With student loan debt in the trillions, college graduates unprepared for entry-level positions, and many people dropping out before earning a college degree, it’s clear that something has to be done to address higher education’s problems. That’s not to say change isn’t already happening. Approaches to tackling the outsized student debt and better preparing American students for the rigors of the real world are underway. But the coronavirus pandemic accelerated change for higher ed at breakneck speed. Expect a decade’s worth of change over the next few years.
The arrival of COVID-19 was transformative for higher education. But the trends driving the disruption are not new. In fact, higher education has been going through a disruptive phase for the past decade. The disruption has been slow—until now. This is what that change means for you and your kids:
Both college students and their parents will pay far more attention to the value they receive from their college experience as well as what it costs them. This will only accelerate as more families either can't or won't pay the levels of tuition that the higher education system requires. It’s the intersection of value and price that will increasingly matter. Often the narrative focuses on price. But when you talk to high school graduates and their parents now, you hear something different. They want assurances that the investment of time and finances in a liberal arts education is worth it—defined by outcomes. Colleges and universities will evermore be reflective of the quality a particular institution offers and what families will pay for that perceived value.
Students won’t be confined by what traditional colleges historically offered or how they offered it. They want a college education when they want it and delivered how they want it. Kids are much more open to online learning, face-to-face hybrid formats, blended learning, accelerated programs, online classes, and more. Pressure will grow to bend the model and to offer things like micro-credentials focused on narrow career goals and academic programs that are tailored to specific interests. Students will be vocal about the terms under which they are willing to invest the time and financial resources.
Parents typically reduce this to “getting a job,” but this misses the larger point. Both parents—who often pay for higher education—and students—who invest time and earnings, and take on the debt—go to college because they want to do well in life. They want a good job as part of their ambition to be happy, secure, and the architect of their lives. Going forward, parents and students will demand to know how successful the university is at launching graduates into lives and careers. They also will want to know more about the risk factor—what percent of students fall through the cracks and how educators help those students and alumni.
Location matters more than ever. And while there is no clear pattern yet, you can expect that location will move up on the list of things students use to decide college choice. Some students will choose to enroll closer to home given the uncertainty of the pandemic. More students are likely to matriculate at colleges and universities in more dynamic urban areas. International students will select areas of the country that are open and friendly to people like themselves. More students attending college are attentive to their own needs—whether they’re health-related, or focused on entertainment or access to transportation—and they choose where to study and live with those learning experiences in mind.
As people come to distrust institutions, they search for brands that add meaning and value to their life. That makes the brand of any particular institution much more important. Brand develops as students and families tell stories about their experience with a particular university or college. Students will seek out brands that speak to the journey they hope to take.
What does the future of higher education look like in 18 years? It may look more like other sectors—a few big universities with world-renowned reputations (Arizona State University has almost 120,000 students and the University of Southern New Hampshire has more than 138,000 students) that continue to grow, a national group of truly exceptional mid-size and small private colleges and universities that serve students who want to push themselves at the absolute highest level, and more inexpensive community colleges that serve local students.
A four-year degree is estimated to be priced at $442,697.85 for students enrolling in 2039—assuming tuition cost increases an average of 7% per year. Talk about sticker shock! But ScholarShare 529 has strategies that can help you keep pace with tuition hikes. By starting a disciplined savings plan now, you may be better positioned to meet your child’s future education needs.