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Today, we’re facing structural and unprecedented change in our economy and education environment. And a lot of benefit will emerge. But as we go through this change, we need a better understanding of reality and avoid using data that applied to the old world to measure the new world.
And some of our past assumptions on what a “safe” major is may not apply, at least in the same way as before.
I’ve spent a fair amount of time showing the fundamental flaw in the Earnings Premium / ROI bandwagon, in that federal law and accreditation proposals rely on baseline data that ignores demographics such as regional income variation. And as an exercise I showed that you can determine baseline earnings metrics from the same data source.
But what about positive examples that point to better approaches? Well, this week there are two examples of note.
Al Essa
Al Essa in his AI-Learn Insights newsletter added his research chops to explore this subject that I raised. And he went beyond confirming the problem, he provided a model that would be a much better approach to measuring whether a college degrees adds economic value to graduates.
At first glance, both programs appear to pay for themselves quickly according to C-ROI—just over four months for Coastal Valley College and just under a year for MetroTech Institute. That’s the surface story.
But if our goal is to understand how long graduates are “sitting on the runway” before their careers truly take off, C-ROI alone is likely to be too crude. It ignores the fact, for example, that local labor markets matter—a lot. A dollar of extra earnings in one region may be much harder to achieve in another, even for the same program.
As Phil Hill, one of the most widely respected analysts of higher education technology and policy, has suggested, moving from a statewide to a regional calculation can paint a very different picture of how programs perform for the students they actually serve. That’s where we turn next: looking at regional ROI metrics that might better reflect labor market reality.
Did I really need to share that last paragraph? That’s between me and my therapist.
Al then applies the regional differences to these two colleges (real data, anonymous naming).
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