Are We at Peak Higher Ed?

Are we at peak higher ed? My answer is no, but that answer depends on the definitions that we choose.

Does peak higher ed refer to the number of schools, or the number of students enrolled? The number of people employed in higher ed (or just faculty), or the number of credentials granted? Tenure-track faculty jobs or the impact on the lives of graduates? The total number of colleges and universities, or the total value of the knowledge created?

Bryan Alexander’s recent piece "American Higher Education Enrollment Declined. Again" would tend to support the peak-higher-ed hypothesis.

In that piece, Alexander breaks down some recent data from the National Student Clearinghouse Research Center. These data show a 1.3 percent drop in enrollment between this year and last.

I don’t make too much of year-to-year changes in enrollment. As Alexander notes, annual enrollments are driven by any number of cyclical and exogenous factors. These factors range from the economy (low unemployment depresses enrollment), to changes in regulations and the competitive landscape. Here the story is the collapse of the for-profits, and the rise of nonprofit online options.

What Alexander is asking is a deeper and more interesting question. Are we in for a long-term decline in the postsecondary sector? Are we at peak higher ed?

Alexander writes, “Back in 2013 I introduced the idea of peak higher education in the United States. It was a thought experiment, and it seems to have been borne out steadily. I really didn’t want it to come true. I hate to say ‘I told you so,’ but, well, it looks like I did.”

Again, I’d say the answer to Alexander’s question depends on your framing. Here is why I’m putting forward an anti-peak-higher-ed hypothesis:

Argument No. 1: Enrollments vs. Institutions

We are probably in for a future where the number of institutions decline, while the total number of students goes up. This is a function of where population growth is centered (the South and West), where it is flat or declining (Northeast and Midwest), and how colleges are distributed. The Northeast and Midwest have lots of small institutions; the South and the West has fewer but larger schools.

I tend to think that small colleges, even small colleges in demographically challenging areas, are more resilient than we give them credit for. So I don’t expect a wholesale collapse, but definitely a steady diminishment in overall number of colleges.

Argument No. 2: Master's Degrees

Every report that I read about the future of higher education highlights the growing demand for master’s degrees. The master's is the new bachelor's. Jobs that once required an undergraduate degree now require an advanced degree. A recent federal report projected that the number of graduate students would grow by 21 percent between 2014 and 2025, to 3.5 million.

We can debate if this is a good thing or a bad thing for society, the economy and individual workers. It is entirely possible to have a trend that benefits colleges and universities (increased demand for master's degrees) but does not benefit society at large. I’m more pro-advanced degree than others. I tend to think that more education is almost always better than less education. I do understand the concern about degree inflation. Still, there remain opportunities for institutions to grow the market for credentials beyond the bachelor’s (through new specialized degrees) and for the overall demand for these graduate degrees to increase.

Argument No. 3: Online Education

The question of peak higher ed really comes down to a question of the value of a postsecondary credential. If you think that the education, training and credentials one gets from a college or a university will grow in value in tomorrow’s economy, then you may conclude that the demand for higher education will grow as well.

Today, less than half of Americans have an associate degree or more. Approximately 31 million Americans who started but never finished college would be a reasonable potential market to enroll.

This is where online learning comes in.

There are about six million students enrolled in at least one online course. The acceptance of online learning, by both potential students and employers, has grown with the quality of these programs. The ability to move toward an undergraduate or graduate degree, while also balancing work and family demands, has made online learning attractive to an ever growing number of adults.

Online learning removes at least two of the barriers -- time and space -- that push down the demand for higher education. It will be interesting if current experiments to drive down the costs of online higher education -- to bring online education to scale -- will be successful. (See “Online, Cheap -- and Elite,” an Inside Higher Ed analysis of Georgia Tech’s online master's in computer science, which asks if other colleges will follow in trying to create high-quality, low-cost online programs at scale.)

My read is that online education -- in all its forms -- will grow dramatically over the next few decades. My bet is that the combination of high-quality low-residency education and lower-cost online-only programs will power a 21st-century renaissance in postsecondary education.

Argument No. 4: What We Mean By Enrollment Is Changing

How we think about higher education is changing. We have already moved past the idea that college equals a four-year residential experience for 18- to 22-year-old recent high school graduates. We have probably reached peak traditional higher ed.

Enrollment numbers, however, only capture students who matriculate in credit-bearing courses leading to accredited degrees. We need to think about counting those learners who are participating in nondegree programs. We need to take seriously the impact of the rise of alternative credentials.

We also need to avoid the mistake of thinking about higher education in the narrow terms of today’s models. The full-time residential model of higher ed may have peaked, but the universe of postsecondary educational opportunities will continue to expand.

This is a challenging future for many institutions (and those of us who make our living at colleges and universities), but ultimately a very good future for tomorrow’s students.

The work to be done in the future will largely be about advocating for public investment in higher education. What scares me the most is that we’ve reached peak public investment in higher ed.

If that is true, the future of higher education will be one of great inequality. One where postsecondary learning opportunities are expanding for the privileged few, while the majority of learners (and potential learners) are left on the outside looking in.

This is a good discussion to have, and I’m grateful (as always) to Bryan Alexander for initiating the conversation.

Do you think we are at peak higher ed?