How Schools Can Help Students Maximize Their Return On Investment
Students need to be provided with the most information possible when it comes time to pick a college. This will let them maximize their ROI potential, but schools need to play their part. By offering clear career paths, providing relevant campus activities, and investing in stackable programs, the students will be better prepared for the. World after graduating.
The EvoLLLution (Evo): What was the most startling finding that came out of your recent research into the ROI of education?
Martin Van der Werf (MVDW): We found that for-profit colleges, in general, give the lowest return to low-income students, but there are several exceptions. Some for-profit colleges are very good investments for low-income students. The students graduate and make a good living. The downside is that generally these colleges are very small and tend to be in very niche areas—for example, training commercial divers or airline mechanics. Those are very important jobs, but there aren’t that many openings. And for someone interested in one of those fields, who wants the credential to get into the industry, a for-profit institution can be a really good place to go. Overall, however, most for-profit colleges offer poor outcomes to low-income students, which is very worrisome because they enroll the highest percentage of low-income students
The second interesting finding is how much difference there can be in outcomes between colleges for low-income students. There are both private and public colleges that share a similar mission and majors within the same metropolitan area, yet the difference in outcomes can be extraordinary. What that tells me is that students should do more research on where they’re going to get the best financial outcomes. It’s not going to be the only thing that influences their pick of a college, but it’s definitely a factor.
Evo: Why is career counselling so important for today’s learners?
MVDW: Many people go to college with only a vague idea, or even no idea, of what they want to major in. We treat them too often like all these decisions are already made, and that a major is a destiny. But it’s not. Someone could major in politics and not want to be a politician but rather go into public policy or become a teacher. They might be getting an undergraduate degree to get into graduate school and become a lawyer, a psychologist, or whatever it might be.
More commonly, students have a major but no clear idea of what to do with it. That kind of ambivalence is understandable in young people. They don’t know everything yet, and they still need a lot of help. They need to know the possibilities available to them when they’re earning a degree. Colleges really need to do a better job of working with those students and placing them in appropriate careers.
Colleges are beginning to get this. I have two teenage children, so I’ve been going on college tours and noticed that a few schools make a real point of emphasizing their career center. My takeaway is that they get a lot of questions from parents and students about careers and the outcomes of attending the college. If they’re listening to their consumers—and these colleges are—they’re understanding that career centers are really important.
Evo: How important is it for higher institutions to provide clear data on potential labor market pathways stemming from their programming?
MVDW: It can be a real differentiator for colleges. There’s a lot of competition out there, and there are many colleges that the public sees as relatively similar. Certain obvious things that set them apart: the size of the college, the location, public vs. private and admission rates. If a person is considering multiple colleges, the most appealing are the ones that not only provide a great education but also set students up for future success. That’s the kind of marketing messaging that people really want to read and hear.
Evo: Given the importance of ROI, what role can shorter-term stackable programs play in creating more accessible pathways to the labor market?
MVDW: We don’t know that for sure yet. There’s a lot of rethinking and unpacking what goes into a college education and earning a credential. We are still lacking a great deal of information on the market value of microcredentials and stacked credentials. We’re moving toward them, but we don’t fully understand them yet. Higher education is slow to change. Data is still collected by all the old metrics. When you look at the College Scorecard, for example, there’s no recognition of any credential other than the traditional ones, such as a certificate, associate degree, bachelor’s degree or master’s degree. We don’t have great data on any microcredentials and their value in the labor force.
Evo: What’s the most important takeaway higher education leaders should absorb from your research?
MVDW: With this report, we focused solely on low-income students. The percentage differs by college, but generally one of every three college students qualify for Pell Grants. They’re a huge segment of the market, and the decisions they make are especially important in higher education because they literally cannot afford to make a mistake. Many of these students, if their first college experience is not a good one, never return. The payoff of higher education is more important for low-income students than it is for middle-class or wealthy students because the latter generally have the sort of family connections and social capital that can allow them to succeed, no matter what they do in college.
But low-income students are really depending on college to be a slingshot that allows them to do better than their family or their generation has done. Making a good first decision and getting good support at the college they attend is extremely important. At some highly selective colleges, as little as 10% of their students are Pell Grant recipients, compared to some of the Cal State University campuses, where over 50% of students are Pell Grant recipients. Those differences in the student body make these colleges very different places. But all campuses need to be paying more attention to the students who need college the most.
For higher education to really be a transformative experience and a launchpad for success, we really need to understand what needs to be met and services to provide for low-income students. They are not going to pursue the linear path that a lot of highly qualified students do.
We need to be engaged with the way they see higher education and push them to persist and graduate. A low-income student who attends college, takes on debt and doesn’t earn a credential experiences the worst possible outcome for them—because they probably could barely afford to go in the first place. Then if they go even further into debt and don’t have a credential that allows them to get a good enough job to pay it off, they’re even worse off than if they never attended college at all. All of us should be working to make sure that tragedies like that never occur.
Evo: How important is it for an accessible post-secondary institution to invest in creating pathways to the relevant campus activities that allow an individual to expand their reach and build the experience to which they otherwise might not have access?
MVDW: I was a Pell Grant recipient myself, and you feel very different from your classmates. Think about who low-income students are. There’s a much better chance they’re going to be, say, a first-generation student. They may not even have anyone in their close social circle who’s ever been to college. They often show up for an online class or on campus and not see anybody that looks like them or that they feel like they can relate to. As a result, they’re much more likely to drop out. In fact, they have lower graduation rates than other students. If we want to have a holistic approach to making sure these students succeed, it is more than just what happens in the classroom. We have to demonstrate that we want them to succeed by offering them a set of services and a welcoming atmosphere that is going to make them not only feel like they can succeed academically but that they fit in too. That takes a lot of thinking across basically every aspect of the college’s academic and non-academic experiences.
Evo: Is there anything you’d like to add about the research you’ve just undertaken or your research agenda for the next year and how you plan to build on this?
MVDW: This is just our latest report on ROI. We’ve done ROI reports for all colleges, even breaking down ROI by major. If anyone is interested in the data, go to our website and check it out. We are actually now starting a series of reports breaking down ROI even further because the more information we can give people about specific pursuits in higher education, the better off they will be. It comes down to the old maxim: Knowledge is power. We want to give more power to people, so they can make wise decisions about what they pursue and where they pursue it.