­ly fair. The much *big­ger* take­away of that episode was that the aver­age amount peo­ple are *actu­al­ly pay­ing* for col­lege has gone *down*. Yes the *stick­er price* has sky­rock­et­ed and yes col­leges think hav­ing a big­ger stick­er price lends pres­tige, but the increased stick­er price has been met with enor­mous schol­ar­ships that off­set that price for the vast major­i­ty of stu­dents.

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