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Return on educational investment higher with 'non-traditional' learning: study

Return on educational investment higher with 'non-traditional' learning: study

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College degrees always deliver return on investment, and technical and IT degrees have the highest returns.

Do non-traditional education programs -- delivered online, off-site, likely to an older student population -- pay off greater in the end than traditional four-year college programs?  New research suggests this is the case.

Dr. Tracey Wilen-Daugenti of Apollo Research Institute: For today's workforce, education is the perk that keeps on giving.

The Apollo Research Institute, an educational think tank, has pulled together some calculations on "return on educational investment," or ROEI, which finds that non-traditional students recoup twice their educational investment than traditional, on-campus students.

Apollo Research is associated with the University of Phoenix, a private, online educational provider, so, accordingly, the results should be viewed with this in mind. Nevertheless, the results point to the nature of non-traditional students: they are older, more goal-oriented and likely approach their studies more seriously.  Plus, most are already in the workforce.

As the prelude to the study points out: "today nearly 3 out of 4 undergraduates share characteristics of nontraditional students: financially self-supporting individuals who tend to be 23 years or older and balance work and family responsibilities while attending school. Traditional students, by contrast, tend to forfeit 4 years of income and work experience while attending college."

The study's researchers analyzed published 2010 salary data and educational costs to measure the ROEI of specific academic and professional disciplines for traditional and nontraditional students. It's not clear, however, how the researchers arrived at ROEI -- presumably, it is based on total lifetime earnings made as a result of having a bachelor's degree versus a baseline of earnings without such a degree.

It's worth noting that bachelor’s degrees in all disciplines analyzed by researchers demonstrated positive ROEI:

  • Business: Traditional programs: 15% -21% ROEI; Nontraditional programs: 28%-43% ROEI.
  • Computer science/management information systems: Traditional programs: 16%-24% ROEI; nontraditional programs: 26%-49%.
  • Elementary education: Traditional programs: 9% ROEI. Nontraditional programs: 18% ROEI.
  • Engineering: Traditional programs (depending on specific fields -- e.g., petroleum, chemical, computer, civil or engineering technology): 19%-29% ROWI. Nontraditional programs: 34%-53% ROEI.
  • Healthcare support: Traditional programs: 14% ROEI. Nontraditional programs: 26% ROEI.
  • Nursing: Traditional programs: 18% ROEI. Nontraditional programs: 36% ROEI.

What is the purpose of such a study, other than to promote enrollment in online college programs?  The researchers point out that with many critical shortages now emerging in technical fields, both employers and employees could make a good business case for getting a degree. As reported previously here at SmartPlanet, many companies are now desperately seeking technical skills, but at the same time, stingy about supporting training for current employees that could fill these skills gaps:

"Adding a degree can broaden career options and boost earning power. Some employees may downplay the idea of fitting even part-time classes into existing work and family commitments. Others may overestimate the cost of courses and/or fail to realize the financial return they can earn on their educational investment—especially for IT-related degrees."

Ultimately, educational attainment may be the best and most cost-effective recruiting tool available to companies. As Dr. Tracey Wilen-Daugenti writes in FierceCIO: "To attract top talent, hiring managers should consider eliminating gimmicky and -- most likely -- ineffective recruitment tactics such as offering new gadgets as sign-on incentives. Instead, they should empower workers to make data-driven decisions by providing information about the specific ROEI of IT-related degrees and their earning potential."

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Joe McKendrick

Contributing Editor

Joe McKendrick is an independent analyst who tracks the impact of information technology on management and markets. He is a co-author of the SOA Manifesto and has written for Forbes, ZDNet and Database Trends & Applications. He holds a degree from Temple University. He is based in Pennsylvania. Follow him on Twitter. Disclosure