NCSL Podcasts

Making Higher Education Accountable | OAS Episode 212

Episode Summary

On this episode, we talk with two guests—New Jersey’s secretary of higher education and an NCSL expert who tracks higher education legislation—about the effort by states to enact legislation that holds higher education institutions accountable for the value of their programs.

Episode Notes

Enrollment in higher education has been on the decline for a decade, and research indicates a growing skepticism about the value of higher education. In response, many state legislatures have enacted laws aimed at creating greater accountability in higher education.

To explore the issue, we sat down with Brian Bridges, the secretary of higher education in New Jersey, to discuss legislation passed in that state. A 2021 bill established new requirements for academic programs including sufficient academic quality, evidence of labor market demand, lack of duplication, and requirements for additional state resources. Another bill in 2022 created performance quality standards for career-oriented programs and required the higher education secretary to develop minimum standards for state programs. 

Also on the program is Andrew Smalley, a higher education policy expert at NCSL, who discussed the trend in state legislation and what the statistics tell us about the value of higher education.


Episode Transcription

Ed:      Hello and welcome to “Our American States,” a podcast from the National Conference of State Legislatures. I’m your host, Ed Smith. 


BG:     Higher education is specifically failing in New Jersey as well as nationally for declining enrollment, declining state support, increasing costs and this larger question around the value of a college degree.


Ed:      That was Dr. Brian Bridges, the secretary of higher education in New Jersey and my guest on the podcast. Also on the show is Andrew Smalley, a higher education policy expert at NCSL. The focus of our conversation is accountability and value in higher education. Enrollment in higher education has been on the decline for a decade and research indicates a growing skepticism about the value of higher education. We asked Dr. Bridges to join the podcast because New Jersey has enacted significant legislation to address post-secondary degree and credential quality and higher education accountability. A 2021 bill established new requirements for academic programs including sufficient academic quality, evidence of labor market demand, lack of duplication and requirements for additional state resources. Another bill in 2022 created performance quality standards for career-oriented programs and required the higher education secretary to develop minimum standards for state programs. Dr. Bridges discussed the effects of these laws and other efforts in the state. 


           Smalley explained the trend in state legislation across the nation and also what research tells us about the value proposition for higher education and why it can be a difficult assessment to make.


Here is our discussion starting with Andrew Smalley.


Andrew, welcome back to the podcast.


AS:     Hi Ed. Good to be back.


Ed:      So, we are focusing for this podcast on what is referred to as higher education accountability. This is sort of an umbrella term for some different policies and later in the podcast I’m going to speak with Dr. Bridges about how this applies in New Jersey. But I wonder if we could start with you giving listeners a quick prim around what sort of policies we are talking about.


AS:     Yeah, I think we are really using accountability to frame an important discussion right now in higher education and I think it’s really the response to the idea that more and more Americans do not see college in their future and don’t see college as worth it. So, you know we’ve talked on this podcast before about the growing cost of college and the way students can pay for it and save for it, ways states can fund it. But then there is also the conversation of is all this work and all this action going to actually payoff for students after they graduate which in some ways can be a bit reductive. You know for many students’ college is more than just a simple cost-benefit proposition, but I think it is an important conversation that is happening right now in this space and in this policy field. The Wall Street Journal has done polling for years on if Americans think college is worth the cost of attendance and a decade ago, the majority of people said yes and then last year for the first time ever a majority said no and only 42% of those surveyed thought that a four-year degree was worth it. So, there’s definitely been a shift here. It’s recent and it has big implications for higher ed especially as the system enters a period where we widely expect declining enrollments due to lower birth rates and we continue to see affordability challenges. So, I think as we talk about policies here, we are homing in on the idea that state legislatures play a massive role in their state’s talent development system. They care a lot of that education and workforce development and they want their colleges and universities to be aligned with that mission in delivering programs that provide a return on investment, sort of however that is defined. 


Ed:      Andrew, one of the things you do at NCSL is track this legislation. I wonder what kinds of trends you see in terms of legislation that falls under this accountability area.


AS:     Yeah. So, this area is so fundamental to the higher education system. There is sort of a lot of different ways states have addressed these challenges. I think first we’ve seen a lot of states more explicitly focused on value and accountability for their higher education system. So, Colorado passed legislation that requires the state Department of Higher Ed to publish an annual ROI report on undergraduate degree and significant programs. They have to look at things like the price of these programs, the debt that comes with these programs and then the value that it provides on both the public and a personal basis and they’ve done work in subsequent years around data systems and making sure that their agencies are working to measure sort of the value of their programs and the degrees offered. And then there has also been a wide range of state efforts to you know address specific targeted workforce needs. This really runs the gamut. Texas has done work on incentive for cybersecurity. Virginia has a program for CTE teachers. Kentucky has done work on healthcare workforce. This is broadly you know the field of taking financial aid policy and aligning it with your state’s workforce goals. And then I’d say the last big area we’ve seen is that there has been a real push to provide students and families with better information about their post-secondary education options. There is a real sense and backed up by data that a lot of folks navigate this system somewhat blindly. We know from survey data that about a third of students don’t know if their major even aligns with their career goals and we know that course options, financial aid system, student loan terms – all these things are complex at best and program dysfunctional at worse so there is a huge barrier for a lot of students here. So, we know states have passed right to know legislation designed to help you know give students and families information requiring disclosures about the cost of programs, about what financial aid is available, about average debt levels and workforce outcomes. You know these are bills that generally require this information to be published on a website although I think the extent to which these tools and others such as college score card are being used is probably worth something considering. But this is really an extension of sort of the state role and consumer protection in higher education.


Ed:      I suppose we shouldn’t be surprised that people find this process confusing since families probably only do this a few times in their lives. But let me ask you a more fundamental question about the value of higher education. You noted earlier the skepticism about the value of higher ed or post-secondary education. How do you explain the value proposition? 


AS:     Yeah. So, there are a lot of different ways to look at this question. If you sort of take the topline averages, average high school graduate makes about $44,000 a year. The average college graduate makes about $74,000 a year. The data is clear that the higher level of education you have, the less likely you are to be unemployed and the more money you are going to make over the course of your career. But there are, of course, exceptions to that and when you get into the value conversation, you are really getting at does the student make enough money back and earn more over their lifetime to justify the cost and the time of that degree. So, a lot of different ways to calculate. A lot of different folks have looked at this with different estimates and different data. Just a few general points from what we’ve sort of seen in the research is the best data suggests that about 75%, 80% of students who earn a bachelor’s degree will recoup the net cost of that degree over their lifetime. Associate’s degrees are maybe a little bit lower about 65 to 70% but in general these degrees do pay off. More than half of them pay off quite quickly within five years of graduation. The timeframe component is interesting as we start to talk about more non degree offerings, certificates, credentials where their terms can be a little more varied over the long run, but often provide a noticeable bump in sort of the short term. And then of course obviously there is great emphasis and no surprise to anyone, the degree itself matters. There is wide variation between engineering students and say dance or theater students. But again, that’s just looking at averages. And then the last sort of distinction is to look at institution types. So public colleges, the state flagships, the community colleges and non-profit private schools fair pretty well. Only about 10% of programs at those institutions don’t provide a return on an investment for students. When you look at for profit colleges, some estimates show about 40% of those programs don’t pay off. So, for you know our state legislative audience, students enrolled at public colleges and universities or private nonprofits, the data would suggest that the majority of those students are getting a degree or credential that will allow them to recoup what they spent to attain.


Ed:      As we wrap up, I wanted to ask you about these trouble spots in higher education that you mentioned. Things such as students not completing their programs or programs that offer less of a return than students thought. Are there things that states can door are doing about these problems?


           TM:  10:10


AS:     Yeah. So, starting on the completion side of the issue, that’s been a really intense focus for secondary policy work for many years and there’s been a wide range of options that states have done to work on this from modifying funding formulas to providing students with additional supports to address costs beyond tuition. It is worth noting though that despite this focus nationally, completion rates have been pretty flat for the past half decade. So certainly, I think a lot of work to be done in that space. And then of course states have that major role overseeing public institutions where the majority of students attend. But there is also a focus on the for-profit institutions, several states including Maine, Illinois, Tennessee have passed legislation related to oversight and governments at these for profit and proprietary institutions. You will hear more about New Jersey’s work and some of their gainful employment standards they are rolling out for their career preparation programs. And I think you know the key thing there is states are looking for ways to promote programs that provide that return on investment for students and incentivize institutions to invest in these programs at public colleges. I think the last point I would say is that overall, in both public and private, we all see headlines about college closures and mergers and I will think we will continue to see that in coming years. This is an important issue that I think states will continue to face as overall enrollment is down over 10% in the last decade. There’s going to be additional slowing of the number of high school graduates due to birth rates. A lot of federal aid that came during the pandemic is now drying up. You know this year about one university or college is closing every week and this is serious because we know that less than 1 in 5 students who attend an institution that closes will actually go on to earn a degree or certificate. So, this is a huge derailer for students and there’s a lot of states can consider around financial monitoring, mergers, consolidations and closure procedures should an institution close. And states are really considering how to think about those challenges and what they can do to support students earning their credential or degree from those institutions. 


Ed:      Well Andrew, I think we got a couple more podcasts there so I think I’ll be coming back to you to discuss this. Hey, thanks so much for taking the time to fill us in on this. Take care.


AS:     Yeah. You too Ed.


Ed:      I’ll be right back after this break with Dr. Brian Bridges from New Jersey.


           TM:  13:03


           Dr. Bridges, welcome to the podcast. You’ve been Secretary of Education there in New Jersey since 2020 and these have not been the easiest 4 years in higher education in this country. I wonder if you could give us kind of that big picture notion of what you see as the challenges in post-secondary education in New Jersey of course, but also around the nation.


BB:     Sure Ed. Thank you for that question. It certainly hasn’t been an easy time in higher education. We are feeling many of the same challenges that the rest of our society is feeling. But higher education is specifically failing in New Jersey as well as nationally, declining enrollment, declining state support, increasing costs. And this larger question around the value of a college degree. I think a lot of that is related to costs. I think costs is driving a lot of the questions around the value proposition of higher education and the return investment whether it is still worth it. But I do think that New Jersey is feeling that as well. There is a reckoning coming for New Jersey somewhere down the road because over the last several, probably three decades now, during this administration, we’ve invested heavily in higher education and actually have invested more than the previous three or four governors combined. But from ’94 until about 2018, higher-ed funding was flat which amounted to a decrease for the state and so we are at a critical inflection point and it’s important for our sector to encourage motivation and forth thinking practices. I think the big issues are around the value proposition and whether or not higher education is still worth it. And I think that directly is connected back to cost.


Ed:      Boy that’s certainly the conversation I think you hear among people who aren’t in education, but just have kids who are going to at that age and that sort off thing so that certainly seems to be right on the money. Talking about specifically New Jersey, what’s the state done to address these challenges you just laid out and specifically helping these young people get degrees that are going to be useful to them in terms of being able to make a living and giving them a credential that is worthwhile.


BB:     We’ve done a lot over the last I’ve been in this role for 3½ years now and we’ve done quite a bit. When the cost for instance I just previously talked about cost, we worked diligently to make college more affordable. That has been a central platform of Governor Murphy’s. We’ve invested heavily in student financial aid. In fact, we are now number 2 in the nation as far as average aid per student by state. We’ve created a college promise program. We’ve invested more in our state tuition aid grants. And we actually have evidence that looking back over the last 6 years, the net price that students pay to attend college has actually decreased. So, we’ve made college more affordable, but some of the other things that we’ve done to try to help students earn their degrees is to talk more intentionally about our workforce partnerships and trying to engage more of the workforce into our college and universities and have them interact with each other so that colleges and universities have a clear expectation and understanding of what the workforce and our employers expect of college educated graduates. So, we’ve been more intentional about doing that working closer in our economic development authority and our institutions. And we’ve also done things to try to strengthen our education enterprise in New Jersey by making our institutions a little bit more accountable so that the investments that families and students make in higher education are reasonable and protected unlike many other northeastern states, we’ve not had a host of institutions close. In New Jersey, we are trying to be as diligent as we possibly can about making sure that we provide appropriate oversight to the enterprise, higher education enterprise so that we can protect our students and families.


Ed:      Can you talk a little bit about New Jersey’s gainful employment standards and how they should help people get good jobs.


           TM:  18:29


BB:     That’s a great question because in 2022, Governor Murphy signed out gainful employment standards into law. And what the law does is it sets standards based on a ratio of the program’s tuition compared to the typical earnings of this specific kind of identifiable occupation for which the program is designed to prepare students for. In our office along with the New Jersey Department of Labor will enforce those quality performance standards as appropriate for career oriented post-secondary education and the Department of Labor will do that for training programs at any institution licensed or approved by the state. So, this protects students from incurring unsustainable debt in education and training programs. The poster child for this was there was I believe Wall Street Journal article from a few years ago there is a student who paid I think something like $150,000 from a private institution to get a master’s of social work. Now if you know anything about the social work profession, a good job hosts a Masters, the person might earn $50 to $60,000 a year. So, we think that having to pay three times for a degree, but a person will earn it in their annual salary for that job, that’s not fair to students and their families. So, this is a law that people have been very interested in across the country. When we presented on this at the state higher education executive officer’s conference a couple of years ago, there was standing room only. Everyone was very interested in this. We are currently in the open comment period for regulation so there’s more to come here. We are in the process of trying to implement the law and create regulations to implement it fully. We believe that this basically protects families and students from undue debt burdens in their pursuit of their educational trainings. 


Ed:      Well, we certainly think a lot of state legislators are going to be interested in what you are doing there in New Jersey and that’s why we are so happy to have you on today. I wonder if you could talk about beyond the gainful employment standards, what other things are you doing in New Jersey around employment and that sort of thing?


BB:     What set the stage for that law and all the work that we’ve done subsequently over the last few years, there was a legislation in 2021 that increased my office’s authority over academic program review process because most of our program approval functions are housed within the New Jersey President’s Council which is a statutorily created body that consists of the majority of college presidents in the state. Now with the 2021 law, the secretary has final approvement on proposed academic programs if the President’s Council deem the program to be unduly expensive or duplicative or if the program exceeds the programmatic mission of the institution. Now the new process requires institutions to demonstrate if the new program has sufficient academic quality whether there’s evidence of labor market demand for the program. Whether it is duplicative and whether it will require significant state resources. So, what the law really allows us to do is to be able to drill down and make sure that we are not creating program that aren’t truly aligned with the needs of the state, the economic needs of the state and the training needs of the state. So, it allows us to focus, it allows us and the institutions to focus their efforts more squarely on those in demand programs and help students be better prepared for them rather than creating programs of every new kind of trend that’s out there, but it allows institutions to create programs that are directly aligned with the demands and needs of New Jersey’s economic workforce.


Ed:      Let me switch over to what you mentioned earlier the notion of colleges closing which of course can be a real nightmare for students. It sounds like you’ve done pretty well in New Jersey with that, but we know around the country I’ve heard a number of news stories recently about this. What did New Jersey do to try to prevent these closures from happening and what should be done for students who are affected in that kind of situation? 


           TM:  22:40


BB:     Great question. During Governor Murphy’s administration over the last six years, New Jersey’s overall interest in higher education and safeguarding students and family’s investment has increased exponentially. So, one of the key things that we’ve done there’s legislation that enabled our office to conduct physical monitoring of independent and proprietary institutions that law passed I think in 2021 so it allows us to develop a process to collect relevant financial information from the independent sector. That law was passed in 2021. We collect a whole host of financial matrix such as composite financial index scores and trends in cast, investments and debt covenants and debt burdens and we collect this data annually. Last year a piece of legislation was passed that saw similar financial accountability legislation become law for public institutions and we are actually in the process this year of collecting that data for the public for the first time which allows us to have a better understanding of the financial picture of the institutions and to be able to get ahead to determine conditions that might exist that would negatively impact institutions operations. The law also allows our office to appoint a state monitor to provide direct oversight of a public institution’s physical and governance operations. The law also creates training requirements for chief financial officers. And so, what it does, it allows our office to basically wrap our arms a little bit more around the financial status specifically about public institutions, but also to have a better understanding of what’s happening in the private sector because that’s where most of the closures are happening. It allows us to be better prepared as a state for financial distress at our institutions and the resulting impact on the students who attend them. So, we’ve been working diligently with the institutions. You know this isn’t necessarily something that institutions are clammering for, but it allows us to as a state have a better understanding of what’s needed to continue with creative thriving higher education enterprise more than anything else for the students who attend those institutions. 


           TM:  25:01


Ed:      Well, I have to tell you having done scores and scores of public policy podcasts, I can’t tell you how many times collecting good data and analyzing it comes up as a key to trying to deal with all kinds of problems and it sounds like you’re doing exactly that there in New Jersey. As we wrap up, I just wonder if you have any advice for your colleagues around the country, for state legislators, legislative staff who are interested in this and what you are doing in New Jersey and the success you’ve had.


BB:     Sure. I mean we’re happy to connect with any other state that is interested in learning more about this work. Actually, I have a call later on today with contemporaries of mine, my counterparts in some other states to talk about the various work going on not just in New Jersey, but across the country because we learn from each other and understand how to advance our work. We communicate a lot with other states. We do a lot of research on what other states as well as what the federal government is doing and we do more than anything else try to talk to the people on the ground. We have a really good relationship with our institutions so that they can inform us of the needs that help them be more affective. We do a lot of what we call stakeholdering to make sure that we have all the information that we need to address the challenges for institutions as well as for students that benefit the state at large. And so, I would say we are happy to talk more about our work whether it’s the gainful employment standards. Whether it’s the data reports that we provide. Whether it’s our efforts to reduce costs for our students and their families. We are more than happy to dialogue with anyone about the work taking place here in New Jersey to leave higher education in the Garden State better than we found it.


Ed:      Well Dr. Bridges, thank you so much for taking the time to share what’s going in New Jersey. I think people will find it very interesting and helpful. Take care.


BB:     Thank you. You do the same.


Ed:      I’ve been taking with Dr. Brian Bridges, Secretary of Higher Education in New Jersey and Andrew Smalley from NCSL about state efforts to ensure students are getting value from higher education. We also want to thank the Stand Together Trust for its support of this episode.Thanks for listening.


           TM:  27:13


You can check out all the podcasts from the National Conference of State Legislatures by searching for NCSL podcasts wherever you get your podcasts. This podcast “Our American States” dives into some of the most challenging public policy issues facing legislators. On “Across the Aisle” host Kelley Griffin tells stories of bipartisanship. Also check out our special series “Building Democracy” on the history of legislatures.