According to NCES, US Department of Education, post-secondary institutions in the United States spent $536 billion (in current dollars) in 2014/15. Total expenses were $336 billion at public institutions, $182 billion at private nonprofit institutions, and $18 billion at private for-profit institutions.
Excluding student lending support, the U.S. Federal government spent $75.6 billion on higher education programs, states spent $72.7 billion, and local governments spent $9.2 billion. The public funds total $157.5 billion or 30% of higher education’s annual expenditures. If my calculator is correct, that averages $25K per enrolled student (with 21 million enrolled). Not surprising, 30% or $7,500 of higher education expenditures are subsidized by government sources.
The 2015 Pew analysis further drills into the NCES data. It shows State higher ed funding varies quite a bit. The Pew analysis shows a range of funding sources leading me to wonder how funding – and strategies led by policy are impacting the number of degrees awarded by their respective institutions annually. With many implications like the cost of living buried, how learning opportunities are offered, the goal to increase degree holders across the union is challenged further by eroding financial support for higher education. At least, that is my take on the numbers. All the while, expenses continue to ratchet up as State appropriations have been declined over the last decade. Some States are fairing better than others finding funding. So, a lot is embedded in these numbers from a macro perspective.
Many states have adopted degree completion goals like 60% by 2025 advocated by private foundations and public policy groups.
Hidden within the funding and attainment data, is how States augment priorities with governance and action. The chart shows Florida is lowest in funding for example, yet they also are fourth in overall degree production out of all States. California, New York and Texas have three totally different forms of governance, sharing initiatives and outcomes in different ways. The level of institutional autonomy, direction and shared initiatives, we believe, is a factor why some States are getting more done together at lower costs, than those with a high degree of institutional autonomy and live with the diverse methods employed. This would be worth further analysis in future posts with greater detail.
AcademyOne has been fortunate to work on a number of State led projects (across regions). We can speak to how shared academic, administrative and technology resources in support of state led initiatives are marshaled to improve outcomes. We can speak to how data management interfaces and data standards are employed to lower costs and offer sustainable methods regardless of institution size or capability. So that means all institutions can share in the benefits equally much like a utility offers power or water to a community.
For instance, we have shared platforms to build guided pathways, assess and articulate prior learning, streamline transfer information across institutions, improve adult degree completion information and scale revere transfer workflows for thousands of currently enrolled four year students who originally attended a community college but never finished. These are good are examples of how shared initiatives can get more done for less cost. Most of our platforms save institutional costs by reducing duplication and offline manual tasks. They avoid reinventing methods and duplicated data management (for example keeping track of programs of study, courses taught by others and all the artifacts. Every institution needs access to shared data and services if there is any interaction with learners who cross institutional boundaries. We have demonstrated how States can incubate shared data and tools which enables them to do more with the same funding - but this requires compromises and shared agreement.
Many States, over time, have tuned state-wide academic programs, like guided state pathways and common course numbering to foster degree completion without sharing resources. It is presumed these devices can help learners as static resources and references. This has led to significant duplication and costs across institutions as they embed how methods are employed across the varied Information Management Systems employed standalone with varied capabilities. Some of the highest spending States reflect greater institutional autonomy at the expense of losing the ability to reduce costs, improve services and outcomes.
In today's cloud enabled Internet, should institutions advocate for separate but not equal data system support from States, reinforced by assumptions they desire autonomy over lower costs, generally steering their reinvention?
Are the fears losing control of "data", "privacy" and "security" simply misaligned and overstated? Institution often require standalone and separate implementations supporting their variation and adaption to serve local concerns. This has to contribute to the friction supporting State led initiatives and why the variation in outcomes is so high. It would be a good thing to compare how States fared mitigating these fears.
Some States have shared identity management support, shared state-wide portals, shared transcript exchanges, shared student information systems and shared longitudinal data systems. Not all are shared across institutional types though including not-for-profit or for-profit. So much varies as a result of governance and how each State looks at their role working with the whole marketplace, not simply the Publics.
The landscape of higher ed governance is varied, some split across multiple State systems, some formed under P20 (K12 and Higher Ed) while others roll up under Department of Education or Boards of Regents or Commissions. Depending on how the States view their role working with Higher Ed as an economic stimulant, the level of disparate and scattered actions erodes or grows reflecting differentiation that magnifies or shrinks between systems and institutions.
There must be some cause and effect happening in States when we see the range of revenue/expenditures per degree from $48K to $162K – three fold difference!
Some States are driving costs down with online distance learning, hybrid learning and getting higher degree production from liberalizing policies – assuming they are comparable in quality.
Other States have much higher revenue/expenditures with less degree production - as institutions direct their own resources with differentiation and more varied outcomes. This is a good topic for further exploration and future posts.
As a quick peak, here are the top six States in degree production and cost per degree (average) using the NCES data. You can see, the outcomes and funding radically differ between Florida at the low and Texas at the high.
From one point of view, shared methods and platforms can help States shift expenditures to fund scholarships, grants and other programs such as Georgia Hope, Florida Shines and Tennessee Reconnect. This requires institutions to give up some of their autonomy for increased state-led initiatives. We also know Targeting Workforce Credentialing, Automating Reverse Transfer, Publishing Transfer Guides and Promoting Adult Degree Completion has helped improve enrollment and completion.
What more can States or for that matter the industry do to improve outcomes without expecting more funding? Re-engineer. It's a proactive effort that allows members and stakeholders to voluntarily join and support. Working together is the best way to improve outcomes. Share you thoughts.