Wednesday, August 26, 2009

HBCUs vs. FPCUs in the Great Recession

A. Context

This blog continues the discussion begun in a previous blog, "HBCUs in the Great Recession" -- a pessimistic glance at the the negative impact of the Great Recession on the future of the colleges and universities that have provided African Americans with their the most significant opportunities for higher education in times past, i.e., the HBCUs.

It presents some recent data about the positive impact of the Great Recession on the future of the colleges and universities that -- if HBCUs maintain their self-limiting focus on traditional programs -- are likely to provide most African Americans with their most significant opportunities for higher education in the future. I speak, of course, of the FPCUs -- the for-profit colleges and universities.

The vast majority of HBCU programs are still directed at traditional college age students who attend face-to-face classes on weekdays. (See the limited offerings listed in the Gateway's Directory of HBCU Programs for Non-traditional Students.)

By contrast, the vast majority of the programs offered by FPCUs focus on non-traditional students, i.e., older students who must attend classes on evenings and weekends or via distance learning because of their jobs and/or family obligations. Such programs are usually called "adult education" or "continuing education."

B. Substantial African American Enrollments in FPCUs

The reader needs to be aware that a substantial and increasing percentage of the students enrolled in the the nation's leading for-profit colleges are African Americans. The Digital Learning Lab called attention to this trend in a report posted on the Gateway to HBCUs three years ago: Strategic Partnerships (2006).

Back in 2005, when the DLL's staff first assembled the enrollment data for business majors and for information systems majors, two of the most important baccalaureate and masters degrees in today's job market, I used to confound my colleagues by projecting the enrollment tables on a screen while covering up the column that contained the names of the colleges and Universities. Then I would ask them to pick out the HBCUs .. and they would invariably include Strayer, DeVry, and Phoenix. ... :-)

The DLL's Strategic Partnerships report concluded that "a number of for-profit institutions have taken on roles traditionally associated with HBCUs as the producers of disproportionately large percentages of African-American graduates." In other words, FPCUs were eating into what should be part of the core market for HBCUs. Given the fact that continuing education, especially programs involving involving distance learning and/or blended learning, is the fastest growing segment of today's higher education market, the HBCU community has voluntarily excluded itself from its strongest potential growth opportunity.

C. FPCUs in the Great Recession

Whereas most HBCUs have been struggling during the the current massive economic downturn, how did the FPCUs perform? The following table, published in the online edition of the Chronicle of Higher Education on Tuesday 26 August 2009, says it all:

How Enrollment Has Boomed at For-Profit Colleges

Enrollment, 2009 Enrollment, 2008 Percent Increase

American Public U. System 53,600 35,900 49%
Apollo Group 420,700 345,300 22%
Bridgepoint Education 45,504 22,607 101%
Capella Education 29,281 23,733 23%
Career Education Corp. 93,100 83,300 12%
Corinthian Colleges 86,088 69,211 24%
DeVry 90,365 74,765 21%
Education Management Corp. 112,700 91,600 23%
ITT Educational Services 69,127 54,793 26%
Kaplan Higher Education 103,300 78,700 31%
Strayer U. 46,038 37,733 22%

Note: All data are for quarter ending June 30, except Apollo Group, whose quarter ends May 31. Some numbers are rounded.
While their performance wasn't quite as spectacular as Goldman Sachs or JP Morgan Chase, the FPCUs listed in this table did very, very well. The Chronicle reported that they not only increased their enrollments by the impressive percentages shown in the table, they also increased their tuition revenues and bottom-line profits by comparable margins. In other words, there's lots of money to be made in continuing education -- even during a record-breaking recession.

D. The Digital Divide As A Surmountable Barrier to Opportunity

There are undoubtedly many reasons why the leading FPCUs were so successful, but one is especially relevant to HBCUs:
  • All of the leading FPCUs make intensive use of information technology (IT) in their administrative operations, in their advisory functions, and in their course delivery systems.
Therefore HBCUs that remain entrenched on the wrong side of the Digital Divide will not become successful participants in the flourishing continuing education market. At this point, information technology is cheap enough to be affordable by most HBCUs. Hence crossing the Divide comes down to hiring competent IT staffs.

Information technology does not configure itself itself. No matter how close it is to the current state-of-the-art, cost-effective IT is always about people. Unfortunately, this obvious "insight" seems to have been missed by the senior administrators of too many HBCUs. Unwilling to hire first-rate (albeit relatively expensive) IT professionals, they try to muddle through with mediocre to inferior, a strategy doomed to costly failure and maddening paradox. A highly talented younger colleague of mine once observed: "The best computer in the world is the one you already have, but aren't using to its full capacity"

  • It takes first-rate IT talent to specify and maintain the most cost-effective administrative and academic IT systems. Such talent needs to be hired, retained, prized, and paid competitive salaries.
  • And then there are the IT users: the faculty and administrative staffs. No matter how "user friendly" the information technology, most people need training and retraining -- preferably by competent IT staff -- to become productive IT users.
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