New Ways to Demonstrate Student ROI

ABOUT THIS EPISODE

Nick Ducoff, author and CEO at Edmit, joined the podcast to talk about public distrust in higher ed’s value and all the new ways higher ed is working to demonstrate student ROI.

Seventy two percent of private nonprofit for your institutions are both high price and high quality, and only twelve percent or high price and low quality. The problem is that while vast majority of colleges are high price and high quality, student perception is different. You're listening to enrollment growth university from Helix Education, the best professional development podcast for higher education leaders looking to grow enrollment at their college or university. Whether you're looking for fresh enrollment growth techniques and strategies or tools and resources, you've come to the right place. Let's get into the show. Welcome back to enrollment growth university, a proud member of the connect ETU podcast network. I'm Eric Olsen with Helix Education and we're here today with Nick Dukoff, author of better off after college, a guide to paying for college with more aid and less dead and CEO at admit. Nick, welcome to...

...the show. Thank you so much for having me. Really excited to talk with you today about new ways higher at is working to demonstrate students are OI. Before we dig in, can you give the listeners a little bit of background on admit? Sure admit helps high school students and their families, makes Smarter College and career decisions. Perfect Elevator pitch and great background for what we're going to dig into today, because just get us cut up kind of a speed with where we are right now. Can you remind us where the public is right now in regards to their trust in colleges return on investment? Consumer sentiment has become so negative that over half of college students agree with the statement that, quote, my institution only cares about the money it can get from me and quote. That's according to a recent survey by Third Way of think tank, and is really incredible to think about. Eighty percent of students say they're concerned about getting any type of job when they graduate, according to a different study from Third Way. And when you think about that, why would...

...students pay a high price for college if they don't think they'll get a job at all after graduating? And according to another study from ECMC, just one fourth of students believe a four year degree is the only route to a good job. One of my founder peers, Austin all read, the founder of voting boot camp, lamb to school, has summed it up, I think, rather nicely. He says there are a lot of schools that shouldn't exist and their whole bunch of schools that should. The problem is the average seventeen year old has no idea which is which and there's nothing out there to help them. Until you start to align and sins financially in some way, will continue to have crazy surplus and crazy shortages, and I think that's really a student. So we're aware there is this massive public facing problem here. Let's talk about some of those potential solutions, both internally that institutions are working on, as well as federally. Can you clarify the primary goals behind a gainful employment rule and what institutions might be most impacted either way by the Biden Administration?...

We reinstating this? Sure so? The Department of Education under President Obama established the gainful employment regulation to ensure that programs specifically at for profit schools didn't result in excessive debt relative to a graduates income. And that Third Way Study I recently cited looked at price to quality ratios of colleges and found that seventy two percent of private, nonprofit for your institutions are both high price and high quality and only twelve percent or high price and low quality. The problem is that, while a vast majority of colleges are high price and high quality, student perception is different. Compare that, though, that roughly four out of five for profit. For your colleges, almost eighty percent are high price and low quality, compared to just twelve percent of nonprofits. And so the gainful employment regulation was really specifically focused on that cohort of colleges that really hasn't driven...

...positive outcomes for students that have attended. And what's the hope behind not just providing transparency there, but help us understand the logistics and mechanics of what a gainful employment rule might do? Yeah, well, so it's a stick. Schools that don't meet the Game Ful Employment Rule Aren't eligible for title for federal funding. So you know, they obviously want to be able to receive federal their student for their students, federal financial aid and student loans, and so you know, it's really a way to keep schools honest and working towards providing positive outcomes for graduates. Let's talk about a non stick incentive, this idea that the democratization of education solves all things. Many of us in Higher Ed believe that to some degree. Let's talk about the college score card. Has the increased transparency of college outcomes seemed to impact student choice yet? So I would say the biggest success of the college score card has been what it's done...

...to enable the private sector to build on the data and provide more tools and actionable guidance for students. You know, the College score card website itself, maintained by the Department of Education, I think, has received, you know, somewhat underwhelming traffic. But then again, you know, how many federal websites do you frequently visit on the Internet? Right? So, you know, I wouldn't necessarily hold that against them. I think they've done tremendous work at compiling an unbelievably rich and valuable data set that, you know, has led to academic research, you know, literature in the field and saw for products like Edmont. So we have the Fed thinking about the levers that are within their control to influence student behavior, citizen behavior. Let's talk about inside of our campuses from a messaging standfill point, from a persuasion standpoint, as colleges work to find new ways to tell their value story in a way that...

...sticks. help us understand some of these value acronyms that many of us are starting to see and how they're calculated. Yeah, so there's so many different ways to calculate Roi and I recently spoke to the Marketing Department of a large financial institution. There was maybe, you know, fifty marketers in the audience and I asked them if they knew what the acronym ro I stood for us. To just raise your hand and I'd say, you know, about half raise their hands. So you're talking about folks responsible for messaging to the consumer at a financial institution and only half of them know what are alive is. And you know, there's no judge. I'm not passing any judgment on that. It's just the fact is there's a lot of jargon, you know, when you're talking about measuring financial returns, and it's complicated. But there are a number of approaches out there know that I think are really helpful and, you know, moving towards hopefully, a roi calculation that can become universal.

I think we're still bit of ways off from that, but the center on Education and workforce at Georgetown University and pay scale both have our awe approaches that allow future returns to be compared to an upfront investment. Today and the Brookings Institute takes a different approach, as you mentioned. It analyzes the college's value added, which is a difference between actual earnings outcomes and the outcomes one would expect given a student's characteristics and comparable colleges. The fourth approach I've looked at his third ways pep, or price, the earnings premium, and that's used to determine the number of years it takes to pay off the cost of earning the degree. You say something interesting there, and so I'll maybe give you a double barreled question. One, do you find any of these metrics more compelling if we're looking for that universal metric? Or, to your point, is it only helpful if it becomes a universal metric and one that all of...

...the colleges that a students considering are utilizing so I can compare and contrast with them? You know, I think there's there's pros and cons to each of these different approaches. For example, Georgetown's approach. You know, they humbly call their effort to first try and their calculations are quite sophisticated and well considered. But because of the sophistication. A seventeen year old might have difficulty understanding it. And they actually produce the data with multiple time periods for that net present value calculation. And students are already suffering from choice overload, so having to evaluate and choose between multiple in PV time periods, you can imagine how that could become overwhelming. Nick, do you believe college is worth it? Yes, there's so many different ways to demonstrate that. You know, the most, I think, prevalent that people cite is that college graduates tend to earn on average about a million dollars more in lifetime earnings than their non college...

...graduate peers. And, as the Third Way Research Indicates, most nonprofit higher education institutions are high quality. The problem is that they're also high price. The New York Times reporter run LEABER, who I consider a friend, artfully details how things got this way. Is New book the Price You pay for college? He also notes that the return on investment of college in the form of higher wages, it's fourteen percent annually, or twice the typical stock market return. So if you told me, hey, you can do this thing and you're going to get double the return of the stock market. You know that's hard to be. That said, you know, we all know that too many students unfortunately start with the best of intentions and for any variety of reasons, don't graduate and have, you know, some debt and no degree. And it's it's those students in particular that that my heart really goes out for, because they don't get the V A fit of the earnings premium, but they still have the saddling of student dead. So this is this is...

...a great summation of kind of, I think, where we are in this argument that Nick just gave us a wonderful quantitative, factual understanding in the value of college, and yet many don't feel that it's true. Nick. How do we translate those Quantitative Facts About College Roy into public belief and trust in its value? Yeah, so I think to come up with really simple and easy to understand measures that seventeen year olds and their parents can readily understand. And so, for example, we use stop like colors, you know, red, bad, green good, and we and we reinforce those rankings with a grade system. You know, see bad a good. So when you put those together, red, sea, bad, green a good, you know, it's probably overly simplistic, but users get it and, you know, I think as long as folks are making directionally correct choices, they'll be better off. And that's ultimately, you know, the intention behind what we...

...do. It admit, and I think what most of these, if not all of these folks that are putting together these are calculations, are trying to achieve as well. It's complicated, though, right. So, for example, some of these are calculations don't take relative income into account, only cost. So a concern about those approaches is that they could lead to undermatching because it makes inexpensive programs that can be paid off relatively quickly look really, really good. However, it hides the fact that they may have considerably lower career earnings potential than other colleges that may be slightly more expensive. So I don't know that there's a silver bullet. I think if there was one, you know, one of these smart folks, whether it Georgetown, Brookings, Third Way, you know, etc. Would have found it, you know, but I think that the great news is we're all starting to collaborate a little bit. You're starting to see, you know, more literature out there around this topic and conversation, thinks the people like you who've invited me to join you today, and so I think that's promising and you know, ultimately will...

...find something that is compelling and could you work towards becoming a universal standard. Super Helpful, super hopeful. Nick, can you leave us with any next steps? Advice institutions who are hearing this, who are saying yes, I believe it, I agree. We want to tell the story better on our website when people look at our tuition page. How do we help them understand the real, real financial story here and in a way that really really highlights the value that we're providing? Where should they start first? Well, I'll just note two colleges that I often say. One is Gross City College in Pennsylvania and I appreciate that they cite scripture proverbs one a while sharing their commitment to dealing truthfully in their pricing, avoiding what they call the problematic practice of unfunded tuition discounting, and they further claim to set their tuition it would it actually cost educate a student? You know I have an independently validated that, but I think that's a pre bold statement to say we are charging you our...

...cost and then you have someone like the Paul University in Indiana. They make a different promise to students. Their gold commitment assures alumni that there to paw and that's to Paul with a w degree maintains its value, and that's a bold commitment as well. They're saying, Hey, if you graduate from here, we're going to make sure that that this was worth it, and that's the question that we hear. That's how how students and parents that we talk to frame it. They say, is this going to be worth it? And that's really the framing that I think colleges should consider because, as the third way research shows, seventy two percent of nonprofits are high quality. They also happen to be high cost, and so you need to be able to really distinguish the value that is it worth it question, because most colleges just really can't produce pricing and those that have tried with tuition resets have found challenges because it becomes a slippery slope. So the best way to approach it,...

I think, is by really demonstrating the value the investment and how it pays off for students, even if it costs quote a lot, and you know Fiftyzero, hundred thousand, hundred, fifty thousand, turn thousand. That's all a lot right, no matter how you cut it. Nick, thanks so much for your time today. What's the best place for listeners to connect with you or your team if they have any follow up questions? So you can find me on twitter at Nick Dukoff. That's in IC K DOUCO FF, and you can check out admit at eedmt admit dot me. Awesome. Thanks so much for joining us today, Nick. Thanks for having me or talk to you soon. Attracting today's new post traditional learners means adopting new enrollment strategies. Helix educations data driven, enterprise wide approach to enrollment growth is uniquely helping colleges and universities thrive in this new education landscape, and Helix has just published the second edition of their enrollment growth playbook with fifty percent brand new content on...

...how institutions can solve today's most pressing enrollment growth challenges. Download it today for free at Helix Educationcom. Playbook. You've been listening to enrollment growth university from Helix Education. To ensure that you never miss an episode, subscribe to the show in Itunes. Or your favorite podcast player. Thank you so much for listening. Until next time,.

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