Showing posts with label Higher Education Inquirer. Show all posts
Showing posts with label Higher Education Inquirer. Show all posts

Sunday, July 10, 2022

Colleges Are Outsourcing Their Teaching Mission to For-Profit Companies. Is That A Good Thing?

Years ago, colleges employed people to perform auxiliary services. University employees staffed the campus bookstore, ran the student union, and performed janitorial services. 

Over time, however, universities began outsourcing almost all of their auxiliary services. Barnes & Noble now runs hundreds of college bookstores. National fast-food chains operate stores in countless student unions.

Recently, however, American colleges have gone beyond outsourcing their non-instructional activities. Now, the universities are outsourcing their core mission: teaching students.  

According to the Government Accountability Office (as reported in the Wall Street Journal), 550 colleges and universities are partnering with for-profit companies to design courses, recruit students, and manage instruction.

Academic Partnerships, one of the leading for-profit outfits,  contracts with universities all over the United States to manage graduate programs--for a hefty fee, of course.  Higher Education Inquirer estimates that AP collects about half the revenue from the courses and programs they manage.

2U, another for-profit online instruction provider, has a contract for services with the University of Oregon and gets 80 percent of the tuition for 2U-managed courses. That's a good deal for 2U's stockholders.

What the hell is going on? 

As the Wall Street Journal explained, colleges are losing revenue due to declining enrollments.  They aren't raising enough money to pay all their administrators and bureaucrats. Thus, hundreds of schools are investing heavily in online academic programs--especially graduate programs--to juice their revenues. 

Respected public universities like the University of North Carolina and the University of Oregon have turned to for-profit companies to design or revamp various graduate programs, recruit students, and oversee instruction.

Why don't the professors do those things?

I don't know. Perhaps the faculty don't have the skills necessary to recruit students, manage enrollment, or design academic programs for an online format.  Or maybe doing these things is just too fuckin' hard.

I have a professor friend whose dean ordered him to design and teach an online course for a master's degree program managed by Academic Partnerships. He was told the class would be conducted online over five weeks.  

My friend was a good soldier and taught the course as directed. He had over 600 online students!  When the class was completed, my friend told the dean he would never teach an online course that way again, even if it meant being fired.

As the Wall Street Journal pointed out, students are often unaware that they are taking a course managed by a profit-driven company, not the university. 

For example, the University of Texas at Arlington has a big-time financial relationship with Academic Partnerships, which manages graduate programs in nursing, education, business, and public health. Nevertheless, UTA's promotional materials do not disclose that Academic Partnerships manages these online graduate programs.

Students all over the United States are taking out loans to pay tuition bills at public universities in the naive belief that these schools are non-profit entities dedicated solely to the public good.  

Most of these students would be surprised to learn that a profit-making company is sucking up a good share of their tuition dollars to enrich their executives and investors.

My take on this? If a public university is so goddamn lazy or incompetent that it has to pay a private company to manage its academic programs, then that university should be closed. 





Friday, February 4, 2022

Voting with their feet: College enrollment dropped by 475,000 students in the fall of 2021

As the Chronicle of Higher Education reported recently, college enrollment dropped by 475,000 students last fall. Since the COVID pandemic began two years ago, undergraduate enrollment has plunged by 9.2 percent.

A look at college enrollment over the last 10 years shows an even more dramatic decline.  Dahn Shaulis, writing for Higher Education Inquirer, reported that college enrollment is down by 20 percent or more in 18 states during the past decade. Unless conditions change, Shaulis writes, most states will see enrollments drop by 25 percent in the 20226-2027 academic year when compared to enrollment levels in 2010.

COVID is blamed for the recent enrollment exodus.  Doug Shapiro, Executive Director of the National Student Clearing House Research Center, said that students "are continuing to sit out in droves" due to the pandemic, which has forced colleges all over the U.S. to switch from face-to-face instruction to an online teaching format.

But there are larger forces at play. As Shaulis explained:

Enrollment declines are the result of several interrelated economic and demographic shifts. Reduced populations of college age people, economic distress, growing inequality, and migration are some of the interacting factors. 

 And there is another factor at work--difficult to quantify. Young people have begun to figure out that a college education is too damned expensive and often does not lead to a good job.  Liberal arts majors, in particular, often find that their college degree was not a ticket to the good life. Instead, it was a trap that ensnared them in debt and sentenced them to a life of penury. 

Perhaps that is why the number of students majoring in the liberal arts declined by almost a million students last fall, a drop of 7.6 percent from the previous year (as reported by CHE).

We're outta here!


Tuesday, February 1, 2022

Who the hell is Maximus--the new giant student-loan servicer?

 On October 20 of last year, the Department of Education announced that Navient, a giant student-loan servicer, was turning its business over to Maximus, a government services company. 

DOE spokesperson Richard Cordray said this about the switchover:

We are confident this decision is in the best interest of the approximately 5.6 million federal student loan borrowers who will be serviced by Maximus and will provide the stability and high-quality service they deserve.

So, who the hell is Maximus? To start with, it is a publicly-traded company whose shares are worth about $77.  Bruce Caswell, Maximus's CEO, is well compensated; he made more than $6 million last year.

Maximus has 35,000 employees, including the drudges who chase down student-loan defaulters. How much do the low-end employees make? The new minimum wage for federal contractors was recently raised to $15 an hour. Last year, Maximus's hourly wage for low-end workers was around 13 bucks.

Forty-five million Americans have outstanding student loans, and Maximus will be servicing 5.6 million of them. For those lucky millions, Maximus will be collecting student-loan payments and keeping track of delinquent debtors and defaulters.  Maximus will also replace Navient as the agent that will help student-loan borrowers switch repayment plans and certify eligibility for loan-forgiveness programs.

Navient, you recall, recently settled multiple lawsuits accusing it of deceptive trade practices.  As Pennsylvania's Attorney General summarized:

Navient repeatedly and deliberately put profits ahead of its borrowers – it engaged in deceptive and abusive practices, targeted students who it knew would struggle to pay loans back, and placed an unfair burden on people trying to improve their lives through education.

Will Maximus do a better job servicing student loans than Navient? Maybe, but probably not.

However, of one thing you can be sure. Navient's stockholders will do alright. And who are those stockholders?

They include institutional investors like BlackRock and giant banks such as Wells Fargo and Bank of America. 

And--ponder this: At least 17 public-employee retirement funds own shares in Maximus, including funds for California, Louisiana, New York, Oregon, and Wisconsin.

So if you are one of those 5.6 million Americans whose student loans are being serviced by Maximus and you are being ground down by your debt, you can take comfort in the fact that a lot of massive institutions--both public and private--are doing just fine.

Note: This blog relies heavily on Dahn Shaulis's reporting for Higher Education Inquirer