The US higher education bubble and the prospects of transformational change
My friend Larry Medina sent me a link today to Mark Cuban’s latest blog post entitled The Coming Meltdown in College Education & Why The Economy Won’t Get Better Any Time Soon. This is the latest in growing list of commentaries on the subject going back a couple of years now. There are cool infographics on the issue (see here, for example), and even a wikipedia entry, testimony, perhaps, to the seriousness with which this matter is being treated. Cuban — for his part — certainly doesn’t pull any punches. Take this segment for example:
At some point potential students will realize that they can’t flip their student loans for a job in 4 years. In fact they will realize that college may be the option for fun and entertainment, but not for education. Prices for traditional higher education will skyrocket so high over the next several years that potential students will start to make their way to non accredited institutions.
While colleges and universities are building new buildings for the english , social sciences and business schools, new high end, un-accredited, BRANDED schools are popping up that will offer better educations for far, far less and create better job opportunities.
As an employer I want the best prepared and qualified employees. I could[n’t] care less if the source of their education was accredited by a bunch of old men and women who think they know what is best for the world. I want people who can do the job. I want the best and brightest. Not a piece of paper.
The competition from new forms of education is starting to appear. Particularly in the tech world. Online and physical classrooms are popping up everywhere. They respond to needs in the market. They work with local businesses to tailor the education to corporate needs. In essence assuring those who excel that they will get a job. All for far far less money than traditional schools.
As I have written elsewhere in this blog (e.g. here, here and here), it is just a matter of time before the disruptive innovation — a minor irritant to the established players at this point — gives way to a major transformation. It will happen in the United States first (as these things usually do), catalysed by the unsustainable financing of higher education; the scale of which is still not widely appreciated.
What I find really interesting, though, is the question as to how the rest of the world will respond. In Australia, for example, the Higher Education Contribution Scheme (HECS) has contributed to a much more stable environment and student debt is not such a big issue. Will disruptive innovation be as readily embraced here in the absence of a crisis?
I would suggest that in an increasingly globalised and highly connected world, the prospect of ‘contagion’ is actually quite high.