Source: College Board - Trends Report 2011
OK, so the cost of college is in the news all the time now. And this presents a bit of a PR problem for institutions. Just the concept of going to college, much less the value of getting a liberal arts education, has come under fire. A growing number of people, right or wrong, are starting to believe that the job market is so bad that a college investment no longer pays off. The reality is that a college investment DOES pay off in terms of career advancement and take home pay, year over year. But who ever thought we'd be in this position in 2012? Defending the value of a college education at such a basic level? We knew sticker shock would be an on-going problem, but did not expect the value question to be so profound and have legs.
There are a number of reports available that analyze the trends and the hard numbers. We have found this report, College Board Trends Report to be excellent. Comprehensive, clear, well structured and graphically enhanced -- for data geeks like us, this was a terrific read. There are a number of macro trends we all see:
- Published in-state tuition for public four-year universities has been rising significantly above the general rate of inflation for three decades. This trend has increased in past years due to greater goverment budget cuts and subsidy reductions. Net in-state tuition for public four-year universities has risen, but considerably less than published tuition rates (see chart above).
- Published tuition for private nonprofit institutions have risen signfincantly above inflation for three decades as well, though the increases have slowed during the past decade. Interestingly, The College Board points out that net tuition after adjusting for inflation at private nonprofit institutions is lower today than five years ago (see chart above).
- Average incomes of families have declined during that past few years with greater declines at the lower end of the income spectrum.
Worthy of note here, The College Board report highlights the incredible divergence in graduation rates between selective colleges with the best prepared and supported students and open enrollment institutions where graduation rates are half to one-third lower. The figures are striking according to the trend report:
- The most selective institutions found an average of 80% of students graduated within six years
- Institutions accepting at least 75% of their applicants found an average of 53% of students graduated within six years
- Institutions with open enrollment found an average of only 27% of students graduated within six years
The debate focused on college costs misses this critical factor: The likelihood of graduating may well be more important than the cost differenential between schools. What matters most often gets lost when we discuss these macro statistics and averages. What will my return on investment be when I attend and pay for college? These life decisions are being made by each individual, each family, on a case by case basis. And enrollment marketing efforts need to tailor the message based on each institution's best selling points. Today, graduation rates and the percentage of graduates employed upon graduation are winning messages if your numbers are good.
And all of these trends point to why Intead is focused on the international student market. More and more institutions are seeking international students who typically pay more than domestic students for the same degree. While international students require investment in additional support services on campus, the net return helps offset an institution's declining revenue and higher costs elsewhere.
As we stay abreast of these complex data sets, we will continue to share our insights to help you build effective enrollment marketing plans. While we specialize in the international market, the work we do informs domestic recruitment as well.
