This website provides an introduction and the background for a sustainable business model for a for-profit postsecondary education organization. Through careful analysis of various data, a selection of programs offering training in high-demand occupations and in green-field MSA's have been identified. Further, a team of professionals with a track record of growth and success have been identified and assembled. The result is a business model for a for-profit postsecondary education organization that will result in sustainable returns on investments.
The process began with an evaluation of the for-profit postsecondary education's current and future role in providing America with an adequate and sustainable labor force. The evaluation continued with an assessment of labor demand in specific occupations, in specific regions versus the capacity of America's postsecondary institutions to provide the necessary training to fulfill the demand. We have included a detailed explanation of the methodology by which programs and regions were chosen. Areas analyzed include:
- The projected state of the American Labor Market over this decade
- Projected growth rate of occupations by educational/vocational training
- Regional analysis of those occupations (at the MSA level)
- Analyzing the relationship between the regional growth rate of those occupations to the rate in which students graduating with the skill set required for those occupations
- Evaluation of existing institutions for possible acquisition
Government indicators and projections along with credible industry sources are used to analyze for-profit educators' current and future roles in American postsecondary education. Results show that for-profit postsecondary education will play crucial and expanding role in meeting America's demand for skilled workers.
The case for for-profit postsecondary educational institutions
Occupations requiring some post-secondary education are expected to increase to 32.1% of the total workforce by 2018. A 2010 study by the Georgetown University on Education and the Workforce predicts that by 2018 the US postsecondary system will have produced three million less college graduates than is demanded by the labor market. For-profit institutions graduate students more quickly than their non-profit competitors. The administrative and infrastructural approach is acutely tailored to student training. These elements allow for-profits to graduate students at a greater rate and with less strain on tax revenues than non-profit, traditional institutions. Further, for-profit education more efficiently serves the needs of student demographics that are underserved by public and private non-profit postsecondary sectors: students older than 25, high-risk students, and military personnel/veterans. They also more effectively serve those students who have "fallen through the cracks" at non-profit, traditional institutions.
This business model focuses on postsecondary certificate and associate's degree programs. Occupations requiring an associate's or certificate degree are expected to outpace overall employment growth from 2010-2020. The rationale underlying the methodology of program and region selection taps into the strengths of for-profit postsecondary institutions: responsiveness to market demand and efficiency in educational delivery. This model avoids the oversaturated bachelor's and post-graduate sector, where programs compete directly with most public and private non-profit institutions (and the large, publicly traded for-profit institutions). Rather, the model offers a variety of vocational and associate's degree programs that are cost effective to deliver, attract full-time students, educate and graduate students at a higher rate than traditional institutions and assist the graduates in achieving their goal of a career in high demand careers.
The methodology of selecting programs and locations
The main focus in program selection was unearthing programs offering occupational skills for which demand currently exceeds supply in the labor market and will continue to in the future. Programs were selected based on growth projections made by the Bureau of Labor Statistics (% growth in employment in the occupation, 2010-20). Only those occupations expected to experience substantial gross growth have been selected. The high-growth occupations were further narrowed to those whose expected wage would support the student's investment in their education. Those occupations are focused in three categories:
- Healthcare Occupations: Nursing, Medical and Clinical Technicians, etc.
- Trade Occupations: Industrial Machinery Mechanics, Plumbers, etc.
- Information Technology Occupations: Network and Systems Administrators, Computer Systems Analysts, etc.
Another tenet of successful for-profit institutions is fiscal flexibility – ensuring that only profitable programs are offered. Programs requiring viable capital expenditures and relatively low operating costs have been targeted.
Regions were selected based on the projected growth of the selected occupations. The regions were first narrowed by state. The result is 6 states where the selected occupations meet the standards set forth previously. Next, the states were narrowed to specific metropolitan statistical areas (MSA's) using the same criteria outlined earlier.
The MSA selections were then further narrowed based on the existence of institutions offering programs within the area. The methodology compared the amount of graduates from those institutions to the demand for the related occupation within each specific MSA. If the number of graduates for a given occupation at existing institution programs were greater-than the projected demand, the program for that MSA was considered "saturated" and was removed from the selection. If the number of graduates for a given occupation at existing institution programs were less-than the projected demand, the program for that MSA was considered "viable" remained within the selection. MSA's with a sufficient number of "viable" programs for the three categories above were considered viable MSA's and remain as the target MSA's for the plan.
The MSA selections were then ranked. The ranking was based on the number of viable programs and the amount with which demand for graduates exceed current supply of graduates. The ranking was then further refined to enable clustering of MSA's for operational and managerial considerations.
The MSA's were then analyzed for existence of institutions for acquisition. The evaluation was based on the following criteria:
- Is the institution Title IV eligible?
- Is there accreditation in place to support the three program categories?
- Institutions with a limited student population (< 300 students) are preferred
- Institutions with few campuses (< 3) are preferred
- Institutions currently offering (at least some of the) programs from our selection are preferred
Assembling a team of professionals
The most important asset of any organization is its people. An educational institution is no different. The proposed leadership team has been specifically selected for their experience, skill set, integrity and ethical approach to education. This group of professionals brings with it a combined 79 years of proprietary education experience and more that 100 years of leadership experience. Each has demonstrated an ability to think "outside of the box" and has flourished in high-growth environments. Most importantly, they understand the need for a highly ethical and compliant organization. Without exception all have guided students from the point of first contact, through their education and ultimately into career placement and beyond.
A team of leaders has been identified and assembled to lead the following specialties:
- Executive and Financial Leadership
- Compliance (Title IV and Accreditation)
- Academics
- Operations (Inclusive of Student Placement)
- Admissions
- Marketing
The role of American proprietary education can in no way be discounted in the upcoming years. Government statistics as well as the current and looming landscape of non-traditional students demonstrate a growing gap between prepared individuals and job trade opportunities. Furthermore, analysis of vocational-based employment on any plane, whether it is future job growth, programmatic demand or geographic strength, strongly suggests opportunity for those that are innovative and flexible enough to decisively engage this market. However, this avenue should only be participated in with a concerted and systematic approach to be assured that the programs deployed are viable and located in specific MSA's where longevity of the business model is assured. The methodology, described herein and carefully adhered to, not only confirms larger known employment and geographic trends but has also uncovered previously undiscovered areas for prospect. Equally important are the respective roles of executive team members. The collective, demonstrated experience of these successful individuals coupled with alignment and integrity allows for a "boots on the ground" approach with an eye towards immediate success. Cohesively fastening these three distinct factors together, it should come as no surprise that confidence can be engendered in supporting a post-secondary educational business endeavor.
The prevailing conclusion is that viable programs that are located in high demand MSA's and operated by professionals with a track record of growth and success will result in sustainable returns on investments for years to come.
For more information, please contact:
Eric Chiusolo
Career Attainment, LLC
21163 Newport Coast Drive, Suite 514
Newport Coast, CA 92657-1123
949.335.5890
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