Decoding Disorder in Universities
Surviving and thriving in turbulent times
It is almost a truism that when things get chaotic, individuals take cover and wait for the storm to blow over. Unfortunately, the storm in higher education is just forming, and it may last longer than most professional educators can wait. Artificial intelligence, rapid obsolescence, automation, data deluge, and virtual reality are all synonyms for chaos in education. Each has the potential to affect the way we teach and the workplace into which we send our graduates. Hopefully, after reading the statistics and predictions about each of these changes, you will have concluded that not only is change inevitable but that it will prove to be very disruptive. Leaders in higher education must become responsive to these changes and develop the capacity to anticipate them and view them as opportunities for growth, rather than threats.
Unfortunately, most educational institutions are populated with individuals, including many of their leaders, who sought a profession that provided stability and safety. It is unlikely that they will change willingly. To encourage and facilitate necessary changes, universities must begin to reward faculty and staff who show initiative and develop innovative responses to these changes. More importantly, universities must place a higher premium on attracting individuals who are entrepreneurial and innovative over those who have weighty and impressive curriculum vitae. That is not easy, but it is a manageable challenge, particularly if the university is flexible about hiring part-time faculty who keep one foot in the industries that the university seeks to populate with its graduates.
I once toured the Virginia Serious Gaming Institute at George Mason University (VSGI) with the director, Scott Martin. I was impressed with the state-of-the-art facilities, the computer resources, and the overall quality of the facility. I noticed, however, that the facility was empty even though it was midday. I asked Scott, Where are the students? He smiled wryly and commented, They are all out at their internships. They only come at night to work on coding for the simulation they are developing for course credit. He then offered an afterthought: Most of the students will already have high-paying jobs with local software, virtual reality, and gaming companies by the time they reach graduation. My thoughts were that they are getting advanced programming skills from the adjuncts at partnership technology companies, working on real-life projects under their supervision, and once they have demonstrated their work ethic and programming skills, they begin a job at that company with a high-paying salary. This is a perfect partnership where the university benefits from the expertise of technology companies and the companies, in turn, have a pipeline of talent to staff a growing technology field, and with talent that they selected and trained.
Creating corporate/education teams tasked with the responsibility for creating new initiatives can, over time, help the university as a whole to adapt to a startling new reality: academics no longer have sole responsibility for educating the next generation of workers and leaders. In the absence of effective collaborative educational efforts, they are in danger of becoming marginalized by the very companies that they hope will employ their graduates.
Adapting to new marketplaces - It is often considered crass to think of educators as preparing individuals for the marketplace. This is not an opinion shared by the public, who often make major sacrifices to send their children or themselves to an institution of higher learning with the expectation that it will improve their lives. However, we cannot divorce career advancement from education as if self-improvement is the only noble goal of education.
Employers need individuals who possess applicable knowledge, skills, and abilities to contribute to the generation of goods and services that benefit everyone. That expectation by the college, if unrealized, will be fulfilled by other agencies that do teach these marketable skills. It may be online, for-profit institutions, innovative educational institutions, corporate universities, or through creative educational partnerships. Educational institutions are tasked with creating innovative solutions to rapid automation, artificial intelligence, robotics, and the data deluge that is beginning to displace large segments of our workforce. Workers at every level and some who thought that their careers were safe from these disruptive technologies are beginning to worry and seek ways to ensure that the knowledge and skills that they possess are relevant and in demand. One way or another, they will find solutions. The question is, will traditional higher education be considered a viable partner in this endeavor, or will it be considered irrelevant?
Joseph Aoun, in his book Robot-Proof: Higher Education in the Age of Artificial Intelligence, made the following observation about coping with the challenges of modern technology.
The workers who command the most value in the market today are those with advanced degrees, particularly ones that equip them to work alongside intelligent machines in highly technical areas such as bioinformatics and cybersecurity.
Educating humans to retrieve information is a failed enterprise. Machines are getting better at what they do – retrieve and present information more quickly in a variety of formats and with more precision than humans. Humans need to be educated to use information provided by machines utilizing artificial intelligence to produce creative and unique solutions. Machines follow rules to provide answers. Humans break the rules to find creative solutions. Higher education must become a lifelong effort to create a generation of creative thinkers.
Aoun concludes, Whatever the field or profession, the most important work that human beings perform will be their creative work. That is why our education should teach us how to do it well.
The marketplace has been responding to this perception, and post-baccalaureate enrollment in the United States soared by 36 percent from 2000 to 2010. Beginning in 2010, however, first-time undergraduate enrollments began to decline, decreasing 18 percent between 2010 and 2020 (3.2 million vs. 2.6 million). This is a troubling trend for educators and for society in general. If it continues, we will see gradual and then rapid displacement of individuals who lack the knowledge and skills to manage increasingly complex technological solutions.
Where do we go from here?
If you are a leader in higher education or consider taking on the role, the turbulence that is affecting many institutions is particularly evident. Leaders must have a vision for where they are leading their organization, and they must understand the trends that will impact their journey. The following observations are by no means all-inclusive, but they do reveal the complexity of the environment. Over the next few blog posts, I will examine in greater detail the impact of changes that are affecting institutions of higher education and outline potential responses by leaders in those institutions.
Declining Enrollment & Demographic Shifts
First, we will examine the demographics of the population of individuals who may enroll in institutions of higher learning with a focus on the trends that are changing the number and composition of the applicant pool.
Colleges are competing for a shrinking pool of 18 to 24-year-olds. The Great Recession of 2007–09 had an impact far beyond economics. Birth rates began to decline and have not recovered to pre-2007 levels since. Nationally, that age cohort declined by 2.1% between 2015 and 2020 and is projected to decline even more after 2025 as we hit what is known as the enrollment cliff. That may be a bit of hyperbole, but it is supported by data from reliable sources that predict a significant decline in applications that will not be spread evenly over all types of educational institutions. Most analyses indicate that 2025 is the year the number of high school graduates is projected to peak, and the decline will then become more pronounced. Estimates vary slightly, but forecasts generally predict a 13% to 15% decline in the number of high school graduates by 2041, according to the Western Interstate Commission for Higher Education (WICHE). Some projections show a 15% drop in the college-going population between 2025 and 2029 alone. Patrick Lane of WICHE suggests it might be a more gradual decline over 15 years, rather than an immediate plummet. However, even a gradual, sustained decline will still pose significant challenges for many institutions of higher education.
Birth rate declines in the U.S. (especially post-2008) are leading to a sharp drop in the number of college-age students.
Regional disparities: Rural and Midwest schools are hit hardest.
Institutions must compete fiercely for a shrinking pool of applicants, often resorting to aggressive tuition discounts.
The projected enrollment decline is causing much hair pulling and gnashing of teeth as colleges fight to maintain their enrollments and, hence, their budgets. Private colleges are harder hit because they don't have access to the public purse and are almost entirely dependent on tuition for their revenue. Higher education leaders need to understand how these trends will interact in their unique context and what they must do to adapt.
The decline in enrolled students is of particular concern in small institutions that are generally tuition-driven and for whom lower enrollment translates into cost-cutting measures and concerns. Nearly all of the 72 colleges that have closed their doors in the past decade had enrollments of less than 1,000 students. These institutions are typically heavily dependent upon student tuition, and when their enrollment begins to decline, they increase their discount rate in a vain attempt to boost enrollment. The increased discount heavily affects the bottom line. It results in a cycle of negative internal adjustments (e.g., uncompetitive salary structure, reductions in force, elimination of programs), eventually resulting in lower-quality course offerings.
The decline in college-bound high school students has made the competition more intense and heightened the concern of educational administrators that they may one day be at risk of closing or forced into a merger with other, sometimes larger, institutions. Now is the time for university leaders to develop long-term strategies that address declining enrollments.
Declining Confidence in Higher Education
According to a recent Gallup Survey, Americans’ confidence in higher education has fallen to 36%, sharply lower than in two prior readings in 2015 (57%) and 2018 (48%). The researchers observed that confidence in higher education had reached a new low, while still high compared to other institutions that have experienced similar declines, it indicates a growing perception that the benefits of earning a degree are not worth the cost. The Gallup researchers observed that for the roughly one-third of Americans with very little or no confidence in higher education, perceptions that colleges are pushing certain political agendas or not teaching the right kinds of skills are at the forefront of their concerns.
Many students and their parents are seeking meaningful alternatives, including trade schools, online degree-granting programs, micro-credentials, and technology training provided by major technology companies.
Rising cost of higher education
Attending a college or university is expensive, and it has become even more so in the past ten years. Since the early 1970s, tuition has risen faster than the cost of living, but the increases have been even more significant in the past ten years, touching even the well-endowed Ivy League institutions. There is no clear consensus about why the cost of higher education increases faster than the cost-of-living, but the Great Recession and the Pandemic adversely impacted the wages of parents, which in turn reduced the taxes states were able to collect. While per capita income in the U.S. has been flat since 2000, three segments of household expenses have risen much faster than inflation – housing, education, and health care.
Data from the University of Pennsylvania confirms that, after adjusting for inflation, the average tuition and fees rates have increased 181.3% since 1989-90. Some institutions have attempted to keep tuition and fee increases comparable to the cost of living, but it is a struggle given the competition for students in areas more related to lifestyle than academics.
There are many factors affecting the increased costs, but three (3) that are receiving closer scrutiny are
Rising expenses (salaries, maintenance, technology) vs. flat or declining support from public funding and taxpayers.
Administrative bloat, where senior administrators at institutions of higher learning beef up their staff instead of investing in the quality of education. The administrators point to increased requirements for regulatory compliance. The truth is not universal, but it is evident from a closer examination of faculty composition that senior staff positions have proliferated, and the number of full-time, tenure-track faculty has declined.
Endowments at institutions of higher learning are facing increased scrutiny, and legislators at the state and federal levels are proposing caps on endowment, reductions in tax benefits, and investigations into inappropriate financial transactions.
Return on Investment (ROI)
Financial considerations are a key reason why many don’t attend or complete college. Among adults who do not have a bachelor’s degree and are not currently enrolled in school, roughly eighty percent say it would be difficult to pay for college. One-third of students who left college after enrolling did so because of financial considerations. The result, in many cases, is that students may enroll in a four-year college, only to disenroll before graduation. The term Some College, No Credential (SCNC) has replaced dropout because of the prevalence of incomplete higher education experience. It is a significant and persistent problem for students and their families. Between January 2022 and July 2023, approximately 2.1 million students left colleges without a credential.
Students and parents are increasingly skeptical of the cost and long-term benefits of college, and the perception is that college is for those with ample family resources. A recent survey by The Strada Educational Foundation cited a lack of transparency on the part of higher education as a major factor in discouraging high school graduates from entering a college or university. They stated that a lack of transparency about the cost of postsecondary education makes it difficult for current and potential students to understand and evaluate the cost of a postsecondary education.
Alternatives such as bootcamps, micro credentials, apprenticeships, and online learning platforms challenge traditional degrees.
A recently passed bill to authorize Pell grants to short-term credentialing and certification programs may change the equation by allowing community colleges and for-profit companies to receive federal and state funding for their students.
Discounting to Attract Students
A major factor in creating false perceptions of the cost of a college education is the increased use of tuition discounts to attract and enroll students. Many institutions offer significant tuition discounts from the stated cost of tuition and fees in order to compete with rival schools.
Tuition discounts can make college seem more affordable than it is. Prospective students and their families might believe they are getting a good deal, but the discounted price may still be higher than they can comfortably afford, resulting in financial strain on the family, which may lead many students to withdraw, not for academic but for financial reasons.
Impact on Institutional Revenue: Heavy reliance on tuition discounts can negatively impact the revenue of institutions, especially private colleges that depend heavily on tuition for their income. This can result in a cycle of negative adjustments, such as uncompetitive salaries and reduced program offerings.
The average institutional tuition discount rate was 56.2 percent for first-time, full-time freshmen for the 2022-23 academic year. Private colleges are offering deeper tuition discounts than ever before, hoping to lure more students and boost overall revenue, a strategy that doesn’t appear to be working. The path they’re on may not be sustainable for very much longer, said Ken Redd, Director of Research and Policy Analysis at NACUBO. Calling the increasing discount rate a troubling trend, he added that he isn’t sure how schools can rein in the popular strategy.
Overall, while tuition discounts can make college seem more accessible, they can also create a false perception of affordability and value, leading to long-term sustainability issues for institutions.
Digital Transformation & Online Learning
Online education was slowly being adopted by colleges and universities before the pandemic, and some educational systems (e.g., Western Governors University, University of Maryland Global Campus, Purdue Global, Liberty University, and University of Southern New Hampshire) had been developing large, online student communities. These grew significantly during and after the pandemic as students began to recognize and value the relative freedom provided by online and hybrid educational offerings. According to the National Center for Educational Statistics, the percentage of undergraduate students enrolled in at least one distance education course increased from 36 percent in 2019 to 61 percent in 2021. In a related survey conducted by the National Postsecondary Student Aid Study in the spring of 2020, 84 percent of undergraduate students reported having some or all of their courses moved online. The pandemic forced colleges and universities to adopt new instructional strategies, and while the percentage of undergraduates taking at least one course online has declined to 54 percent, it is still higher than pre-pandemic. There is no doubt that it changed student perspectives on the value of virtual classrooms, and, with the advent of generative AI as a possible adjunct or substitute for face-to-face instruction, we may be at the threshold of virtual education.
Artificial Intelligence & Academic Integrity
We are definitely in the hype curve of GenAI adoption. Gartner, the chief proponent of the hype cycle concept, recently gave the following assessment.
GenAI still has the potential to be a transformational technology with profound business impacts on content discovery, creation, authenticity and regulation, automation of human work, and customer and employee experiences. Still, GenAI faces challenges, including ethical and societal concerns, limited security best practices, and nefarious uses like deep fakes and disinformation. This not only summarizes the challenge of adoption of AI by business but also by higher education. My academic colleagues are constantly discussing the ethical and societal impact of GenAI and advancing strategies for combating cheating and ensuring that the students they teach are learning how to think creatively and not simply filling the void with information gleaned from an Open AI ChatGPT4 app.
A recent survey by Best Colleges reports that college administrators are beginning to take the combination of AI and online education seriously. Most administrators (73%) see artificial intelligence as a beneficial innovation in online education, and 58% of currently enrolled online students say they are already using it to complete class assignments and exams.
An academic attending Harvard’s Management Development Program authored a blog post recently that was titled The Silent Gap: generative AI leadership in higher education in which he lamented that there had been a lot of stimulating conversation about topics relevant to higher education (e.g., leadership, finance, enrollment, diversity, strategy) but almost none of it dealt with generative AI. His observation was that in a room of 75 brilliant leaders, the relative silence around generative AI during the week of the conference was deafening.
Institutions of higher learning need to accept the reality that we are in the middle of a technological transformation, and while we may have just completed the first stage of the Gartner Hype Cycle, there are more stages to come. One other statement by Gartner bears consideration. Gartner defines artificial general intelligence (AGI) as the (currently hypothetical) capability of a machine that can match or surpass the capabilities of humans across all cognitive tasks. They admit that it is hypothetical at this point, but that it has the potential to surpass the capabilities of humans across all cognitive tasks, including education.
Navigating Turbulence in Higher Education
Decision paralysis, also known as analysis paralysis, is a situation where leaders or decision-makers become overwhelmed by the complexity of choices and the fear of making the wrong decision, leading to inaction. In the context of higher education leadership, this can be particularly challenging due to the multifaceted nature of educational institutions, the diverse needs of stakeholders, and the high stakes involved in decisions that impact students, faculty, and the institution's future.
Higher education leaders often face decision paralysis when dealing with issues such as curriculum changes, budget allocations, faculty hiring, strategic planning, and now rapid advances in technology. The pressure to make the right decision can lead to excessive deliberation, postponement of decisions, and missed opportunities. This can hinder the institution's progress and adaptability in a rapidly changing educational landscape.
Effective leaders must analyze opportunities and not be deterred by uncertainty. There will be a lot of confusion bordering on chaos in the years ahead. True leaders recognize the challenges but accept them as part of their lives. They must decode the future and develop creative solutions that protect the institution they serve and seek to move higher education forward to new realities of academic life.
The Future of Higher Education
I will delve deeper into these and other issues affecting higher education in future Substack blog posts. The goal is to present current and future leaders of institutions of higher education with areas for change and growth that they may consider for their institution. The concepts that I present will not fit all cases, but some will, and the attempt is to encourage leaders to become champions for change in the midst of the chaos that is impacting society and our students.