Going the Distance

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When Duncan Birch enrolled in Purdue University six years ago to pursue a degree in chemical engineering, he was part of the rising tide of Americans seeking a college education. That number has been slowly growing, from 14.3 million in 1993 to 15.4 million in 1997, according to the National Center for Education Statistics (NCES) - a significant increase from the 12.7 million who were enrolled in college a decade earlier.

But Birch, now 24, never completed his degree program. He dropped out after three semesters and drifted from a fast-food job to one at a coffee shop, to another at an electronics chain. Eventually he landed a position at the telephone help desk of a Wall Street financial firm, where he earned a license to trade securities, learned HTML, and helped to run the company intranet. As his technical knowledge increased, his salary nearly tripled. "People in this field don't care about your education," Birch claims. "The technology changes so fast, they just care if you're keeping up."

Birch represents a trend that has received much less attention: The number of people with some college experience - but who lack a diploma - has been steadily growing as well. Nearly one-third of the college freshmen filling the classrooms, libraries, and dining halls across the country this month won't return for their sophomore year, according to the newsletter, "Postsecondary Education Opportunity."

High dropout rates have a profound effect on the working population. Since 1992, the first year the Bureau of Labor Statistics started tracking educational attainment by highest degree received, the number of adults in the workforce aged 25 to 64 with some college but no degree has steadily grown to near 21 million, up from 18.7 million. During the same period, the number of people with a bachelor's degree or better climbed to 33 million, up from 27 million. As percentages of today's labor force, workers with a college degree still outrank the noncompleters. But together, they account for 48 percent of the labor force age 25 to 64. Such changes have forced employers and some marketers to reexamine the civilian workforce - how people without college degrees function as employees and how they behave as consumers.

New horizons

Up until World War II, college was just a dream for most Americans. In 1937, fewer than 1.5 million students were enrolled in U.S. colleges and universities. Today, college is de rigeur. Part of the change can be attributed to what might be called the "good-intentions factor." In 1982, just 58 percent of high school seniors said they planned to go straight to college after graduation. By 1992, that number was 69 percent and in 1993, it ballooned to 79 percent. Parental expectations are just about as high. In a national survey by Westat in 1993, 74 percent of parents said they expected their children to earn a college degree. In 1996, that number hit 81 percent.

A high school student's chances of going on to college rise dramatically if his parents also attended college. So it's not surprising that baby boomers, the largest and best-educated generation ever to help their children fill out college applications, are sending record numbers of students onward. Among graduates aged 18 to 24 in 1996, 91 percent of those whose parents held a bachelor's degree or higher enrolled in college. Of those whose parents had some college but no four-year degree, 77 percent enrolled, according to "Postsecondary Education Opportunity."

Most seniors who say they plan to go on to college actually do matriculate. About 67 percent of some 2.8 million 1997 high school seniors went directly to college, according to the U.S. Census Bureau, swelling the ranks of traditional college-age students (those under 25) to a record 9.4 million. More young women than men enrolled that year - 70 percent, compared with 64 percent of men. And whites outpaced blacks, 68 percent to 60 percent. Besides increased aspirations, part of the growth simply comes from the rise in the number of school-age children, known as the baby boomlet - a trend that will continue for the next decade.

But if other historical trends hold, the rush to register won't result in a higher percentage of college students receiving diplomas. That percentage has held relatively steady in the last 15 years at between 25 percent and 30 percent - hardly keeping pace with the aspirations of American families. This despite the fact that median earnings of those without a bachelor's diploma remain considerably lower than those of their degreed counterparts. Median wages of workers with a high school diploma are just 58 percent of the college grad medians. Workers with some college but no degree do better, but not by much: Their median earnings are 68 percent of those with four-year degrees. But after years of steady decline, both groups did begin to see wages edge up again from 1997 to 1998, aided by the economic boom and the tight labor market.

Because entering college has become the "norm," Vincent Tinto, Distinguished University Professor at Syracuse University, suggests the curve representing percentage enrollment may be taking on the sigmoidal or S form that usually suggests a population is reaching a limit. "We may be approaching the enrollment saturation point for people whose decision to go to college is a reflection of an intentional, well-thought-out commitment of time and energy," Tinto says. A new study by Clifford Adelman, a senior research analyst for the U.S. Department of Education, indicates Tinto may be right. An increasing number of students leave college without even earning 20 credits, a fact that Tinto says raises questions about how committed they were in the first place.

There are many reasons why students leave college. Some, like Duncan Birch, eventually find jobs that preclude the need to return. Others face financial challenges. And many aren't prepared to go to college in the first place. Adelman's study suggests that a high school curriculum of high intensity and quality - in particular, taking mathematics classes beyond algebra 2, such as trigonometry and pre-calculus - is the most reliable indicator for success in higher ed, even outweighing socio-economic status, its nearest predictive rival. These findings dovetail nicely with dropout statistics released by the American College Testing Service, which show that the more academically selective a college or university is, the lower its rate of dropouts. In a survey of 2,525 institutions, ACT found that the dropout rate between freshman and sophomore year was 45.7 percent at schools with open enrollment, where typical SAT scores were between 830 and 950, out of a total 1600. At "highly s! elective" colleges, on the other hand, with SAT scores ranging between 1220 and 1380, the dropout rate was just 8.4 percent.

Skilled learners

The fact that an academically intense curriculum is indexed to success after high school has not been lost on corporate America. IBM, along with a number of other blue chip companies that participated in the 1996 National Education Summit, recently began requesting not just proof of a high school diploma for entry-level hires but a complete transcript as well. "Whether people took algebra or statistics is important for quality management," says Robin Willner, director of corporate social policy and programs at IBM. "We look for communications [skills] and some basic computer literacy. It's helpful if they had a lab science." By winnowing down a large pool of high school grads with specific academic criteria, IBM practices on the low end of its hiring scale what most companies attempt to do with college (and "some college") hires.

Again and again, employers are saying that skills are key to the hiring process. This is especially clear at Manpower, Inc., which contracts out most of its 900,000 employees. "We don't care if they come from MIT or Milwaukee Technical," says Shelly Funderburg, director of employee selection systems. "We are only concerned about what they can do."

Manpower doesn't keep statistics on the educational attainment of its contract employees, but president and CEO Jeff Joerres says that samplings have shown a trend toward hiring people with a two-year, post-secondary degree or a four-year education that was cut short.

When customer demand for a particular skill grows faster than the available pool of applicants, Manpower attempts to train people to fill the slots. The starting point is less likely to be educational background than a related skill profile, Joerres notes. For example, as word processing programs have become more sophisticated and Web design tools have gotten simpler, it has become possible to retrain office workers to become HTML or Java programmers. "We call this `prescription learning,'" Joerres says. "There is a void in the low end of technical programming."

Other companies, like Novell and Microsoft, have learned that rapid product development has made it necessary to create a fast track to train and certify technicians to run them. Once again the companies report that educational background of the worker is less important than a strong interest and aptitude for computers. About 160,000 people have passed the course to become a Certified Novell Engineer, for example, and a survey of 16,000 showed that 37.5 percent have more than a high school diploma but less than a college degree. An additional 7.5 percent said that "some vocational training" was their highest level of education, and 12 percent had a high school diploma; 31.5 percent held a bachelor's degree. Of those remaining, 6.8 percent had a master's, 1.2 percent a doctorate, and 3.5 percent reported their highest level of educational attainment as "other."

Microsoft has accredited more than 500,000 Microsoft Certified Professionals, and the percentages are similar. A survey of MCPs in the U.S. and Canada revealed that 40 percent have some college or trade school education. Such jobs, created by high demand in a fast-growing industry, are rewarded with higher rates of pay, depending on skill levels. The average salary for minimally qualified MCPs ranges from $44,000 in the Midwest to $55,000 in the Northeast, according to an industry publication.

Although there is little argument that people with college degrees earn more than those without them, there is also another ongoing trend to consider - the shortage of jobs for college grads. According to BLS projections, 18 percent of those who graduate between 1996 and 2006 may not be able to find jobs appropriate to their degrees. Retiring baby boomers will not compensate for the slowing production of college-level jobs and the increasing number of grads. Other job entrants, too, such as immigrants, people leaving military service, and workers returning to the labor force after a lengthy absence, account for some of the squeeze. That could be why in 1996 there were 120,000 truck drivers with college diplomas, according to the BLS. Conversely, about 40 percent of men and 37 percent of women with some college were in the highest occupational groups, including executive, professional, and managerial jobs.

Under the radar

Marketers may find it difficult to define a group like those with some college, whose members aren't on alumni lists. But income, rather than education, is king when it comes to analyzing survey data or screening a focus group. At the same time, researchers need to consider some big changes. Unlike several decades ago when fewer people could afford to go to school, the distinction between college grads and the rest of the population has grown less defined.

The blurred lines between groups don't disturb those who have succeeded without a degree. Duncan Birch, for example, points out that most of his colleagues do not ask about his education - they just assume he completed college. In fact, a few researchers think the industry could learn from those who see little difference between Birch and his classmates who graduated. Stuart Himmelfarb, a partner at Student Monitor, a college market research firm, suggests that the experience - not the completion of graduation requirements - is what changes a person's perceptions and behavior.

"Students begin to look at the world differently long before they finish school," says Himmelfarb. "I think many people marketing upscale, sophisticated products would do well to cast the net a little wider. People with some college are much more like college grads than people who never went to college at all."

Himmelfarb says that interests in cultural affairs, the arts, and media are formed early in the college years and persist into later life. Like the graduates, people who left college without a degree are significantly more likely than the general population to attend dance performances, see a movie one to three times a month, and vote in local elections, according to Mediamark Research. Of course, there are differences: College grads are more likely to serve on the boards of hospitals and charitable institutions; those without degrees are more likely to sit on the board of a church. Grads are more likely to play billiards and board games; non-grads are more likely to collect sports trading cards.

Just as some marketers see opportunity in lumping the two groups together, others see benefits in targeting the middle tier between high school and college grads. Jon Berry, editorial director at Roper Starch Worldwide, agrees that grads and the "some college" group share a basic optimism about their future. According to Roper research, 34 percent of people with some college agree that the American Dream is "very much alive," a response only slightly lower than that of college graduates (39 percent). Only 25 percent of high school graduates and 23 percent of high school dropouts agreed with the statement. And people with some college are nearly as likely as college grads to say the past year has been "very good" for them (29 percent vs. 33 percent). Similarly, they are as likely to feel the coming year will be better for them as college grads (both 59 percent), and substantially more likely to say so than high school grads (47 percent) or high school dropouts (48 percent).

But Roper's research also indicates that for all their confidence, people with some college are significantly less sophisticated consumers of financial services. Although they are more likely than less-educated consumers to say that their levels of savings are higher than a year ago (22 percent vs. 17 percent for high school grads and 13 percent for high school dropouts), they are far less likely to say so than college graduates (35 percent).

"There are opportunities for financial services marketers to educate people with some college about investing," Berry says. "They have money invested in something, but are far less likely than college grads to have money in the smart investments of the '90s - mutual funds, stocks, and self-directed retirement plans." People with some college are also significantly less likely than graduates to turn to various financial professionals for advice, and more likely to rely on friends and family. "Looking at the data, it seems that the best way to market to this group is to embody some of the characteristics associated with friends and family - being friendly and accessible, staying away from the hard sell," Berry says.

Still, understanding the subtle differences and similarities between the degreed and the "some college" crowd is relatively new here, unlike in England, where screening focus groups by occupation and education is much more common, says Judith Langer of Langer Associates. Groups she has run for several clients have led to some unexpected results, such as the fact that education, not income, correlates most closely with certain consumer decisions, like buying 100 percent cotton sheets and towels or reading Consumer Reports.

Efforts to use education to screen audiences have met resistance in the United States. Amy Blomquist of Gray Direct Marketing remembers trying to convince a pharmaceutical company to include educational demographics in a survey for a new drug. She argued that better-educated consumers were more likely to comply with directions on a prescription. "I lost that battle," she says. "But I think we could look at education more often. I'm sure it affects how people behave."

Michael Thomas, associate director of Healthcare Market Knowledge, the marketing research division of the Acuity HealthGroup, agrees. Acuity is conducting a series of consumer surveys, in collaboration with Harris Black International, to learn more about how attitudes, lifestyles, and demographics - including educational attainment - affect the behavior of patients receiving a variety of drug therapies. "I don't know of anyone [in the healthcare industry] who is focusing on education levels," Thomas says. "It's an area that needs to be addressed, especially regarding compliance, patient retention, and educational materials."

Not surprisingly, some marketers too have chosen to see the population in terms of skill levels rather than education. Jack Trout of Trout & Partners, a marketing strategy firm, sees the people running high-tech computer and manufacturing systems as the hottest target group for high-end consumer goods. "I suspect that this group of skilled workers is one of the bigger things driving the economy," Trout says. "They are big earners and big spenders. Emotionally the group is moving up. In terms of self-estimation, they are skilled professionals."

And some of those who feel most professional may take that attitude all the way back to college. As Birch puts it: "I would love to go back to school the tuition reimbursement program on my job."

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