2016 august grayreports - demand trends in higher education

GRAYREPORTS Demand for Higher Education Programs

www.GrayAssociates.com

Results through August 2016

617.366.2838 www.GrayAssociates.com 2

GRAY For more information please contact Gray Associates. Email: [email protected]

Who Is Gray?

Program and Market Evaluation Data

Employment BLS/O*NET

Placement Rates Gray Research

Student Inquiries GrayReports

Demographics US Census

Job Postings CEB TalentNeuron

Programs Price Projects Place §  Program portfolio

strategy §  Program Profiles §  Program development

§  City targeting §  Location selection §  Campus consolidation

§  Price elasticity §  Price positioning §  Price optimization

§  Business strategy §  Strategy implementation §  Acquisition analysis §  Complex analytics

Advanced Analytics Predictive Models

Geo-Analytics

Clients: Higher Education Institutions and Stakeholders

Competition IPEDS+

Gray’s Program Evaluation System is available as a SaaS solution.

Enhanced Crosswalks



Agenda

1.  Inquiry and Conversion Trends:

1.  National

2.  Online and On-Campus

3.  Degree and Channel

2.  Integrated View of Student and Employer Demand:

1.  City and Program

2.  Programs and Occupations

3.  IPEDS: 2015 Update

4.  Summary



- - - - -

200,000

400,000

600,000

800,000

1,000,000

1,200,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

National Inquiries All Programs and Award Levels

2014 2015 2016

Overall Student Inquiries (All Sources)

We will share data from 2014, 2015, and 2016

Introduce how to read chart: years and colors



-

200,000

400,000

600,000

800,000

1,000,000

1,200,000



2014 2015 2016


Inquiries have decreased an average of 9% year-over-year in 2016.

-9%




However, in August, inquiry volumes nearly reached last year’s levels and January’s highs.

-0.7% YoY

-

200,000

400,000

600,000

800,000

1,000,000

1,200,000



2014 2015 2016



Branded Inquiries

Branded inquiries have increased almost every month this year. They jumped 22% in August.

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000


National Branded Inquiries All Programs and Award Levels 2014 2015 2016

+22% YoY

Define Branded Inquiries: Inquiries for a particular school’s brand name



External Inquiries: Overall Results

External inquiries have fallen every month this year, by an average of 15% year-over-year. §  In August, external inquiries were down almost 10%.

-10% YoY

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000


National External Inquiries All Programs and Award Levels 2014 2015 2016

Define External Inquiries: Inquiries from a third-party site that generates inquiries for higher education.



Inquiry to Application: Overall Conversion Rates

In 2014 and 2015, conversion rates were volatile. §  Since Q1 2014, quarterly rates have risen as little as 1% and as much as 22%.

80

85

90

95

100

105

110

115

120

125

Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016

Overall Inquiry Conversion Rates: Trends (Indexed to Q1 2014)

1.  Applications are counted in the month in which the inquiry was received (i.e., an inquiry that is received in January and converts in March will be counted as a January inquiry). Typically, the application rate will rise for at least three months after the month in which the inquiries were received.

2.  Total includes unknown source type.

+11%

+22%

+1%

Explain Conversion

Rates



Inquiry to Application: Overall Conversion Rates

In 2016, conversion rates seem to be stabilizing, close to 2014 levels. §  Q2 2016 has one month left to mature and is close to Q1 2014 levels. §  Behind the scenes, Branded conversion rates are falling. Conversion rates for External inquiries are flat.

80

85

90

95

100

105

110

115

120

125

Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016

Overall Inquiry Conversion Rates: Trends (Indexed to Q1 2014)


2.  Total includes unknown source type.

-1%



Overall Student Inquiry Conversions (All Sources)

For May inquiries, total student conversions fell 17% year-over-year. §  Conversions are taking longer, so May might continue to improve. §  As they mature, conversions in June, July, and August are likely to reach last year’s levels.


0 5,000

10,000 15,000 20,000 25,000 30,000 35,000 40,000


Total Inquiry Conversions All Programs and Award Levels

2014 2015 2016

-17% YoY

Transition: Let’s turn to April May and June

Immature Months1



Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2014 $41.72 $41.81 $41.70 $42.45 $40.94 $44.23 $44.25 $44.00 $45.34 $45.43 $44.79 $42.18 2015 $43.10 $43.50 $43.70 $43.61 $43.80 $43.63 $45.07 $44.75 $45.24 $44.92 $44.67 $44.75 2016 $45.11 $45.91 $44.79 $44.85 $42.47 $44.97 $44.41 $44.65 $- $- $- $-

$30 $32 $34 $36 $38 $40 $42 $44 $46 $48

Average Price per Inquiry for PPI All Programs and Award Levels

Average Price for Pay-per-Inquiry

In August, the price of an External inquiry was nearly flat year-over-year. §  So far in 2016, the average price for paid inquiries is up only 2% year-over-year.

Note: PPI means “Pay per Inquiry.” Inquiry price is the average price per inquiry from PPI.

-0.2%



Agenda


1.  National







4.  Summary



0

50,000

100,000

150,000

200,000

250,000

300,000

350,000


Inquiries

Inquiries for Online Programs All Programs and Award Levels

2014 2015 2016

Inquiries for Online Programs Education Industry Inquiries: YOY Percent Change Year-to-date, inquiries for online programs have dipped 1% year-over-year.

-1%



Inquiries for Online Programs Education Industry Inquiries: YOY Percent Change Reversing the trend, inquiries for online programs jumped more than 15% year-over-year in each of the last two months.

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000


Inquiries

Inquiries for Online Programs All Programs and Award Levels

2014 2015 2016

15% YoY



Student Inquiry Conversions for Online Programs

Conversions for online programs declined 12% in May. §  Conversions are taking longer, rising from three months to five or six. §  For example, March inquiries continued to convert; they are now up 13%. §  June, July, and August might beat last year.

0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000

10,000


Inquiry Conversions for Online Programs All Programs and Award Levels

2014 2015 2016

Immature Months1

-12% YoY 1.  Conversions are counted in the month in which the inquiry was received (i.e., an inquiry that is received in January and converts in March will be counted as a January

conversion). Typically, conversion rates will rise for at least three months after the inquiries were received.



Inquiries for On-Campus Programs

In August, inquiries for on-campus higher-education programs dropped 17% year-over-year.

§  The first seven months of 2016 have fallen below year-ago levels by an average of 14%.

2012

0 50,000

100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000


Inquiries

Inquiries for On-Campus Programs All Programs and Award Levels

2014 2015 2016

-17% YoY 1.  Conversions are counted in the month in which the inquiry was received (i.e., an inquiry that is received in January and converts in March will be counted as a January

conversion). Typically, conversion rates will rise for at least three months after the inquiries were received.



Student Inquiry Conversions for On-Campus Programs

Conversions for on-campus programs continued to decline—down 13% YoY in May. §  However, June and July may beat last year.

0 2,000 4,000 6,000 8,000

10,000 12,000 14,000 16,000 18,000 20,000


Inquiry Conversions for On-Campus Programs All Programs and Award Levels

2014 2015 2016

-13% YOY Immature Months1

1.  Conversions are counted in the month in which the inquiry was received (i.e., an inquiry that is received in January and converts in March will be counted as a January conversion). Typically, conversion rates will rise for at least three months after the inquiries were received.



Agenda


1.  National







4.  Summary



-21%

-11%

-6%

-4%

-1%

61%

-30% -20% -10% 0% 10% 20% 30% 40% 50% 60% 70%

Associate's

Bachelor's

Master's

Doctorate

Certificate

Post-master's certificate

Quarterly Change in Inquiries 2016/2015 (June to August)

Inquiry Volumes by Degree – Trailing Three Months

Post-Master’s certificates were the only degree-level that grew, but they grew 61%. §  Surprisingly, Certificates out performed higher-level degrees over the past three months.



Inquiry Volumes by Channel – Trailing Three Months

For the most part, Branded inquiry channels outperformed External inquiries. §  Social Media continued to be the fastest-growing channel, by far. §  Six different Branded inquiry channels grew in the most recent quarter. §  A new branded channel (Event) has appeared for the first time this year and shown strong volumes. §  Two external channels grew year-over-year for this period.

-57% -56%

-41% -36% -33% -26%

-16% 3% 9% 12%

21% 27%

87% 207%

358%

-100% -50% 0% 50% 100% 150% 200% 250% 300% 350% 400%

All Other Internal: Branded PPC - Inbound Call: Branded PPL: External Referral: Branded Display: Branded Email: Branded Interactive: Branded Offline Media: Branded Organic: Branded Affiliate: External PPC: Branded Website: Branded Inbound Phone: Branded Affiliate - PPC: External Social Media: Branded

Quarterly Change in Inquiries by Channel All Programs and Award Levels

(June through August YoY)



Agenda


1.  National







4.  Summary



The Big 5 Programs: August Growth

All of the Big Five programs shrank in August. Nursing took a surprising 5% drop. §  Criminal Justice/Police Science performed the best, but fell 4%. §  Medical Assistant dropped 15% (again). §  Business Administration dropped over 30% at the Bachelor’s and Associate’s levels.

-4% -5%

-15%

-33%

-39% -45%

-40%

-35%

-30%

-25%

-20%

-15%

-10%

-5%

0%

Criminal Justice Registered Nursing Medical Assistant Business Admin: Bachelor's +

Business Admin: Associate's -

Five Largest Programs Since January 2012 Year-over-Year Change in August Inquiries

2016 YoY % Change



-49% -87%

36% 18%

-22%

690%

584%

246%

144% 119%

-100%

0%

100%

200%

300%

400%

500%

600%

700%

800%

Human Services Counseling Psychology

Cosmetology Medical Insurance Coding

Health Information/Medical Records

Technology

The Fast 5 Programs Year-over-Year Change in August Inquiries

2015 YoY % Change 2016 YoY % Change

The Fast 5 Programs: The Higher Education Programs with the Fastest Inquiry Growth

Two new programs showed up in the five fastest-growing programs1. §  All five programs increased over 100% in August2. §  Human Services, Counseling Psychology, and Medical Insurance Coding are repeats from last month.

1.  Includes the top 75 programs in inquiry volume since January 2012. 2. May reflect competitive marketing, or reporting by Gray’s data suppliers.



-15%

-6%

-2%

-1%

5%

7%

9%

9%

13%

13%

-20% -10% 0% 10% 20%

Cosmetology Business Admin: Associate's - Business Admin: Bachelor's + Human Services Counseling Psychology Medical Assistant Registered Nursing Criminal Justice Health Info/Medical Records Tech. Medical Insurance Coding

Year-Over-Year Change in New Job Postings

Change in New Job Postings for “Big 5” and “Fast 5” Programs

Six of the “Big 5” and “Fast 5” programs had an increase in new job postings over the past year.

§  All of the healthcare-related fields that are shown experienced an increase in job postings. §  Business Administration programs are suffering decreases in student demand and job postings.

Growing Student Demand and Jobs

Growing Student Demand, Declining Jobs



Student Inquiries: The Big 5 Cities

Only one of the Big 5 cities grew year-over-year. §  Philadelphia grew 7% in August. §  Los Angeles had the largest decline–a drop of almost 40%.

-11% -10%

6%

-7%

-17%

7%

-6%

-16% -19%

-39%

-50%

-40%

-30%

-20%

-10%

0%

10%

Philadelphia, PA New York, NY Chicago, IL Atlanta, GA Los Angeles, CA

Top Five Cities for Inquiries Since January 2012 Year-over-Year Change in August Inquiries

2015 YoY % Change 2016 YoY % Change

Note: The market for each city is defined as a 15-mile radius around the population center of its CBSA.



New Job Postings: Ten Largest Programs in Philadelphia

In Philadelphia, The programs with the most job postings range from CDL to computer science.

§  Bachelor’s in Business, as always, is the largest programs for job postings. §  Truck and Bus Driving (CDL) is second with 28,000 new postings.

0 10,000 20,000 30,000 40,000 50,000

Business Admin: Bachelor's +

Truck and Bus Driver

Registered Nursing

Computer Science

Marketing/Marketing Management

Computer and Information Sciences

Selling Skills and Sales Operations

Information Technology

Culinary Arts/Chef Training

Business Admin: Associate's -

New Job Postings Ten Largest Programs in Philadelphia



New Job Postings: Ten Fastest Growing Programs in Philadelphia1

Programs with the fastest growing job postings are ALL in health care and health sciences.

§  Many of these are traditional Allied Health programs. §  But, microbiology, immunology, neurobiology, and epidemiology also made the list.

0% 10% 20% 30% 40% 50% 60%

Radiologic Technology/Science - Radiographer.

Medical Radiologic Tech/Science - Radiation Therapist.

Rehabilitation Aide.

Sterile Processing Technology/Technician.

Microbiology, General.

Medical Microbiology and Bacteriology.

Clinical/Medical Laboratory Technician.

Immunology.

Neurobiology and Anatomy.

Epidemiology.

New Job Postings Ten Fastest Growing Programs in Philadelphia

1.  Includes only programs with more than 200 new job postings over the past year.



Program Evaluation Metrics

Gray evaluates four types of market data to identify programs to Stop, Start, Sustain or Grow.

Student Demand

Industry Inquiries

Inquiry Growth: Unit Growth

Inquiry Growth: % Change

Completions: Unit Volume

Completions: Unit Growth

Employment

Job Postings

Total Employment

Job Growth

Job Postings Per Graduate

Placement Rates

Competitive Intensity

Number of Competitors

Competitor Mix

(e.g., Public vs. For-Profit)

Cost Per Inquiry

Completions Per Capita

Degree Fit

Completions: Degree Level

Employment: Degree Level

Wages



In addition to inquiries, a program evaluation requires data on competition, jobs, wages, and degree fit.

Program Scorecard: Marketing/Marketing Management

The demand is strong for this program. But demand is not all you should consider.

It is primarily Bach and Grad program

Lots of competition in Phil.

But, far more job postings than graduates. (the average is 5 job postings per grad for a typical large program)



CEB TalentNeuron: Employment Summary

Digging further into the job postings confirms the demand shown in the scorecard.

§  The Hiring Scale shows how hard it is for employers to find qualified candidates. §  We can provide required skills and certifications to help focus course materials.

Source: CEB TalentNeuron analysis of SOCs 11-2021, 11-2011, 13-1161.



Agenda


1.  National







4.  Summary



NCES Crosswalks

NCES crosswalks assume a tight link between program of study and occupation.

§  NCES crosswalks a B.A. in History to just four occupations (SOCs).

History, General CIP 54.0101

Managers, All Other SOC 11-9199

Historians SOC 19-3093

Source: National Center for Education Statistics: SOC 2010 mapped to CIP

History Teachers, Postsecondary SOC 25-1125

Secondary School Teachers, Except Special and Career/Technical Education

SOC 25-2031



Reality: Loose Alignment, especially for Liberal Arts

According to the U.S. Census, History majors are actually employed in over 400 SOCs, not four.

Source: U.S. Census Bureau; Gray analysis of over 2.0 million records

1 4

462

-

50

100

150

200

250

300

350

400

450

500

CIPs (Programs) NCES Matched SOCs Actual Employment: SOCs

Count of Programs and Occupations CIP 54.0101 History, General



What Do History Majors Do? Teach, go to law school, become CEOs….

$18,840 $22,480

$28,340 $29,700

$39,690 $42,380

$44,180 $44,290 $44,580 $45,520

$59,210 $60,450

$64,150 $65,290

$73,640

$0 $20,000 $40,000 $60,000 $80,000

Retail salespersons Secretaries and administrative assistants

First-line supervisors of retail sales workers Clergy

Sales representatives, wholesale and Elementary and middle school teachers

Postsecondary teachers Librarians

Secondary school teachers Accountants and auditors Miscellaneous managers

Management analysts Education administrators

Chief executives and legislators Lawyers, judges, and other judicial workers

25th-Percentile Annual Wage for Each Occupation

Top 15 Occupations and Wages Program: BA in History



Agenda


1.  National







4.  Summary



Overall Completions

Completions have increased in each of the past four years.

§  Since 2011, completions are up 4.6%.

4.83 4.97 4.98 5.02 5.05

0.00

1.00

2.00

3.00

4.00

5.00

6.00

2011 2012 2013 2014 2015

National Completions All Programs and Award Levels

Completions in Millions



Completions by Sector

Public higher-education institutions produce a majority of the graduates nationally.

§  Public institutions are also growing the fastest, up 14% since 2011 versus 5% for private not-for-profits and 3% for proprietary schools.

2,777 2,922 3,000 3,086 3,172

1,118 1,141 1,156 1,174 1,179 681 705 696 751 702

0

1,000

2,000

3,000

4,000

5,000

6,000

2011 2012 2013 2014 2015

National Completions All Programs and Award Levels by Sector

Public Private not-for-profit Proprietary

Completions in Thousands



Ten Largest Programs

The ten largest programs produced 22% of the total completions in 2015.

§  Liberal Arts (AS) was the largest program, with nearly double the amount of the second largest program.

243

140

125

116

109

89

85

76

74

69

0 50 100 150 200 250 300

Liberal Arts and Sciences (AS)

Business Administration (BA)

Registered Nursing (BA)

Psychology, General (BA)

Business Administration (MS)

General Studies (AS)

Registered Nursing (AS)

Cosmetology (Cert)

Biology (BA)

Medical Assistant (Cert)

National Completions Ten Largest Programs Completions

in Thousands



Ten Fastest Growing Programs

Seven of the ten fastest growing programs are certificate programs.

238%

191%

174%

155%

147%

108%

101%

93%

84%

75%

-100% -50% 0% 50% 100% 150% 200% 250% 300%

Game and Interactive Media Design (Cert)

Intermedia/Multimedia (BA)

Security and Loss Prevention (Cert)

Health Care Facilities Admin./MGT. (Cert)

Computer Systems Analyst (MS)

Health Services Administration (AS)

Heavy Equipment Maintenance Tech. (Cert)

Medium/Heavy Vehicle and Truck Tech. (Cert)

Selling Skills and Sales Operations (Cert)

Operations Management and Supervision (Cert)

National Completions Ten Fastest Growing Programs

2015 YoY % Change



2015 Completions by Ethnicity

2,808

700 588

275 261 254 117 34 15

0

500

1,000

1,500

2,000

2,500

3,000

White Hispanic or Latino

Black or African American

Asian Race/ethnicity unknown

Nonresident alien

Two or more races

American Indian or

Alaska Native

Native Hawaiian or Other Pacific

Islander

National Completions All Programs and Award Levels by Ethnicity




Online Completions

Distance education completions have increased 24% since 2013.

§  2013 was the first year distance education completions were reported. §  The volumes of these are not perfect due to schools only being required to report if the program is offered

online, meaning that schools that offer the same program on-campus will show both modalities as distance education.

911

1,057 1,126

0

200

400

600

800

1,000

1,200

2013 2014 2015

Distance Education Completions All Programs and Award Levels




Agenda


1.  National







4.  Summary



Key Demand Trends and Observations

The downward trend may have ended in August.

§  Inquiry volumes fell less than 1%. §  Branded and online inquiries grew. §  Conversions of May inquiries were down 17% YoY, but inquiries seem

to be converting much later than in past years. §  Average inquiry prices continued to stay below $45. §  Surprisingly, Certificate programs outperformed higher degrees. §  Social Media continues to be a strong channel. §  Better data and systems are available to support your decisions. ─  Where to focus your marketing—by program and market ─  What careers to focus on ─  What programs to Stop, Start, Sustain or Grow



Questions and Contacts

Please feel free to contact:

Bob Atkins CEO

Gray Associates, Inc.

[email protected] @Gray_Associates

617.366.2836



Upcoming Gray Associates’ Webcast

Please join us next month!

October Webcast (September Results)

Thursday, October 20th at 2:00 PM EDT