Archive for July, 2015

July 24, 2015

College student retention services ‘is a hot business’

by Grace

Copley Retention Services is one of several companies that offers offers technology-based systems intended to keep students on track to graduate on time from college.  It uses “a combination of over 20 data points to flag students who may be at risk of dropping out”.

One in three college freshmen don’t return for their sophomore year. It’s a sombering statistic not just for students, but also for universities that miss out on tuition dollars.

Student retention services appears to be a growing field.

Forecasting student success is a hot business, and the industry has seen major consolidations this year. In February, Starfish Retention Solutions and GradesFirst have been acquired, respectively, by Hobsons and Education Advisory Board, two companies trying to move the needle on college completion rates. Earlier this week, Uversity was bought by TargetX, both of which provide data analytics to help colleges boost student recruitment and retention. Learning management systems like Desire2Learn also boast their own student success tools.

This need is also increasingly felt at the K-12 level, with startups like LearnSprout building early warning systems that tap into student information systems for signs that can help elementary and high school students stay on track.

Mark Cuban, owner of the NBA’s Dallas Mavericks, has partnered with other parties to invest $1.5 million in Copley.  He explains how colleges benefit from retention services.

Copley makes higher education more efficient. It is expensive to lose students or have them drag on their education over an extended period. Copley is the leader in helping schools address the needs of at-risk students. That is money in the bank for the school.

Of course, students benefit also.

If we can get more at-risk kids to graduate in four years or less, all while not over-taxing the support services of the school, tuition may have a slight chance of staying flat or going down.

But for many “at-risk kids”, all the tracking and remedial efforts may not be enough if they lack family support as well as the fundamental competencies that should have been taught in K-12.  It remains to be seen if these retention services are able to make a dent in the college drop-out problem.  However, if these services are funded by taxpayer dollars I don’t put much faith in how carefully their efficacy will be assessed.

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Tony Wan, “Copley Retention Systems Raises $1.5M From Mark Cuban, USA Funds to Boost Student Success”, edSurge, Jul 10, 2015.

Tony Wan, “5 Questions With Mark Cuban on Higher Education and His Newest Edtech Investment”, edSurge, Jul 17, 2015.

July 15, 2015

Duke is one of only two top-ten universities to offer merit aid

by Grace

Duke is one of only two top-ten universities to offer merit scholarships.

… Though some critics of merit aid programs say the scholarships can take resources away from students who need financial help most, University administrators say this is not the case for Duke. The University maintains eight merit scholarship programs while also growing the amount that is given to students with financial need, according to Melissa Maouf, director of the Office of Undergraduate Scholars & Fellows.

“Our merit communities are a mixed bag, economically all over the place,” Malouf, wrote in an email Wednesday. “All students to apply to Duke may be considered for a merit scholarship—rich or poor or in between.

Only three Duke scholarships are solely merit-based.

Three of the eight scholarship programs Duke offers—the Angier B. Duke Scholarship, the Benjamin N. Duke Scholarship and the Robertson Scholarship—solely take merit into account. The remaining five scholarship programs consider a mixture of merit and need.

Nearly 4% of Duke students receive merit aid.

In 2013, Duke provided merit scholarships averaging about $56,000 per year to 314 students, nearly 4 percent of the undergraduate body, according to the 2013-14 CDS survey.

Only one other top-ten school, the University of Chicago, also offers merit awards.  All the other schools only give need-based financial aid.

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Jenna Zhang, “Duke stands alone among peers in merit-based scholarship priorities”, The Chronicle, January 20, 2015.

 

July 8, 2015

Should Parent PLUS loans generate billions in profits?

by Grace

The US government’s predatory-lending program
America earns $3 billion a year charging strapped college parents above-market interest. “It’s like ‘The Sopranos,’ except it’s the government.”

The fast-growing federal program known as Parent PLUS now serves 3.2 million borrowers, who have racked up $65 billion in debt helping their kids go to school. The loans have much in common with the regular student loans that have created a national debt crisis and a 2016 campaign issue, but PLUS has much higher interest rates and fees, and far fewer opportunities for loan forgiveness or reductions.

Should student loans generate profits for the federal government?

In fact, the PLUS program, which includes similar loans to graduate students, is the most profitable of the 120 or so federal lending programs. That sounds like a good thing, until you remember the government’s profit comes from its own citizens, often citizens of modest means.

Student loans enhance accessibility, but at what cost?

… PLUS loans have also become a key revenue source for many schools, particularly historically black colleges and for-profits that tend to serve lower-income families.

But that just illustrates the increasingly tortured economic paradoxes at the heart of modern higher education, where schools have no incentive to provide affordable prices as long as they can count on federal dollars for making education affordable. Ultimately, Parent PLUS sluices more cash into the college-industrial complex, helping educators jack up their tuitions while pressuring parents to make up the difference with debt, while doing nothing to ensure they’re getting a real return on their investment. It enhances accessibility, but not really affordability, simply giving parents a way to punt the skyrocketing costs into the future.

Underwriting standards are lax, and the government lends money to “people with no clue if they can pay it back”.

Many critics argue that Parent PLUS should be abolished, and that the government should expand Pell grants and raise caps on student loans instead. But even those who want to continue the program — including Rodriguez in the White House and Republican staffers on Capitol Hill — seem to agree there are relatively obvious ways to strengthen it. The most evident would be real underwriting standards to evaluate the ability to pay of potential borrowers. Another would be strict loan caps. Or a combination of those reforms could link the creditworthiness of borrowers to the size of the loans they’re eligible to receive, the kind of calculation real banks make. Even Draeger, who represents aid administrators at 3,000 colleges and universities, said the system needs structural changes to protect vulnerable families.

A parent’s comment in a CollegeConfidential thread illustrates part of the problem.

My main concern with the Parent Plus loan is the lack of consumer disclosures regarding future pymts and the cost of credit – there are none. I borrowed $24,000 this week – it took about 5 minutes – with no evaluation of my qualification to repay – and no disclosure to me of what my future pymts will be. I can see very easily how someone could get in over their head.

The major challenge to reforming the Parent PLUS program is its “immense profitability”.

… These days, the government borrows money at almost no cost, so lending at 7 percent plus fees can add up: Parent PLUS could reduce the deficit by $3 billion this year. That means any effort to scale it back and restrict it to creditworthy borrowers would cost the government a lot of money….

July 2, 2015

Teen employment rate continues to decline

by Grace

Teen summer employment has been in steady decline since the 1970s.

20150701.COCDecliningTeenEmployment

To understand what’s happened to the Great American Summer Job, we looked at the average employment rate for 16- to 19-year-olds for June, July and August (teen employment typically peaks in July of each year). Since 1948, which is as far back as the data go, through subsequent decades, teen summer employment followed a fairly regular pattern: rising during economic good times and falling during and after recessions, but generally fluctuating between 46% (the low, in 1963) and 58% (the peak, in 1978).

That pattern began to change after the 1990-91 recession, when the teen summer employment rate barely rebounded. Teen summer employment again fell sharply after the 2001 recession and again failed to rebound, and fell even more sharply during and after the Great Recession of 2007-09. After bottoming out in 2010 and 2011 at 29.6%, the teen summer employment rate has barely budged – it was 31.6% last summer.

For younger teens, the summer-jobs picture is especially bleak. Last year’s summer employment rate for 16- to 17-year-olds was 20%, less than half its level as recently as 2000. For 18- and 19-year-olds, the summer employment rate last year was 43.6%, still well below the 62.6% average rate in the summer of 2000.

Why the decline?

… Researchers have advanced multiple explanations for why fewer young people are finding jobs: fewer low-skill, entry-level jobs than in decades past; more schools restarting before Labor Day; more students enrolled in high school or college over the summer; more teens doing unpaid community service work as part of their graduation requirements or to burnish their college applications; and more students taking unpaid internships, which the Bureau of Labor Statistics does not consider being employed.

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Drew DeSilver, “The fading of the teen summer job”, Pew Research, June 23, 2015.

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