The Pupil Cliff

The United States has hit peak high-school graduate, at least for now.

It has certainly passed peak non-Hispanic white high-school graduate.

After about two decades of steady growth in the number of graduates, the country likely peaked at about 3.4 million graduates in 2011 and will see a modest decline over the next few years, according to a report released Thursday by the Western Interstate Commission on Higher Education. According to the report, the number of graduates will fall in the immediate term, settle at about 3.3 million graduates a year by 2014 and begin to grow gradually starting in 2020, but at nowhere near the rate seen from 1990 to 2011.

“The growth agenda is essentially over,” said David Longanecker, the commission’s president, at a panel presentation in Washington on Thursday, noting that the demographic change will force states and institutions to rethink how they do business, putting a greater emphasis on recruitment, retention, and serving new segments of the population.

The overall decline is driven by a decline in the total number of white students expected to graduate high school, which the report projects to decline by 13 percent between 2008-09 and 2024-25, largely because of declining birthrates. But that trend masks a huge increase in the number of Hispanic and Asian-American/Pacific Islander students. Given the country’s historic challenge enrolling and educating minority students in higher education institutions, the shift will likely require a rethinking of how colleges do business.

“How do we use this data to compel action? We always talk about these trends in terms of natural disasters – a tsunami of students, a cliff – but we’re not doing a damn thing about it,” said Deborah A. Santiago, co-founder and vice president for policy and research at Excelencia in Education, a Washington-based nonprofit that advocates for improved educational outcomes for students, particularly Latino students, at a panel discussion about the report Thursday.

The overall trend also obscures deep regional and state differences, particularly between states in the Northeast and Midwest, which will see overall declines, and those in the South and West, which will see increased numbers of graduates.

For those states likely to see growth, the demographic shift could put pressure on states and institutions to increase capacity, find alternative means of meeting demand or risk freezing large segments of the population out of higher education. For those expected to see declines, it will mean increased competition over traditional students, hard questions about meeting the demands of new groups of students – such as out-of-state and nontraditional students – and potentially closing campuses in state systems.

The report’s findings do not necessarily indicate a drop-off in the number of college-going students. Despite the decline, there is increased emphasis at the state and national level on increasing the number of students who complete high school and enroll in and complete college, including nontraditional students such as displaced workers and adult students who need to finish degrees. But many students who are the target of such efforts lack the money or good high-school preparation that colleges have counted on for past generations of students.

The commission even draws parallels with its first report in 1979, which predicted declines in the number of college graduates as the baby boom generation began to finish college. But enrollments actually increased as states made efforts to enroll a higher proportion of high-school graduates. “More and more students sought access to higher education, which required thoughtful planning, informed by reasonably accurate forecasts, in order to ensure that sufficient capacity existed to meet growing demand,” the report states.

“In today’s economy there is little doubt that a  higher education offers virtually the only path to a middle-class lifestyle, now and in the years to come,” the report says, citing a study that found that the share of the population believing that higher education was necessary for success rose from 31 percent to 55 percent between 2000 and 2009.

Finally Forcing Action?

While the state-by-state differences and overall decline are notable, panelists said, the biggest challenge highlighted by the projections is the rise in the number of minority students, particularly Hispanic students, who often are poorly served by higher education.

Such students often enroll in and complete higher education at lower rates than their peers. They also often confront more financial challenges.

“Our track record nationally in serving underrepresented population has been wanting, resulting in persistent gaps in educational attainment. The nation and individual states have been able to sidestep the need to do better because the economic consequences of not closing those gaps have not been particularly dire,” the report states. “The U.S. can no longer afford to tolerate the wide attainment gaps that are its historical legacy in an age when innovation is driven in part by diversity. The ongoing, rapid diversification our projections portend will, ideally, cause policymakers, institutional leaders, and practitioners to recognize that the status quo is no longer sustainable.”

Hispanic students are likely to grow as a share of high-school graduates from 14 percent in 2008-09 to 22 percent in 2027-28. The report predicts that, nationwide, the number of high-school graduates will be close to being majority minority by the end of its projections. Brian T. Prescott, director of policy research with the commission and one of the report’s main authors, noted that graduating classes in a number of Southern and Western states will likely be majority minority by the end of the projection, with the graduating classes in some states, including Texas and New Mexico, majority Hispanic.

At the presentation Thursday, panelists noted that the demographic transition could finally focus policymakers’ attention on serving these students. “Those students are going to start looking much more attractive because that’s all there is,” Longanecker said.

Two Different Worlds

While all regions will see some short-term decline in new high-school graduates, the long-term projections across states express two very different stories, with the Northeast and Midwest seeing declines and the South and West experiencing increases.

In fact, in the Northeast and Midwest regions, which encompass 19 states, only New York, Kansas and Nebraska are slated to see any growth in the number of high-school graduates, with very little of that coming before 2020.

Maine is one state that is projected to see a significant decline in the number of high-school graduates. According to the report, the state likely peaked in 2007-08 with 17,044 graduates and will decline to 12,849 by 2027-08, a decline of about 25 percent.

“In some respects, it’s the most intractable problem we’re going to see,” said James H. Page, chancellor of the University of Maine system, which oversees the state’s seven public universities.  “We can’t just bring 20,000 new 18-year-olds to the state.”

Despite that decline, however, Page said the system is hoping not to see a decline in overall enrollments. Instead, he said, the system is ramping up efforts to increase the college-going rate among graduates, improve retention, and reach out to individuals who need to complete degrees.  

“We’re not looking to shrink and fit, but we want to evolve who we serve,” he said. “It’s the profile of our typical student that’s going to change,” he said.

The system is also striking partnerships with state-based businesses, hoping to run job-training, professional development, and retraining programs for partners.

At the other end of the spectrum is Utah, which is slated to see a roughly 40 percent increase in the number of high school-graduates by 2024-25. While some of that growth will be among Hispanics, the state also has a growing white population, making it somewhat unusual.

“In some ways, this is nothing new,” said David Buhler, the state’s commissioner of higher education. “We’ve been a high-growth state for a long time. We’re usually first in nation in birth rate. We have a lot of young people in Utah.”

The obvious challenge the state faces, Buhler said, is increasing the system’s capacity to meet the higher number of potential students. And it must do so at a low cost, he said. Because of the high birthrate, the state has a high dependency ratio – the number of children and retired citizens to the number of tax-paying workers.

Instead of building new colleges to meet growing demand, which many states did in the 20th century, the state is trying to increase the capacity of its existing institutions. It has converted some community colleges to four-year institutions and added capacity to other universities. Buhler also said the universities are also trying to operate more efficiently by growing summer school enrollment, holding courses on Saturday, experimenting with online and hybrid courses, and better-scheduling classes. “We have to be like airlines in filling these seats,” he joked.

He said one challenge the state is facing is ensuring that students who graduate high school enroll in and complete high school. With a growing population, there is always a student to take the place of a dropout, so the state doesn’t have the same financial imperative of some shrinking states.  

Buhler also shrugged off the suggestion of taking advantage of open capacity in other states – places like Maine – to serve its growing population. “We want to be able to have a young workforce,” he said. “We don’t want to be exporting out students. Many of them have strong family ties in Utah and would like to stay here for college.”

Colorado is in a similar situation. It is expected to see consistent growth throughout the commission’s projections, with about 20 percent more high school graduates in 2024-25 than it had in 2008-09.

While a high percentage of the state’s residents have college degrees, said Matt Gianneschi, deputy executive director of the Colorado Department of Higher Education, many of those individuals moved to Colorado after getting educated elsewhere. So educating the growing youth population is somewhat of a new challenge for the state.

Like in Utah, increasing capacity at existing institutions has been the dominant strategy, rather than trying to build new colleges and universities. The state is also taking various steps to ensure that the state’s growing Hispanic population will be prepared for college.

New Policies

Panelists agreed that the demographic changes will require new policies, particularly at the state level, to line up institutions with new demands. Policies about tuition, pricing, financial aid and preparation will all be important, they said.

Jane Wellman, executive director of the National Association of System Heads, said the slowdown in many states provides a new opportunity to line up financing policies with enrollment goals and address overlooked areas, such as recruitment and retention. “There has always another kid to take someone’s place,” she said.

Wellman also noted that performance funding initiatives, which are now in place in a majority of states and will likely be a topic of discussion in many state legislatures over the next few years, have the potential to address attainment goals if well-designed. “They ensure that state lawmakers and institutions are on the same page about what matters,” she said. She also noted such policies tend to focus attention on numbers.

New Pipelines

The report notes, but does not explore, a shift in the composition of entering college students. The National Center for Education Statistics projects that enrollments of students 25 and older will likely grow by 20 percent between 2009 and 2020, when they will make up 42 percent of all college students.

One other interesting note in the report is a significant decline projected in the number of students attending nonpublic high schools. The report estimates that the number of nonpublic high-school graduates peaked in 2007-08 at about 314,000 students; that figure is expected to fall to about 221,000 in 2020-21.

The report’s authors posit a number of possible causes for the shift, including demographic changes, the economic downturn, the rise of home schooling, and the increase in quality public options such as charter and magnet schools. They also posit that the increasing cost of college has made families more reluctant or able to pay for primary and secondary education as well.