Noel-Levitz® White Paper •

October 2002

Are You Ready for the Next Generation of Students? A Five-Point Plan to Success in a New World Thomas Williams President and CEO Noel-Levitz Hold on to your hats! In these times of uncertainty, still more changes are in store for higher education. By 2012, the students enrolling in higher education will be more numerous, more diverse, and quite likely less prepared than any generation preceding them. While the increase in numbers may be welcome news for some institutions, the changing demand will also be overwhelming. Without careful planning and vision, the next generation of students will be a lost generation—missing out on the educational opportunity and access that has traditionally been afforded to previous generations.

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Using data from the U.S. Department of Education and the Census Bureau, this paper reviews the situation, identifies possible responses, and proposes an action plan for heading off the impending crisis. • Today’s sixth-grade class – the Class of 2009 – is projected to be the largest class to graduate from high school in U.S. history. • The population of 18 to 24 year-olds will rise 9 percent over the next 10 years, from close to 28 million this year to 30.5 million in 2012. • The projected number of high school graduates will increase nearly 10 percent in the next ten years, from approximately 2.9 million this year to 3.1 million in 2012. • Between 1995 and 2015, 20 percent more students are projected to enroll in U.S. colleges and universities, reaching 16 million by 2015 (assuming today’s college participation rate of about 66 percent). • Students of color – traditionally a segment that underenrolls in college – will represent 80 percent of the increase in college-aged students between 1995 and 2015.

“Enrollment leadership for this new generation of students will be defined by a firm call to action, thoughtful planning, solid preparation, and fullscale implementation of a new higher education paradigm.”

In the face of this population surge—greater than that of the baby boomer 1950s— some important questions emerge: 1.What if these large numbers of prospective students do not enroll in college? What opportunities will be lost – for the individuals, institutions, and society? 2.What if they do enroll? Are colleges and universities ready to accept them and help them succeed to graduation? 3.What are the financial implications to schools of not retaining students through graduation? Change will be the operative word for educating the population of the 21st century. The good news is that all tiers of schools can take specific steps to meet the enrollment challenge and benefit from it. Enrollment leadership for this new generation of students will be defined by a firm call to action, thoughtful planning, solid preparation, and fullscale implementation of a new higher education paradigm. “Business as usual” will no longer be an option. Are you ready?

Projected Number of High School Graduates 3.5 million 3.0 million 2.5 million 2.0 million 1.5 million 1.0 million

Projected Actual

.5 million

19

87 19 88 19 89 19 90 19 91 19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00 20 01 20 02 20 03 20 04 20 05 20 06 20 07 20 08 20 09 20 10 20 11 20 12

0

Source: National Center for Education Statistics, Projection of Education Statistics Through 2012, August 2002

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Are You Ready for the Next Generation of Students?

A Changing Demographic In the next several years, as many as 11 percent more high school graduates – up to 75 percent of them – are expected to pursue some form of post-secondary education. Many colleges and universities may breathe an initial sigh of relief at that news, thinking of rising applicant pools and potential recruits. But think again. Not only will institutions see greater numbers of potential students, they will find students of different, and varied, demographics. How many institutions are prepared for the major shifts in vision, mission, and day-to-day operations these demographics will require? By 2015:

• Nearly 50 percent of the new growth will be Hispanic. • Among minority students, 45 percent will come from families with the lowest estimated family contribution. With only 6 percent of the students from the lowest income group earning bachelor’s degrees today – versus 40 percent of high-income students – it is clear that the fastest-growing segment of college-aged individuals will be the one that has traditionally enrolled in college at the lowest rates and the one that has encountered the greatest barriers to success after enrolling. Who will serve these students?

• Students of color will represent 80 percent of the increase in collegeaged students.

Student Population—1997

Student Population—2015

28% 36%

64%

72% White, nonminority Minority

White, nonminority Minority

Source: National Center for Education Statistics, Carnevale, Anthony P., and Richard Fry

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Are You Ready for the Next Generation of Students?

The Responsibility to Educate How will colleges and universities acknowledge – and embrace – these changing demographics? Will “business as usual” perpetuate impressions of educational elitism and risk the emergence of a dual economy – one for the

middle-income “mainstream” and one for low-income minorities? Will the economic difference between a college degree and a high school diploma become even greater? Consider: • Individuals who hold at least a bachelor’s degree earn a median household income double that of high school graduates.

Median Household Income by Educational Attainment of Householder (2001) Doctoral Degree

$92,806 $100,000

Professional Degree $78,902

Master's Degree $67,165

Bachelor's Degree

$72,284

Bachelor's Degree and more $51,162

Associates Degree

$45,810

Some college, no degree $36,055

High School graduate/GED 0

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

Source: U.S. Census Bureau, Current Population Survey (2001 income data, published September 23, 2002)

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Are You Ready for the Next Generation of Students?

• The 2001 unemployment rate for college graduates stood at 2.3 percent, versus 4.2 percent for those with only a high school diploma. • Fully 60 percent of new jobs that will be created between now and 2010 will require at least some postsecondary training, thanks to the 21st century’s knowledge-based economy.

The next generation of college-aged students are indeed the future of this country. Do these students – traditionally underprepared and with the greatest financial need – deserve the opportunity to earn college degrees? And what are the consequences of them not obtaining higher education? Who will be prepared to educate and graduate these students?

• Narrowing the gap in college-going rates between high- and low-income individuals would add nearly $250 billion to the gross domestic product, and almost $80 billion to U.S. tax coffers.

Projected Job Growth (2000-2010) by Required Education

Other 40%

Jobs Requiring PostSecondary Education

60%

Other Moderate training Long-term training Associate or vocational award Bachelor's degree or higher

Source: Bureau of Labor Statistics, December 3, 2001

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Are You Ready for the Next Generation of Students?

Access to Higher Education Will colleges or universities that are prepared to teach a new demographic be prepared to meet the financial challenges of enrolling or serving this new population of students? Given their economic status, will these potential students, over the next several years, view college as accessible to them?

a recent NACUBO survey, how likely is it that the private sector will be willing or able to enroll significantly more lowincome students? State-supported institutions are being challenged to do more with fewer resources. Can they continue to provide high quality programs and services to more and more students, particularly those who have great financial need?

The access issue extends to both private and public institutions. To date, many low-income students have been able to enroll in private institutions with the help of federal and state aid. However, funding for federal and state financial aid programs has not kept pace with rising tuition rates. This trend could make it harder for low- and middleincome families to pay for higher education. And with the institutional discount rates among private colleges holding at about 40 percent, according to

• Twenty-five states currently face budget cuts or rescissions in their higher education budgets. • Seventeen states raised tuition by more than 10 percent for the 2002-03 school year. • Grants and loans as a percentage of total aid have reversed their positions over the past eight years. Almost 60 percent of student aid today is through loans, versus just over 40 percent in 1994.

Percent Change in Tuition at Public Universities (2002-03) 25

20

15

10 Median = 9.3

5

0 Selected State Universities

Source: University of Alaska Institutional Research

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Are You Ready for the Next Generation of Students?

• The purchasing power of the Pell Grant continues to decline. The maximum Pell Grant as a share of cost of college attendance has declined steadily through the 1990s, standing at 39 percent for public institutions and 15 percent for private institutions. • According to the College Board, college tuition has increased 63.4 percent since 1992. By comparison, health care costs have risen by 43.5 percent. • The proportion of state grants awarded based on need has steadily fallen. Entitlement and merit-based grant programs appear to be replacing needbased aid as the focus of policy makers at the federal, state, and institutional levels. Will the opportunity to pursue a college degree remain as a financially viable goal for low-income students?

The fact that academically qualified, low-income students attend four-year institutions at half the rate of comparably qualified high-income peers provides one of the most sobering views of this country’s educational and economic future. What almost every leader in higher education knows is that, in spite of federal, state, and institutional financial aid, economic status still determines college participation and educational attainment. Achieving and maintaining access for this rapidly growing segment of the college-aged population, while providing a high-quality academic experience supported by top-notch services, represents one of higher education’s greatest challenges in the next decade. Meeting this challenge will require a major shift from enrollment management to enrollment leadership.

Percentage of State Grants Awarded Based on Need 90 88 86 84 82 80 78 76 74 72 70 1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

Source: National Association of State Scholarship and Grant Programs

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Are You Ready for the Next Generation of Students?

On a Mission...To a Solution...A Five-Point Plan

new market. Institutions that are ready to make the commitment can set in motion a five-point plan today.

Who will lead? Never before in the history of higher education has there been the combination of population growth, diversity, and opportunity for colleges to make a difference on such a large scale. And many institutions will accept the challenge – to embrace the future and become champions for change.

1. Revisit your mission Past performance in higher education must not limit colleges and universities in planning for the future. Visionary leaders will be able to assess changing market conditions and exercise the flexibility to respond to them, reorganizing to meet the demand for post-secondary education among the growing number of first-generation and “at-risk” students.

The changes will be fundamental. Institutional missions, approaches to teaching and learning, the availability and delivery of programs and services, and the definitions of academic quality and enrollment management will undergo careful scrutiny in response to the

2. Develop an institutional focus on student persistence and success Statistically, less than 60 percent of students who start college in the United States graduate, with most of those who drop out doing so in the first two years.

Estimated Dropout and Graduation Rates

Graduated 59%

1st Year 21%

2nd Year 11%

3rd & later 9% Source: Consortium for Student Retention Data Exchange 2001-02 Executive Summary (July 2002)

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Are You Ready for the Next Generation of Students?

What has been a problem of inefficiency must not evolve into a full-blown crisis. The growth segments of the new market for higher education include students who may require more – not less – support and service. Colleges and universities that succeed in the changing market will begin asking, “Can we graduate a class?” in place of “Can we recruit a class?” The champions for change at the nation’s colleges and universities will integrate retention – the quality of student life and learning – into the formal structure of enrollment leadership. The shift is already underway to expand the measure of quality in higher education beyond the profile of the entering class to include outcomes: student success and graduation rates.

3. Practice strategic enrollment leadership Serving the rapidly growing number of college-aged students from vastly different demographics will require shifting from enrollment management to enrollment leadership. Identifying and attracting students will require using new enrollment technologies that support one-to-one marketing and oneto-one student success plans. The new enrollment leadership will focus on teamwork, taking a long-term view, setting an example, and energizing others. True higher education leaders will make significant investments to channel this diverse student population toward success. They will work to make the new market as successful as possible.

Enrollment Funnel – Four-year Public: 4.4% “survival” on funnel of 100 inquiries

Enrollment Funnel – Four-year Private: 1.7% “survival” on funnel of 100 inquiries

100 Inquiries

100 Inquiries

28 Applications

12 Applications

21 Offered admission

9 Offered admission

11 Enrolled students

4 Enrolled students

3 Graduates (in 4 years)

2 Graduates (in 4 years)

Source: 2001-02 National Enrollment Management Survey and Consortium for Student Retention Data Exchange

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Are You Ready for the Next Generation of Students?

4. Make and sustain the commitment The decision to adapt to market conditions must occur at the executive level. Successful enrollment leaders will share the vision with faculty and staff who will be responsible for activating that vision on a day-to-day basis. This will require adjusting to new ways of teaching and serving a different group of students. Once students are admitted, the campus community will mobilize to help them succeed.

5. The Field of Dreams: Making it happen Education works only if students learn – and to learn they must enroll, persist, and earn degrees. “Building it” has never assured us that “they will come.” That concept applies even more to the students in the growth segments of the new college-aged population. The coming changes in the collegeaged population will require us to develop a new paradigm for higher education. Deciding on a “paradigm shift” is one thing. Implementing it is another. How each institution will meet the needs of the changing demographics will depend on its unique character, features, history, location, and more. Some constants: a. Capacity increase – Because population growth of this magnitude will require more capacity than what is available today, colleges must find more creative and cost-effective ways to strategically increase capacity. Instead of capping enrollments, schools looking to serve the coming population likely will need to find ways to grow without the traditional investment in bricks and mortar. The trend toward hiring more adjunct faculty and part-time staff is one practice that will continue. Other alternatives requiring minimal incremental cost include: more flexible schedules that extend the class day from early in the morning to

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late at night; weekend sessions; branch and satellite campuses that expand the geographic market; and alternative delivery systems such as distance learning. b. Distance education – Distance learning is likely to become a staple among institutions of all types and at all levels. Whether online, through partnering institutions, with local business and industry, through community support, or by other means, schools will need to take the initiative to develop creative alternatives. c. Developmental and remedial programs – Focus on retention means that schools must make a corresponding shift to help these new student demographics succeed. Bridge programs and developmental and remedial programs will need to become standard offerings at institutions seeking to serve these students. d.Strategic partnerships – In some cases, it may make sense for higher education institutions to engage in active partnerships with secondary schools not simply to recruit, but to raise awareness of and appreciation for the benefits of a college education, and to help better prepare students for college. e. Funding strategies – Paying for the paradigm shift in higher education poses serious public policy questions and challenges even the best of strategic planners. Significant costs will be associated with better preparing and motivating potential college-bound students earlier in their secondary school careers, and identifying and attracting them to institutions committed to serving them and capable of supporting them through graduation. The question of who pays must be resolved at the national, state, and local levels – and soon.

Are You Ready for the Next Generation of Students?

Conclusion Higher education has reached a crossroads where traditions, missions, and public policy trends are colliding with unprecedented population growth and diversity. The changing needs and expectations of nearly every constituency – the general public, business and industry, and government – require every higher education leader to respond quickly and decisively. More than ever, higher education’s heritage and traditions cannot be its destiny. Are you ready?

Thomas Williams

Noel-Levitz

Thomas Williams, president and CEO of Noel-Levitz, is one of higher education’s leading authorities on enrollment management. With nearly 30 years’ experience in enrollment management, he has consulted directly with more than 500 colleges and universities, engineered numerous enrollment successes, and been a driving force in elevating NoelLevitz to its leadership role as higher education’s largest and most successful enrollment management consulting firm.

Noel-Levitz is a results-oriented consulting firm that specializes in enrollment management for educational institutions. Areas of focus include staff development, student recruitment, financial aid, student retention, market research, publications, and Web site development. Since 1973, Noel-Levitz has worked with more than 1,600 universities and colleges throughout North America. The company is currently consulting with 250 institutions. Noel-Levitz has offices in Denver, Iowa City, and Guelph, Ontario, and is a Sallie Mae company. For more information, call 800-876-1117 or visit www.noellevitz.com.

He can be reached at [email protected].

Sallie Mae Sallie Mae is the nation’s leading provider of education funding. The company primarily provides federally guaranteed student loans originated under the Federal Family Education Loan Program (FFELP), and offers comprehensive information and resources to guide students, parents, and guidance professionals through the financial aid process. More information is available at www.salliemae.com.

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Are You Ready for the Next Generation of Students?

References For Further Reading Advisory Committee on Student Financial Assistance, Empty Promises: The Myth of College Access in America, Washington, D.C.: 2002 (available at http://www.ed.gov/offices/AC/ACSFA) Advisory Committee on Student Financial Assistance, Access Denied, Washington, D.C.: 2001 (available at http://www.ed.gov/offices/AC/ACSFA) Anthony P. Carnevale, Richard A. Fry, Can We Achieve Equity When Generation Y Goes to College? Princeton, NJ: 2000 (available at http://www.ets.org/research/ publeadpubs.html) Center for Institutional Data Exchange and Analysis, The University of Oklahoma, 2001-02 CSRDE Report, Norman, OK: 2002 College Board. Trends in student aid 2001. Washington, D.C.: 2001 (available at http://www.collegeboard.com/research) Thomas G. Mortenson, Postsecondary OPPORTUNITY, Oskaloosa, IA (available at http://www.postsecondary.org) National Association of State Universities and Land-Grant Colleges, 2002/03 Tuition and Fee Charges Survey, Washington, D.C.: 2002 (available at http:// www.nasulgc.org/) Noel-Levitz, Special analysis of National Enrollment Management Survey, Denver, CO: 2002 U.S. Bureau of Labor Statistics, Division of Consumer Prices and Price Indexes, Washington, D.C. (available at http://www.bls.gov/cpi/home.htm) U.S. Bureau of Labor Statistics, Office of Occupational Statistics and Employment Projections, Washington, D.C. (available at http://www.bls.gov/emp/) U.S. Census Bureau, Housing and Household Economic Statistics Information Staff, HINC-01 (available at http://www.census.gov/hhes/income) U.S. Census Bureau, Population Projections Program, Population Division, Washington, D.C. (available at www.census.gov) U.S. Department of Education, National Center for Education Statistics, Projections of Education Statistics to 2012, (NCES 2002–030), by Debra E. Gerald and William J. Hussar. Washington, D.C.: 2002.

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Are You Ready for the Next Generation of Students?