Measuring the Value of Postsecondary Education

16 Submissions
154 Views
$20,000 USD
Due:  27th May 2024

Challenge overview

OVERVIEW

Lumina Foundation, the Seeker for this Wazoku Crowd Challenge, is looking for metrics and related datasets that would allow measuring the effects of postsecondary education on economic well-being.

For the last 15 years, Lumina Foundation has been working to increase post high school attainment in the United States by transforming the postsecondary system and making learning opportunities available for all. Lumina’s work centers on large-scale, system-change strategies to improve participation, increase student success, and better align credentials with the labor market.

Today, the U.S. system of postsecondary education experiences significant problems, including declining college enrollment, skyrocketing costs, and unequal access to educational resources. Exacerbating these problems are doubts about the value of postsecondary education, and concern that it cannot provide the recipients with measurable economic and non-economic benefits.

There is plenty of data that point to the value of postsecondary education as a recent study by Lumina Foundation and Gallup, Education for What?”, demonstrates. But this data alone is not sufficient to answer the question: is it worth it? And, more specifically, is it worth it for someone that looks like me or has my background?

Often, when we consider the value of postsecondary education, we think of wages. Indeed, there is data to show that those with more education make more money. However, only looking at wages is no longer sufficient: more people have the perception that the cost of postsecondary education is too high, and the economic outcomes are too low.

It is therefore essential to identify a good metric that can address the return on investment (ROI) — a metric that would consider both the value of postsecondary education and its cost.

The goal of this Challenge is to design a quantitative metric and identify an appropriate set of data sources that would allow measuring the impact of postsecondary education on economic well-being — defined as an ROI based on data specifically looking at the ratio of cost/debt/price to earnings at the national and state levels, which can be further disaggregated by race/ethnicity, credential type, and graduates’ age and expressed at the individual, not institutional, level (with all the data appropriately anonymized).

By taking part in this Prize Challenge you are granting Lumina Foundation a right to use (but not own) your submitted information, however Lumina Foundation must determine award winners within 45 days from the start of evaluation, otherwise they lose this right.

This Prize Challenge requires a written proposal to be submitted. There will be a guaranteed award pool of $20,000, with at least one award of $5,000 or larger and no award being smaller than $2,500. Award distribution (or allocation) will be contingent upon the theoretical evaluation of the proposals. 

Submissions to this Challenge must be received by 11:59 PM (US Eastern Time) on May 27, 2024. 

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In our latest Challenge Space, the Lumina Foundation Evaluators told us about their top tips! If you're interested in learning more about the Evaluators' requirements for this Challenge, we invite you to watch the below webinar recording.

ABOUT THE SEEKER & ELIGIBILITY

Lumina Foundation is an independent, private foundation in Indianapolis committed to making opportunities for learning beyond high school available to all. We envision higher learning that is easy to navigate, addresses racial injustice, and meets the nation’s talent needs through a broad range of credentials. We are working toward a system that prepares people for informed citizenship and success in a global economy. For more information on Lumina, visit: luminafoundation.org.

Employees of Lumina Foundation, as well as members of Lumina’s board of directors and investees of Lumina Impact Ventures, are ineligible to receive an award for this Challenge.

Find out more about participation in Wazoku Crowd Challenges.

 

THE CHALLENGE

Background

Today, the U.S. system of postsecondary education experiences significant problems, including declining college enrollment, skyrocketing costs, and unequal access to educational resources.

Among the most prominent challenges are:

  • Declining College Enrollment. College enrollment rates were falling even before the COVID-19 pandemic, but the numbers literally nosedived in 2020 and 2021 and remain well below pre-pandemic levels.
  • Soaring Costs and Crushing Student Debt. The cost of attending college has skyrocketed in recent decades, outpacing inflation by a significant margin. This has resulted in a staggering amount of student loan debt, currently exceeding $1.75 trillion nationally, a huge financial burden facing the graduates.
  • Unequal Access and Outcomes. Access to higher education remains unequal across different demographics, with students from low-income families, minority groups, and rural areas often facing additional hurdles, such as limited financial aid options and geographic barriers.
  • Relevance to the Job Market. Concerns exist regarding the perceived mismatch between the skills students acquire in college and the demands of the current job market. This has led to questions about the value proposition of traditional four-year degrees and a growing interest in alternative pathways to careers, such as vocational training and certificate programs.

Perhaps somewhat surprisingly, another problem has emerged over the past few years that exacerbates the above-mentioned problems: doubts about the value of postsecondary education, and concern that it cannot provide the recipients with measurable economic and non-economic benefits.

Unless you have blocked social media and don’t read the news, you’ve heard that college education isn’t worth it. More and more people are claiming that you no longer need a college degree to get a job, that the return on investment (ROI) of educational expenses isn’t in the student’s favor, and that higher education isn’t preparing people well for joining the workforce.

This is not true. Many studies show the value of higher education. Here are some facts:

  • New research from the Georgetown University Center on Education and the Workforce shows that US adults with college degrees can expect to earn an additional $14.2 trillion over their lifetimes —money that will bolster the US economy through consumer spending, tax revenue, and employment.
  • A Lumina Foundation-Gallup survey found that a large share of respondents (74%) think that postsecondary credentials are important for a successful career.
  • Morning Consult confirmed these findings in a study that pointed to college as a path to personal well-being. 75% of respondents expressed an opinion that their children and loved ones should earn a college degree to have a good life.
  • Another Lumina Foundation-Gallup study, Education for What?”, found that a college degree and post-high school credentials can improve life in 50(!) different ways. Results showed that people with degrees were healthier, more civic-minded, closer to family and friends, and had better jobs with higher pay.

Yet, paradoxically, while most Americans see the value in education beyond high school, the share of people expressing a lot of confidence in higher education (or a great deal of confidence) has declined from 57% in 2015 to just 36% in 2023.

Why? The truth is that while income and wages are necessary parts of the value conversation, value is more than wages. If we truly want to understand the value of postsecondary education, we must also consider cost – and for many this means long-term debt – as well as opportunity cost (the time it takes to obtain a degree or credential).

In other words, we need to identify a good metric that can address the return on investment (ROI) of postsecondary education, a metric that would consider both the value of postsecondary education and its cost.

Some data addressing the ROI issue does exist, but it’s spotty at best, i.e., available only for specific communities, such as for a university’s recent alumni classes, or for a state that can collect data on those who attended their state universities.

In addition, while data exists looking at the outcomes of two-year or four-year college degrees, there is little to no systematic way to measure the outcome of short-term credentials, such as industry-based certifications or certificates provided by a two-year or technical college.

As a result, there is a lack of simple, intuitive, reliable data that provides information on cost of postsecondary education at the individual, not institutional, level that would allow the “apple-to-apple” data comparison and its holistic analysis.

The Challenge

To respond to these concerns, we need a way to measure the ROI of postsecondary education that would consider not only the income the individual receives after attaining a credential but also the full cost of attaining the credential (whether paid up front or taken as debt).

A few established economic/financial indicators are routinely employed to measure the benefits of post-secondary education — for example, by the U.S. Census Bureau to compose the Post-Secondary Outcomes (PSEO) reports — of which the most popular are:

  • Wages and income
  • Lifetime earnings
  • Employment rate
  • Job security

It’s not fully clear, however, which specific benefit indicator (or their combination) would represent the optimal metric to be used to calculate ROI — both in terms of its predictive power and the availability/completeness of the datasets collecting this indicator.

Yet, it’s the cost factor that represents the most difficult part of the ROI equation.

National data on postsecondary debt is collected (e.g., Survey of Consumer Finances), but it is not regularly updated, its sample size is small, and it is often at the family, not individual, level. Besides, it only addresses debt (that is, it doesn’t tell us what someone has already paid, only what they currently owe), and does not provide a sufficient national view for all types of credentials. Nor does it provide an ability to disaggregate the data by state, by credential type, or to properly reflect profiles of today’s students.

By posting this Challenge, Lumina Foundation wants to focus on the identification of a currently available source of data (or sources of data) to measure specifically the cost of postsecondary education — or a set of available sources of data that could be easily expanded to provide the necessary data. Alternatively, although much less desirable, we will consider actionable ideas on how such a data source could be created from scratch. 

Important: We welcome fresh ideas related to assessing the benefits of postsecondary education. For example, we would be interested to learn which specific metric (or a combination of metrics) can provide an optimal measure of the benefits. However, our priority is cost. It’s the submissions that address the cost factor of the ROI equation that will receive preferential treatment.

The proposed datasets should be publicly available and provide (or be designed to provide) the ability to be regularly (i.e., annually) updated.

These metrics should consider five educational levels:

  • Certificates (awarded by institutions like colleges, universities, or private training providers)
  • Certifications (granted by professional organizations or industry bodies after passing exams or meeting specific requirements)
  • Associate degree (AA) (2 years to complete)
  • Bachelor's Degree (BA) (4 years to complete)
  • Graduate Degrees (Master's, Ph.D.) (1-6 years to complete depending on the program)

All data must be able to be disaggregated by national and state levels, race/ethnicity (Asian, Black, Hispanics, Native American, and White), gender, and age. Equally important, all data should be expressed at the individual, not institutional, level (with all the data appropriately anonymized).

 

SOLUTION REQUIREMENTS

To summarize, any successful solution should meet the following major Solution Requirements:

  1. The proposed value metric and data source should be able to quantitatively measure the cost of attaining a postsecondary credential.
  2. Ideally, an optimal metric (or a combination of metrics) and their sources to quantitatively measure the benefit of attaining a postsecondary credential will be proposed too.
  3. The proposed value metrics should consider at a minimum five education levels: certificate, certification, AA, BA, and Graduate+, each broken down by national and state levels, race/ethnicity, gender, and age — and expressed at the individual level (with all the data appropriately anonymized).
  4. The proposed value metrics should be based on datasets that could be periodically (ideally, annually) updated.

At the same time, we will not consider solutions that are:

Important! We welcome proposals based on international experience. However, the Solvers should provide a thorough and detailed explanation of how this experience can be successfully implemented in the U.S. postsecondary educational system.

An ideal solution will be presented as an essay not exceeding 15 pages with a one-page Executive Summary. The essay should provide a detailed description of proposed value metric(s) — as well as a thorough justification of the reasons for their selection — supported by relevant examples, showcases, publications, etc. Should operating the metrics require an algorithm, appropriate code needs to be provided too.

This Prize Challenge, has the following features:

  1. There will be a guaranteed award of $20,000, with at least one award being $5,000 or larger and no award being smaller than $2,500.
  2. The award distribution will be determined after theoretical evaluation of the proposals by Lumina Foundation.
  3. By taking part in this Prize Challenge you are granting Lumina Foundation a right to use (but not own) your submitted information, however Lumina Foundation must determine award winners within 45 days from the start of evaluation, otherwise they lose this right.
  4. Lumina Foundation may also issue “Honourable Mention” recognitions for notable submissions that are not selected for monetary awards.
  5. Lumina Foundation may wish to partner with the Solver at the conclusion of the Challenge. Please include a statement indicating your interest in partnering.

YOUR SUBMISSION

Please login and register your interest, to complete the submission form.

The submitted proposals must be written in English and include:

  1. Participation type – you will first be asked to inform us how you are participating in this challenge, as a Solver (Individual) or Solver (Organization).
  2. Solution - the Technology Readiness Level (TRL) of your solution, TRL1-3 ideation, TRL4-6 proof of concept, TRL7-9 production ready — non-applicable for this Challenge.
  3. Problem & Opportunity - highlight the innovation in your approach to the Problem, its point of difference, and the specific advantages/benefits this brings (up to 500 words).
  4. Solution Overview - detail the features of your solution and how they address the Solution Requirements (500 words, there is space to add more in the summary field below, and to add any appropriate supporting data, diagrams, etc.).
  5. Experience - Expertise, use cases and skills you or your organization have in relation to your proposed solution (up to 500 words).
  6. Solution Risks - any risks you see with your solution and how you would plan for this (up to 500 words).
  7. Timeline, capability and costs - describe what you think is required to deliver the solution, estimated time and cost (up to 500 words).
  8. Online References - provide links to any publications, articles or press releases of relevance (up to 500 words).

Wazoku encourages the use by Solvers of AI approaches to help develop their submissions, though any produced solely with generative AI are not of interest.

Find out more about participation in Wazoku Crowd Challenges.

Submissions to this Challenge must be received by 11:59 PM (US Eastern Time) on May 27, 2024.  

Late submissions will not be considered.

Your submission will be evaluated by the evaluation team first reviewing the information and content you have submitted on the submission form, with attachments used as additional context to your form submission. Submissions relying solely on attachments will receive less attention from the evaluation team.

After the Challenge submission due date, Lumina Foundation will complete the review process and make a decision with regards to the winning solution(s) according to the timeline in the Challenge header. All Solvers who submit a proposal will be notified about the status of their submissions.

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Macrocompassion Macrocompassion

There is no certainty that a well-educated person has any more value than one who is less well educated. The value of a person is more dependent on the attitude that person takes to working in or otherwise supporting society and the possible amount of this can be judged but not measured directly. Would you say that the following explanation comes from a good education or a fair experience of life? Philosophy of ChangeChange brings pain—again and again.Pain brings suffering—uttering, mutteringSuffering brings tolerance—with much endurance.Tolerance brings thinking—and good ideas linking.Thinking brings knowledge—saves going to college.Knowledge brings understanding—sensibility expanding. Understanding brings wisdom—and where it comes from.And wisdom makes life bearable—happily declarable! A degree of education does not necessarily relate to a person’s personality not to his/her creativeness, so it seems to me that when we measure how much post-secondary education per average person is available in one place, we cannot then logically relate it to the nature of the average person’s contribution to national well-being and progress.