What Higher Education May Look Like in the Future.

• Author: Leef, George C.

Can anyone remember what the telecommunications industry was like forty years ago?

That might be difficult, and for younger readers perhaps impossible, because there has been so much change. In brief, however, the industry used to be a staid, regulated quasi-monopoly where there was little innovation. Everyone used landline telephones and was quite content with arrangements. Content or not, there wasn't any choice.

Then came deregulation of the telephone industry in the 1980s, followed by immense technological innovation in cell phones and computers to communicate. Today, it's rare to use a landline phone. The banks of pay phones that used to consume wall space in public places are gone, and nobody worries about the cost of long-distance calls any longer. The telecommunications industry has been utterly transformed and now serves consumers far better and at lower cost.

We believe that something similar will occur in higher education. Catalyzed by the Higher Education Act of 1965, the industry grew spectacularly for decades, with enrollments peaking about ten years ago. Whereas college education had formerly appealed to a small segment of the population, by the 1980s it was becoming "common knowledge" in America that if you wanted to get a good job, you needed a college degree. The government encouraged college enrollment with grants and easy loans, while politicians and higher education leaders assured students that borrowing for college was a great investment. Students flocked in, even those with weak academic records and minimal interest in scholarly studies. The influx of such students posed a problem for college leaders--how to keep, them enrolled? They didn't like or expect hard work and under the traditional standards would likely have quickly failed out.

Most institutions decided to keep the student money flowing, and that meant letting their standards decline. The curriculum was therefore altered to eliminate demanding required courses and offer many new ones that were more fun and trendier. Grade inflation was allowed, or even encouraged. More and more students graduated with their credentials, but many had very weak skills. As Richard Arum and Josipa Roksa argued in Academically Adrift (2010), a substantial percentage of college students in the twenty-first century were graduating from college with little or no advancement in knowledge from when they were in high school. Furthermore, many schools have allowed themselves to be deeply politicized, with faculty who are more interested in proselytizing for their favorite causes than teaching bodies of knowledge. College study today bears little resemblance to college study in the past.

At the same time the educational benefits of college were falling, the cost of attendance was rising--rapidly. Consequently, the value proposition of college education had changed dramatically from what it was in the 1960s. A bachelor's degree no longer betokened any special capabilities to prospective employers, but acquiring one cost students and their families dearly.

In some ways, the old-fashioned bachelor's degree has become like the landline phone. Changes in consumer demand combined with new educational offerings are apt to disrupt the higher education marketplace. Some institutions will survive without much change (especially those schools offering essential professional training), but many others will have to either dramatically change to attract students/customers or else go out of business. We foresee a whirlwind of Schumpeterian creative destruction in higher education in the next thirty years.

Legacy Higher Education

Some schools, however, are insulated against the whirlwind, particularly elite institutions as well as those offering professional studies that are essential...