[NOTE: this post serves as a model/example for students in my summer course, but I am also happy to share it with the public through this blog.]

A recent article in Inside Higher Ed. features Ohio’s Eastern Gateway Community College, which “has grown its online programs rapidly in the last few years, with most of its roughly 20,000 students now enrolling online, and from out of the state of Ohio.” (emphasis mine) The article includes testimony about Eastern Gateway provided to the Ohio legislature by Jack Hershey, President of the Ohio Association of Community Colleges.

While the State of Ohio has long provided funding to the state’s public universities to help educate non-Ohioans, it has been done for students who physically move here to attend college with the hopes that they will remain in in our great state and become valuable members of our workforce after graduation. That is not the kind of student Eastern Gateway’s online program is attracting. Unless this loophole is closed, students in New York City, Tacoma, San Francisco, and Honolulu could take an online class without ever stepping foot in this state, and Ohio taxpayers would be on the hook to help subsidize their education.

What Eastern Gateway Community College is doing not entirely unique. Public colleges and universities are increasingly seeking enrollment and revenue growth by recruiting and attracting more out-of-state students who pay higher tuition than in-state students. Whereas until now the focus has been largely on attracting these students to campus, the logical next step is the Eastern Gateway approach: attract out-of-state students to distance education programs. “Why pick up everything and move to another state when you can do a whole program of study from your home (state)?” This approach has some constraints, though, including states and institutions that are limited by caps on out-of-state enrollments. Those caps, like the “25% rule” here in Virginia, are largely justified by the sort of language Hershey used in his testimony to the Ohio legislature. That is, if taxpayers in a given state are going to subsidize public higher education, they want to know that they are helping the people of that state.

These same sorts of issues are in play where states and public universities are trying to become national or even global distance education providers. There was a good bit of news recently around  the University of Massachusetts trying to create a new online college that will be “…a national competitor in educating adult learners.” The key there is the idea of being a national competitor; the goal is not just to better serve the people of the Commonwealth of Massachusetts. 

And, UMass is not alone. Thus, as we move into the realm of enrolling out-of-state students in distance education programs, there are other legitimate concerns and questions to be asked, including:

And, most importantly, is this pursuit worthy? Is it wise and/or sensible for UMass to seek to become a national provider of distance education at this stage of the game?

To explore the current state of affairs around out-of-state students in distance education programs, I used data from the Integrated Postsecondary Education Data System (IPEDS). For this exploration, I only included students who are enrolled exclusively in online courses. IPEDS also captures students who are in some (but not all) online courses, but if my interest is in distance education across state lines, it makes the most sense to focus, for now, on fully online students. Also, I limited the dataset to 4-year public colleges. This eliminates institutions such as community colleges like Eastern Gateway, and it also eliminates some of the biggest players in the field of distance education including private for-profit institutions like the University of Phoenix and private non-profit institutions like Liberty University and Southern New Hampshire University. 

[NOTE: All of the graphs and tables were built in Google Data Studio; they can be enlarged to full-screen by clicking on the bottom-right corner. They are also generally interactive, occasionally allowing you to filter for particular institutions and/or states.]

Total enrollments in- and out-of-state over time

This exploration begins by looking at the big picture. IPEDS collects data students enrolled exclusively in distance education courses as well as students enrolled exclusively in distance education courses and are located in the same state/jurisdiction as the institution. Those data are depicted over time in Figure 1 below. The graph shows that the share of in-state, fully online students has grown at about the same pace as the growth in total fully online students.

Figure 1. Fully online enrollments (total and in-state) by year.

Figure 2 is a slightly different view of those data; it shows the share of total fully online enrollments that are out-of-state. The early emerging story we see from these figures is that the total number of students enrolled exclusively in distance education courses grew steadily from 2013 to 2017 and that growth is mostly driven by *in-state* students. That is to say, the growth in the total number off students enrolled exclusively in distance education courses (37% growth) has significantly outpaced the growth in the number of students enrolled exclusively in distance education courses who are enrolled in an out-of-state institution (28% growth).

Figure 2. Fully online enrollments (total vs. out-of-state) by year.

Out-of-state distance education enrollments at the state level

Figure and Figure 2 allow you to filter by state (or institution), but for a cleaner look, Figure 3 is a map of the states colored by the percentage of fully online students in 2017 that were from out-of-state. The darker the shade of red, the higher the percentage of fully online students that were from out-of-state in 2017. Arizona had the highest percentage of fully online students from out-of-state (63%), but as we will see shortly, that statistic is skewed by the presence of Arizona State University, a Goliath in this space among 4-year public institutions. In Kansas and New Jersey, over half of the fully online students are from out-of-state,

Figure 3. Percentage of fully online students who are from out-of-state, by state (2017).

Table 1 below shows which states have seen the highest growth in the percentage of fully online students who are from another state. Fewer than half of the states have seen any growth in the percentage of fully online students from out-of-state from 2013 to 2017. Also, on a percentage basis, Rhode Island and Vermont are in the top three, but there are relatively few fully online students enrolled in institutions in those states. The three states worth noting here are South Carolina, Wisconsin, and Louisiana, where the percentage growth in fully online students from out-of-state was greater than 10%, with the result being that more than one-quarter of all fully online students in those states in 2017 were from out-of-state.

Table 1. % growth in fully online, out-of-state students from 2013-2017, by state.

Out-of-state distance education enrollments at the institution level

Drilling down even further, and to unmask the outliers such as Arizona State University, we can further disaggregate the data to the institution level. Figure 4  below is a scatterplot of the top 250 universities in terms of overall fully online enrollments. Along the x-axis is students enrolled exclusively in distance education courses that are *in-state*. Along the y-axis is the total number of students enrolled exclusively in distance education courses. The red line is the trend line; the institutions that are considerably off of the trend line are, therefore, worth noting. The University of Maryland – University College (UMUC) looks like an outlier, but, proportionally, they are not far off the trend line. In 2017, they had the highest number of fully online students (46,736), but 84% of those students (39,096) lived in Maryland. 

Figure 4. Fully online, total vs. in-state (2017), by institution.

The clearest outlier is Arizona State University (ASU). In 2017, they had 30,141 fully online students, and only 24.5% of those students (7,395) lived in Arizona. Three other notable outliers are Penn State – World Campus, Colorado State – Global Campus, and Thomas Edison State University. All three of these institutions enrolled over 11,000 fully online students in 2017, and more than half of those students were from out-of-state. Penn State – World Campus and Colorado State – Global Campus share a few key characteristics. Both are online extensions or arms of the larger university; that is, they are large, somewhat independent, dedicated distance education units. They were both early entrants into the distance education space, offering distance education courses and programs for decades. Arguably, they were distance education pioneers that paved the way for institutions like UMUC and ASU. Thomas Edison State University (TESU) is a unique and fairly well-known institution in the distance education space. It is a majority-online institution located in New Jersey that serves mostly adult learners. Though their Wikipedia page says that TESU is “a majority-online institution that serves the state’s adult population,” the IPEDS data show that more than half of TESU’s students do not live in New Jersey. 

Two other institutions are notably distant from the trend line, though on the other side of the line from ASU and the others mentioned in the paragraph above. The University of Central Florida (UCF) and Florida International University (FIU), both located in Florida, enrolled over 10,000 fully online students in 2017, with 97% and 94% of those students residing in Florida. Both institutions, especially UCF, are well-known and well-respected institutional players in the distance education space, and they have clearly chosen to serve almost exclusively students residing in their home state. 

To dive deeper into the story, one might ask which institutions serve the highest percentage of fully online students from across state lines. Table 2 provides answers to that question. Rutgers University in New Jersey reports that 100% of their 2,255 fully online students reside in a state other than New Jersey. The others in the top 5 serve relatively small numbers of fully online students. Here, though, at #6 is Georgia Tech. Eighty-three percent of the 7,135 fully online students served by Georgia Tech reside in a state other than Georgia. Unquestionably, those numbers are driven by the highly publicized online masters in computer science offered in partnership with Udacity and AT&T. That MOOC-based program attracted large numbers of students from across the country in a very short period of time. 

Table 2. % in fully online students, by institution (2017).

There are some institutions that have greatly increased the percentage of fully online students that they serve who reside in a different state than the institution. That said, only 14 institutions have grown the percentage of their fully online, out-of-state enrollments by 15% or more from 2013 to 2017. Table 3 lists the institutions, sorted initially by the percentage growth. [NOTE: to eliminate some of the noise when displaying percentages, the table is limited to only those institutions with over 1,000 fully online students in 2017.]

Table 3. % growth in fully online, out-of-state students, by institution (2013-2017).

Summary / Conclusions

Recently, Goldie Blumenstyk of the Chronicle of Higher Education wrote about distance education as an overlooked lever of educational policy, particularly at the state level. I am not sure I agree entirely with that framing, but in the article, Blumenstyk linked to a color-coded graphic of “winners and losers” presented at the Eduventures Summit in Boston by Richard Garrett.

This map compares the number of residents enrolled in online programs at out-of-state institutions to the number enrolled online in-state. In other words, it helps us see which states are losing larger proportions of in-state students to institutions across state lines. Per Blumenstyk: 

In eight states the number of residents enrolled in an out-of-state online program exceeds the number enrolled online in-state. And in all but 17 states the number of residents enrolled online at out-of-state colleges is at least half the number of residents enrolled online at an in-state college.

That is the case even though surveys, including one released last week by Learning House and Aslanian Market Research, show that online students prefer colleges within 50 miles of where they live. Notably, the out-of-state trend was less prevalent in states with a high-profile option, like New Hampshire (SNHU), Arizona (Arizona State University), and Florida (the Universities of Central Florida and Florida).

There’s nothing wrong with enrolling out of state. Indeed, over the past few years, policy makers have been putting a ton of energy into the red-tape-cutting organization NC-SARA,to facilitate this kind of interstate flexibility for students.

But as Garrett noted, when mega-universities like SNHU and Western Governors University, both private nonprofit institutions, are drawing away so many students, and others, like the University of Massachusetts, are looking to grab their own share of the pie, that should be “a wake-up call to states” to start thinking strategically about using online education to further their needs and goals.

I tend to agree with Blumenstyk here, and I think all of the data shared above support the idea that if public institutions of higher education are looking to grow enrollments and revenue through distance education, their focus should be on in-state students more than out-of-state students. Very few public institutions have been successful in growing enrollments dramatically by recruiting and enrolling students from across state lines. Figure 5 below is a representation of the “typical” situation for public institutions between 2013 and 2017. On average, schools enrolled 1,244 exclusively distance education students in 2017, and only 17.7% of those students were from across state lines. Furthermore, that percentage of out-of-state fully online students has dropped over the last handful of years. The median institution is about half the size of the average institution, likely due to the fact that there are outliers like UMUC and ASU that are skewing the mean up. The median institution, in 2017, had 643 fully online students, fewer than 10% of which were from out-of-state. 

Garrett’s “winners and losers” graphic that Blumenstyk shared points to states that are “leaking” residents to online programs in other states. Not long ago, I took a look at this situation for Virginia, where I work and live. Using data from NC-SARA, I found that in 2016, there were almost 35,000 Virginia residents involved in distance education at out-of-state institutions. We don’t know the extent to which they’re enrolled (single courses? A whole program?) or at what level (undergraduate? graduate?), but we can see which out-of-state institutions are enrolling the most Virginia residents. Table 4 below only lists the top 7 states in which institutions serving Virginia residents are domiciled, and the top 3 institutions within those states.

Table 4. Virginia Residents enrolled in out-of-state distance education (2016).

VIRGINIA RESIDENTS ENROLLED IN OUT-OF-STATE DISTANCE EDUCATION
STATE ENROLLMENT TOP UNIVERSITIES
WV 8899 American Public University System (8588) (for-profit)
West Virginia University (108)
University of Charleston (71)
AZ 8788 University of Phoenix (5718) (for-profit)
Penn Foster College (1480) (for-profit)
Grand Canyon University (1127) (for-profit)
MN 3944 Walden University (2282) (for-profit)
Capella University (1519) (for-profit)
Rasmussen College (58) (for-profit)
CO 1985 Colorado Technical University (695) (for-profit)
College for Financial Planning (295) (for-profit)
American Sentinel University – Aurora (257) (for-profit)
NH 1625 Southern New Hampshire University (1625) (for-profit)
IA 1575 Kaplan University (1575) (for-profit)
AL 1508 Columbia Southern University (1073) (for-profit)
Troy University (197)
The University of Alabama (80)

Notice anything? It’s almost all for-profit institutions domiciled outside of Virginia, to the tune of probably close to 30,000 of the 35,000 Virginia residents involved in distance education enrolled in for-profit schools. For sure, many of these students are military personnel, as we have some big military bases and I’ve seen firsthand how aggressively the for-profit providers recruit military personnel to their programs. But, there are relatively few Virginia residents that are enrolling in distance education programs at out-of-state programs.

One last table to drive home a point about distance education across state lines. Table 5 below lists ALL of the 4-year public institutions that had over 5,000 exclusively distance education students in 2017. Of the 776 4-year publics, only 24 (3%) had over 5,000 fully online students in 2017. Only 9 of those 24 institutions had more than half of their fully online students from out-of-state. Finally, if those institutions have grown their total enrollments of fully online students, with the exception of three institutions (Georgia Tech, Arizona State, and University of Texas-Arlington), less than 10% of that growth has been from out-of-state students.

Table 5. % growth in fully online, out-of-state students, by institution (2013-2017) (institutions with 5,000+ fully online students).

Returning to the recent UMass announcement referenced earlier… is it wise and/or sensible for UMass to seek to become a national provider of distance education at this stage of the game? That question is not just relevant for UMass. About 18 months ago, Louisiana State University announced similar goals. “More than 30,000 students attend classes at LSU’s Baton Rouge campus and Provost Richard Koubek wants to have just as many online students by 2025.” According to the article linked above, in 2017, LSU-Baton Rouge enrolled just 764 students online. In other words, they want to go from less than one thousand fully online students to more than 30,000.

The story the data above tell suggest that UMass and LSU are facing very long odds if they are looking to become a national provider of tens of thousands of fully online students. 

  • Only 24 (or 3% of) 4-year public institutions enrolled 5,000 or more fully online students in 2017. Only 9 institutions enrolled more than 10,000 students. 
  • Trend lines suggest that the vast majority (more than 80%) of fully online students in 4-year publics stay in state for their studies. Very few institutions have been able to grown fully online enrollments through recruiting and enrolling out-of-state students.
  • The only public institutions that have been successful in enrolling out-of-state students are either: (1) those that have standalone distance education units and have been in distance education for a long time (see e.g. Penn State – World Campus and Colorado State – Global Campus), or (2) have taken unique approaches like Arizona State’s partnerships with companies such as Starbucks or Georgia Tech’s partnership with Udacity and AT&T, or (3) targeted military personnel (UMUC and Fort Hays State). 
  • There may be “leakage,” residents that are enrolled out-of-state than can be recaptured; that is a market worth considering, but in-state competition is only increasing as more and more institutions are growing capacity to offer courses and programs from a distance. 

Many 4-year publics want what Southern New Hampshire has or what Liberty has or what Arizona State has. The competition is only going to become more serious. Their odds are very long…