College-tuition discounts are now the rule rather than the exception. And that’s sent the higher education establishment into a tailspin.
Consider last month’s annual tuition discounting report from the National Association of College and University Business Officers. The report showed that colleges now grant some sort of aid to almost 90 percent of freshmen, an all-time high. (Tuition discounting is a reduction in a college’s listed price that occurs because colleges provide need-based and merit-based financial aid to promote access to higher education and maintain enrollment).
The report invites those who turn up their noses at discounting as if it were a blue light special at Kmart to gnash their teeth and froth at the mouth.
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Predictably, there was panic among those who believe these discount rates are unsustainable. Others were confused about what the report meant. And there were plenty who used the report to attack colleges and universities for the high-price/high-discount business model.
College choices aren’t limitless, but they are plentiful and families would be short-sighted not to hunt down their own terrific deal in higher ed.
What is overlooked in the analysis — though not necessarily the report itself — is that discounting is simply a measure of how much financial aid is needed to enroll the millions of students who are headed to college this year.
The numbers should be celebrated by those who advocate for affordability and access. Consumer behavior is an important consideration and price and affordability are of paramount importance in the decision-making process
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It may seem hard to refrain from joining those who protest that college is becoming a commodity and that the student now shops for a degree the same way that a driver shops for a car. After all who doesn’t want everyone to view higher ed as much more meaningful than automobiles or pork bellies or steel, sought at the lowest price possible? Who doesn’t want to sprint away from the idea of students as customers? And what administrator doesn’t want to take on discounting and the practice of giving away our product at rates that are sometimes lower than our costs to provide it?
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And yet the dialogue against tuition discounting is so full of Pollyanna-like sentiments that its proponents miss the point that families value higher education, and they also increasingly understand that they are in the driver’s seat when it comes to negotiating what they think is best for their children’s career aspirations and pocketbook.
Higher education’s internal, naïve optimism is fodder for those who are angry with boards, presidents, administrators and policy makers, who they believe are abandoning mission and have become too sensitive to student and parent expectation and market condition. And data like the tuition discounting report backstops, to families and elected officials, the notion that we are playing games with price and access.
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If we are honest, we have to acknowledge that higher education and higher ed professionals didn’t create the idea of college as a commodity and the student as a customer seeking the lowest price; students, parents and the market did. Students and families have choices — lots of them — and no college wants to be the passed-up choice.
The report on discounting reinforces that decisions about cost, value and affordability are taking on a new importance in this mix and colleges have done what they always done: responded, changed and adapted. It’s misguided to think we are putting this discussion to rest by simply saying a student is not a customer and college is not a commodity and that discounting alone is unsustainable. There is so much more complexity to these conversations than can be shared in an essay and they deserve more discussion across campuses and in the boardroom.
In The Future of Success, former Labor Secretary Robert Reich describes an “age of the terrific deal,” in which “only the indolent, insane, or congenitally complacent would pass up a product that’s obviously better (and costs more) or cheaper (and of the same quality), an investment with a high return, a more rewarding job, a more comfortable community.”
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As an educator and higher education administrator on the front lines of communicating with prospective students about the value of higher education, I can tell you that Reich’s comments nail down the problems we face and his observations should not be ignored.
The current state of higher education is cultural, economic and natural. College choices aren’t limitless, but they are plentiful and families would be short-sighted not to hunt down their own terrific deal in higher ed. After all, students and their families are the ones paying out of pocket for college, and it’s in their best interest to find the institution that offers the best return on investment. Schools can adapt or willingly place their institutions in peril.
There are still some people who anticipate a return good old days when discount rates were low, students didn’t think and behave as consumers, and higher ed was exempt from economic valuation.
Those people are going to have to wait for a long, long time.
Kent Barnds is executive vice president and vice president, enrollment, communication and planning for Augustana College in Rock Island, Illinois.
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