Retention as a Budget Saver

By Watson Scott Swail, President and CEO of Educational Policy Institute and EPI International

Next week is a big week for EPI, as we stage the Fourth Annual International Conference on Student Retention, or RETENTION 2009, in New Orleans, Louisiana. This sounds like a marketing lead to our conference, starting May 27th in New Orleans, Louisiana, with CNN Hero of the Year Liz McCartney and former Philadelphia Eagle Vince Papale (“Invincible”), but it’s not. Really. That stated, please feel free to register at the EPI website, or just click on the ad to the right.

The conference and subject area both come at an interesting time for higher education. With large state cuts in higher education funding plus serious declines in US prosperity and productivity aligned with increases in unemployment, institutions and systems are at a precarious state with regard to what they will do and where they may go. [As an aside, next week we will be releasing the inaugural issue of The Swail Letter on Higher Education, a new monthly subscription report on a variety of issues. In the first issue, we’ll tackle this state funding issue as well as occupational growth and the linkage to higher education].

My commentary comes in part from a phone call I had yesterday with a reporter in Michigan, poor dear, who wanted to know what the answer is to rectifying the funding problem in higher education. It was a long conversation. It seems that Michigan, those standalones, have massive state cutbacks and their institutions are forced to increase tuition. I’m really glad this isn’t a systemic issue (tongue is very much through the cheek at this point, for those who don’t have the DNA to pick up sarcasm in print). In fact, the papers this morning here in Virginia reported that Virginia community colleges will increase tuition fees by ONLY single digits this year. It’s a rampant and volatile issue.

I’ve plodded on about the cost issue enough in past commentaries, so I’ll try not to digress. My 10 cent observation for the reporter is that we have to contain higher education costs, but that it is a uniquely difficult task because 80 percent of higher education budgets are human resources. These are very difficult to cut considering that health care and other HR costs are skyrocketing. You can only streamline so much. The real answer on the cost side of the equation is what we do about instruction and physical plant (see Alex’ commentary last week). If it costs so much to instruct 30 students in the traditional way, then we have to find a way to cut that cost in half or double the number of students for the same money. How do we do that? Either find less expensive instructors or reduce the cost of instruction using technology and other pedagogical strategies. Of course, we need to do both. Ultimately, cost of instruction must come down in a major way for us to “balance” budgets and deal with this higher education financial crisis, which is what it is. Distance technology, even used as an intranet manner, is a major piece of the future of higher education, regardless of what detractors say.

In retrospect, though, I left one important concept out of my discussion with the reporter. We need to retain more students. The point seems lost on many people that, if we consider higher education from an efficiency standpoint, we are a sieve at best: we lose almost 50 percent of our students. Thus, we pay a whole lot to recruit, admit, and enroll students, only to have 1 out of every 2 leave during the first, second, or third years. Not only is that bad business, but it embodies a ridiculous misuse of public resources (considering public institutions and taxpayer subsidies).

The retention standpoint has a number of important perspectives. As discussed, it is a financial issue. If you don’t believe that, go directly to our Retention Calculator this instant and calculate your losses (and potential savings) from retaining even a fraction more students. Saving students saves dollars. It’s that simple.

The second perspective is that of building business, industry, and the economy. Two weeks ago I was pleased to participate and speak at the Third Annual Conference on Understanding Interventions conference put on by the American Association for the Advancement of Science (AAAS) and led by my good friend Daryl Chubin (also an EPI Advisory Board member). The basis of that discussion is that there are not enough engineers, especially those of color and women, in the US workforce. It’s one thing to attract and enroll students to engineering and other disciplines and occupational pathways. But when we lose 80 percent of them, as we do in some of these areas, it doesn’t help us fill voids in the workplace. Again, it comes down to efficiency. If 80 percent of students leave a program or field, it makes two large statements—(a) we don’t prepare them very well for higher education; and (b) we don’t educate them very well when we have them. Yes, it says a lot more than that, but those are the big bucket issues. Higher education can’t do too much for (a), but it owns (b) completely, and it mostly fails.  

For the sciences, this is a tough challenge to attract and retain minority students and women. Most end up leaving engineering and other hard sciences and going to business or social science areas. Or they leave altogether.

I wish I could provide good details on the percentage and number of students that leave engineering and similar disciplines, but I can’t. In preparation for my talk at the AAAS conference, I used IPEDS and BPS studies in an attempt to pull numbers for background, but they don’t produce very good results at that level of detail. The National Science Foundation and National Institutes for Health (NIH) don’t really have anything of worth with regard to retention and graduation.

For these reasons, the American Society for Engineering Education (ASEE) pulled together several of us three weeks ago in DC to help review a data document they plan to put out to approximately 146 engineering schools next year. Funded by the Sloan Foundation, the purpose of the working group is to help ASEE come up with a survey of engineering schools about student retention, persistence, and graduation. Why? Because we don’t know how well or poorly institutions do retaining and graduating these students. The challenge with engineering schools, as many other schools can equally attest, is determining the retention rates of entering cohorts of students. On an elementary level, this sounds very simple—just count them. But it is more complex than that. For instance, if a student enters engineering at a particular campus, but the campus doesn’t allow students to commit to a particular school or major for the first two years (and we heard of one that doesn’t commit until the fourth year), how do you count first or second year retention in engineering? How do you deal with intra-school transfers (e.g., to and from engineering) in retention. If a student enters engineering but quickly decides to go into business (because engineering is hard!), that student is a negative statistic for the school of engineering. So, do intra-transfers count differently? If a student transfers to another school because they have to be close to home, does that count negatively against the program?

There are countless examples of these variances in cohort retention calculations. So it isn’t as simple as most of us would like to think it is. I haven’t even brought in the issue of variable race/ethnic groups, thanks to the US Census Bureau.

But the fact that we have a difficult time counting students is a serious concern in higher education. We can’t determine quality and efficacy issues if we can’t count students. And institutions that can’t (and sometimes won’t) count students should be put in a special little category of Title IV and not allowed to come out until they figure this out. We need to know—not to punish—but to know. Institutions need to be more accountable about who they serve and how well they serve, and counting is a start.

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