Industry Overview

Education has always been a national priority in our country because our democracy and economy require quality education to be successful. From the time of the first Congress until today, our legislators at the national level and in each state have done a great deal to ensure the American people have access to top quality education. However, it goes well beyond the activities of our legislators to the core attitudes of our citizens. The belief in and desire for education are ingrained into the very fabric of our people. A recent count by the US Department of Education noted that some 73 million persons were formally enrolled in American elementary, secondary and postsecondary institutions. (1) In the past 10 years, that enrollment has grown significantly and projections suggest that it will continue on a growth curve at least through 2015.

A close examination of the current and projected numbers reveals an exciting future for the education industry. With more people attending more institutions, the need for support services at all levels of education is expected to grow.

Elementary and Secondary Education

Schools across the country, both public and private/faith-based, enrolled a total of 55 million students in 2006, with enrollment projected to increase almost six percent by 2015. (1) (2) Enrollment in high school continues to increase and therefore so do the number of high school graduates. Not only is high school enrollment growing and but the dropout rate is shrinking as well. Furthermore, there is clear evidence that high school students are more serious about the courses they are taking and more than half of them meet or exceed the minimum requirements established for attending college. Only 10 percent met this minimum just 25 years ago.

College and University Education

A recent report from the Department of Education indicates that nearly 18 million people are enrolled in some form of postsecondary education. This is expected to grow by up to 15 percent by the year 2015. (1) Growth is projected both in the traditional college attending years (those 18-24) and among older adults as well. We are anticipating the largest high school graduating class in the history of the United States, and the projections are that we will see a 5 percent increase by 2015. The graduate rate increases even more for private high schools. This comes at no surprise -- the benefits of education beyond high school are well documented. The U.S. Department of Labor has acknowledged for years that college graduates earn more than workers who have less education. In fact, one report suggests that over a lifetime of employment, a college graduate can earn as much as 60 percent more than a non graduate. (4) Not only do graduates enjoy higher returns on their education investment overall, but they experience fewer problems with unemployment. A number of additional non-monetary benefits are also proven to help those who are college educated.

The transition from high school to college is not an easy one. Issues that high school students face, in increasing numbers, include deciding on a career path, finding the right college that offers a program in that academic area, submitting the application and getting accepted and ultimately financing that education. Furthermore, from the institution's perspective, knowing what academic programs to offer and finding just the right students for those programs are both challenges as well. These factors and others suggest that there is a growing need to help high school students in their transition to college and help colleges and universities identify those potential students who appear to have the best chance for success.

Education Planning

The Web has put more information at our fingertips, and therefore in some ways made planning an education more convenient. Yet to most families it seems that there is so much information that it's difficult for them to make a decision. Once the family has made that important decision to send their child to a private or faith-based elementary or secondary school, the next challenge is often finding just the right school and then gaining admission. The task is even more difficult when making the transition from high school to college because it can involve a career decision and is less geographically limited. At a number of key points in this process there are ways to step in and help families find just the right institution.

From the institution's perspective, finding students that fit their success profile can be equally challenging. The availability and quality of online education along with ease of travel have all but erased geographic boundaries. Placing information on the institution's Web site is just one solution. Colleges and universities need to search for those who have an interest in the academic programs they offer.

Education Financing

The investment in a quality education can bring many positive returns. For this reason, the American people are very willing to make that investment in their future and the future of their children. College savings plans are enjoying increasing popularity. Monthly payment plans at all levels of education are becoming widely accepted and used. Requesting financial assistance in the form of scholarships, grants and loans is common place.

Looking first at college savings plans, the 529 college savings plan enables families to save money in a tax-deferred account to pay for education in the future. These are state-sponsored investment programs that have grown in ten years to an estimated investment size of well over $90 billion. There are other savings options, but the tax benefits and returns of the 529 plans have made this particular method of saving for college extremely popular.

Payment plans are offered by many colleges and universities. They're especially popular among community colleges. Over the course of a semester, a year or even the life of an academic program a payment plan is established allowing the student and/or his/her family to make monthly cash payments to help meet the cost of postsecondary education. Each year more and more students and their families are taking advantage of monthly payment plans.

Loans to help meet the costs of education are very common as well. For more than 40 years, the Federal Family Education Loan (FFEL) program has helped make higher education possible for millions of students. The FFEL is a public-private partnership in which lenders make federally guaranteed student loans in partnership with school financial aid offices. The foundation of the FFEL program is choice. Schools can choose among numerous loan providers to determine the program and loan products that are right for them and their students. This choice has created a competitive marketplace for student loans with students, parents and schools as the beneficiaries of this competition. The FFEL is the most efficient and effective way to provide student loans. During the 2005-06 academic year, more than 6.5 million students and their parents were able to pursue their educational dreams through the FFEL program. Other types of loans, including private loans outside the FFEL program, are also available.

Summary

One of the keys to the American dream is education. A good education is a valuable investment of time, effort and money. It's clear, from the research, that the education seeking public will continue to value quality education at all levels and that there will be a growing need for services to help people plan and finance their education.

(1) Digest of Education Statistics 2006, National Center for Education Statistics, U.S. Department of Education, July 2007, NCES 2007-017
(2) Projections of Education Statistics to 2015, National Center for Education Statistics, U.S. Department of Education, September 2006, NCES 2006-084
(3) Digest of Education Statistics: 2006, National Center for Education Statistics, U.S. Department of Education, July 2007, NCES 2007-017
(4) Occupational Outlook Quarterly, Bureau of Labor Statistics, United States Department of Labor, Winter 2004-05