New thinking, new approaches needed to transform higher ed, Callan says

In order to meet the challenges of the 21st century, American higher education must redesign itself through a fundamental transformation in policy, practice and financing. But in doing so, it can neither expect nor rely upon a restoration of past approaches or public support. That was the central message delivered by Patrick M. Callan, president of the Higher Education Policy Institute and the featured speaker at the Bell Policy Center's "Voices of Opportunity" program on Dec. 7.

Callan, one of the nation's leading voices on higher education policy and financing issues, noted that three key social and economic forces are driving a "crisis of the old order" in American higher education.

First, the knowledge-based global economy in which we now compete requires higher levels of educational attainment. In the decades following World War II, earning family-sustaining wages was possible with just a high school diploma, but that economy and those opportunities no longer exist. Today, some level of post-secondary education beyond high school is necessary in order to attain and stay in the middle class. And for the United States to stay competitive globally, our system of higher education must educate more people than we currently reach and serve them better so that they complete their certificates and degrees.

Second, a powerful change in demographics is taking place. As baby boomers, the nation's most educated generation, reach retirement age, the younger people who must take their places are increasingly from minority and low-income populations. Traditionally, those groups have not been well served by our P-12 and post-secondary education systems. America's investment in higher education for the G.I. and baby boomer generations was a significant factor in our economic success. But without a transformation of higher education (and P-12 education) to meet the needs of this new generation, we will not keep pace with nations that have been making significant investments in raising the educational attainment of their young people.

Third, the economic downturn and related fiscal pressures being felt across the nation have highlighted the need for a transformation in higher education policy and practice. But while current budgetary shortfalls have accelerated the need for transformative change, the recession did not cause higher education's fiscal crisis, Callan asserted. Rather, the "fault lines" in the system were already present, in part, as the result of an unsustainable financing model that relies on tuition increases as the primary means to offset shrinking state appropriations. This model simply shifts more of the post-secondary cost burden onto students and their families.

Callan identified several important dimensions in the 21st century transformation he envisions:

• Higher education institutions must develop innovative practices to increase productivity and performance without reducing quality. These new approaches must address both the changing demographics of traditional-age students and the needs of working-age adult students, whose post-secondary education opportunities are critical to our increased global competitiveness and a better-educated citizenry. Importantly, though, Callan said that while he believes increased public investments are needed in higher education, institutions cannot wait for additional funding before making changes. Most of the money for such improvements, he said, is "already in the system." Once the transformation is under way, improved public opinion of – and support for – higher education will follow.
• Institutions and states must transform their policies to make increased post-secondary educational attainment a reality. Key in this area are policies that keep college affordable for low- and middle-income students and families. Callan said that, particularly given the changing demographics, the old tuition-driven model of higher education funding and the growing reliance on student debt – especially among the middle class – is no longer viable. In this regard, he noted the importance of a strong state-funded, need-based financial-aid program that assists both traditional and adult students. Callan also said that – contrary to the popular wisdom that the state's role should diminish with dwindling higher education appropriations – he believes that the role of the state is critical to ensuring that scarce resources are used as incentives and invested strategically to achieve the state's broad higher education goals.
• As a society, we must transform the way we think about a "college education." Too often, Callan said, people equate the words "college" and "post-secondary education" with a four-year bachelor's degree. What is needed is an awareness that post-secondary educational attainment also includes many important and viable options, such as one-year certificates and two-year associate's degrees that can lead to employment in well-paying "middle-skills" jobs and serve as the springboard to further undergraduate and graduate degree attainment. Middle-skill jobs require some education and training beyond high school but less than a four-year degree.

None of this will be easy, Callan concluded, but higher education in the United States has always been resilient and adaptable. With the number of innovative thinkers in the higher education community, and with the need for post-secondary education the highest that it has ever been, there is no reason to believe that a 21st century transformation cannot be accomplished.

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Four short videos of Callan addressing college affordability, college completion, opportunities for working-age adult students and new approaches to higher education financing can be found on the Bell Policy Center's website. Click here.