Higher education, debt and false dreams

It’s been hard not to pick up the Wall Street Journal in recent months, and not see an article about the the spiralling cost of higher education to students in the US and the increase in defaults on student loans. Outstanding federal and private student-loan debt is approaching $1 trillion in the US. Student loans are now the second largest form of household debt, surpassing credit cards and car loans. The White House is now proposing to forgive billions of dollars in student debt over the next decade.

Although this sounds like a promising proposal for those riddled with education loan debts, it’s clear that many students have been encouraged to borrow too much money, with the expectation that such an investment will lead to longer term salary gains. In fact recent research by economics cautions that a university degree is no guarantee of promising employment. Unfortunately many students are being sold a false dream.

Many of those burdened with loan debts are mature students who are led to believe that by paying a great deal of money to attend a university that the benefits of a degree will ensure their economic success. These mature students are often working full-time and have family commitments so it’s not surprising that not all of them complete their degrees. This leaves them with mounting debts and no qualification to show for it. A report by the Harvard Graduate School of Education shows that just 56 percent of college students complete four-year degrees within six years. The US also finished last (46 percent) for the percentage of students who completed college once they commenced, of 18 countries tracked by the OECD.

So it comes as no surprise to learn that people are looking at alternative ways of gaining a higher education without getting saddled with long-term debt. Some of these initiatives are coming from young people such as Dale Stephens, a Thiel Fellow and proud high school drop out who founded UnCollege, which assists students with designing their own educational paths. MOOCs (Massively Open Online Courses) are also being used for self-directed learning. The challenge of certification for this form of learning still remains however. This is something that the team at Acavista are committed to finding solutions for.

Who exactly is using MOOCs?

There’s lots of discussion around MOOCs (Massively Open Online Courses) these days. A recent article in the Scientific American claims that there are a number of reasons why MOOCs have become so popular. The first is that brick and mortar campuses are unlikely to keep up with the demand for higher education. It is estimated that there is a need to construct more than four new 30,000-student universities per week to accommodate the children who will reach enrolment age by 2025. MOOCs are considered to expand the reach of existing campuses. There is also increasing demand from mature learners who enter higher education to further their education and career prospects. Another major factor is the sky rocketing cost of tuition fees and student debt, particularly in the US, where student loans are estimated to exceed US $1 trillion.

So, who is using MOOCs? Coursera, the largest of three companies offering MOOCs has 2.9 million registered users from more than 220 countries. Students from the US are the highest users, followed by India. The Guardian reported this week that early analysis of MOOC students studying at the University of Edinburgh has found that most of them are mature learners who already hold one or two degrees. This is in line with other analysis of MOOC data which shows that the primary use of MOOCs has been adults seeking professional development or lifelong learning. It’s also in line with our own initial research which suggests that adult learners are actively seeking new ways of learning and engaging in higher education.

The traditional university student is changing

The higher education system has remained virtually unchanged for the past 1,000 years. At Acavista, we know that is all about to change. We aim to provide a solution to students and employers that meets their needs for more flexible higher education in a sector that has pre-dominantly offered a one-size-fits-all solution. We’re doing this by unbundling the teaching and learning so that students may choose how and when they learn, and how much they spend on learning (outside of Acavista) for their courses.
The higher education system is evolving quite rapidly at the moment. Massive Open Online Courses (or MOOCs as they are known) are getting a lot of attention. David Staley, Director of the Harvey Goldberg Center at Ohio State University speculates that MOOCs are helping to fulfill some of the needs of a growing segment of learners. He refers to these individuals as ‘autonomous learners’ who are a critical part of the emerging model of autonomous learning, where learners choose the courses that best fit a learning profile that they have devised. Autonomous learners work through courses at their own pace, and at a price they can afford. Acavista was devised with these sorts or learners in mind.
There is still a perception that the typical university student is straight from school and studying full-time whilst living at home. What in actual fact is happening is that the growth in the adult learner market is twice as great (42%) as the “traditional” student market (27%). If we look at the typical adult learner more closely, we find that in the US they are on average 38.8 years of age, have an average annual household income of of approximately $76k and are employed full-time. A majority are married, and one third have dependent children younger than 18 years of age living at home.
It is this group of students, the new “traditional” student that are inspiring many to think about ways of better servicing these students needs. Although it would be wrong to assume that autonomous learners are all adult learners, there is certainly a great deal of overlap. Our interviews with adult learners in the Australian market have validated our hypotheses that the current education system is not providing the flexibility which these students need, either to get started or to complete a degree course.