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Leaders & Laggards Takes a Hard Look at Higher Ed

The Institute for a Competitive Workforce (an arm of the U.S. Chamber of Commerce) yesterday published an expansive new state-by-state report on public higher education: Leaders and Laggards: A State-by-State Report Card on Public Postsecondary Education. The lead researcher on the effort was my talented AEI colleague Andrew Kelly, who put in six months of data gathering with the aid of crack AEI research associate Daniel Lautzenheiser and ICW's terrific Jaimie Matthews. (Full disclosure: I served as part of the project team, along with my Brookings Institution counterpart Russ Whitehurst; the Chamber's Margaret Spellings, Cheryl Oldham, and Dom Giandomenico; and Ben Wildavsky of the Kauffman Foundation).

The report doesn't purport to examine private institutions or issues rated to higher education research--it's focused on better understanding how states are faring when it comes to the educational performance of public two-year and four-year institutions. Under Andrew's direction, we graded states on six metrics, all focused on whether: state systems are delivering good value for dollars spent, states and institutions are providing transparency and good information, and policy is supporting smart problem-solving and the effective use of online instruction. The six specific areas of inquiry were:

Student Access & Success: Do state institutions retain and graduate a high percentage of their students within a reasonable amount of time and do they ensure access for low-income students?

Efficiency & Cost-Effectiveness: How much money do public institutions spend on education and related expenses per degree produced?

Meeting Labor Market Demand: How much better do college graduates fare than their less-educated peers in terms of employment and wages?

Transparency & Accountability: Do states measure learning and labor market outcomes? Do they routinely make information on the performance of the higher education system available to the public?

Policy Environment: Do states have policies in place that provide incentives to promote degree completion and allow students to transfer course credits freely within the system?

Innovation: Have states made efforts to embrace innovative ways of delivering college instruction and do states encourage innovative providers to serve nontraditional students who may be underserved by the existing system?

Some really intriguing findings emerged. Statewide completion rates at four-year public colleges typically hover around 50 percent. Thirty-three states spend more than $50,000 in education and related expenses to produce a credential at a two-year college. Fewer than half of the states can track the labor force outcomes for graduates and make those data public, while just four states publish data that allow students and taxpayers to compare such data across institutions and programs.

Alaska's system stood out as exceptionally expensive, with cost per completion of over $142,000 at the four-year level and almost $270,000 (!) per completed credential at the two-year level. For instance, in 2009, Alaska's lone non-tribal community college spent more than $4,000,000 in education and related expenses and produced 21 associate's degrees. On the other hand, Florida and Texas report a cost per completion of under $50,000 at the four-year level.

Interested readers can check all of this out using the Chamber's nifty online tool.

Across the nation, we consistently found that colleges and universities are failing to provide data that would allow consumers to compare their performance with that of other institutions. Students and families need such information to make informed decisions about whether enrolling in a particular program or institution is worthwhile. Moreover, taxpayers and business leaders need performance data to hold colleges and universities accountable and to know which institutions are producing graduates with a high-quality education. State leaders are uniquely positioned to serve as objective scorekeepers.

When it comes to recommendations, it's important to note that the report does not suggest that there is a single right way to address challenges in postsecondary education. For instance, it very intentionally steers away from recommending any crude, test-based vision of accountability or any wholesale shift to funding institutions solely on degrees completed. We fear that such measures, especially if pursued clumsily, could do more harm than good.

Broadly speaking, we suggest that states should find solutions that match their own state policies, embrace transparency around data, and focus on performance, not inputs. For instance, we suggest that states should start to shift away from funding formulas that are based too heavily on student enrollment. They should instead require that some portion of each institution's base funding be tied to timely degree completion, making sure that students who enroll finish their degrees in a timely manner, while also removing the obstacles students face when seeking to transfer credits between institutions.

Anyway, there's a slew of interesting data worth checking out. Would love to hear your reactions, thoughts, suggestions, and criticisms. (By the way, as you'll see in the report, we're well aware of the massive data limitations here and of how that limits how far we can or should go in interpreting our findings. To our minds, that's mostly an indictment of where higher education is with regards to transparency and reporting--and it's our hope that this report can help nudge states and institutions to step up accordingly.)

Note: in the original post, I mistakenly left out Dom Giandomenico from the Chamber in the list of the project team.

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