Jamie P. Merisotis, President, Lumina Foundation for Education
Remarks to the Higher Education Group, Washington, D.C.

Thank you for giving me the opportunity to speak here today. Six weeks ago I left DC to take on the challenge of leading the nation’s largest private foundation focused exclusively on higher education access and success at a national level. Already, life has changed a lot, but I am adjusting to my new role. Almost overnight, I went from being a grant seeker to a grant maker and from being a policy analyst—and an advocate—to a supporter of diverse policy perspectives.

But many of the same values that drove the work I oversaw and performed as president of the Institute for Higher Education Policy are the same values that define our work at Lumina Foundation. Chief among them is the fundamental belief that higher education offers tremendous public and private benefits for our society. We know that workers who have gone to college tend to earn more, save more and produce more. They are more satisfied with their lives. They enjoy better health, and they live longer.

College graduates don’t just require fewer public resources to care for—they pay higher taxes. If we produce more college graduates, this win-win scenario continues. People live better. Crime is lower. More people have jobs, and fewer people are on welfare.

The benefits of more people graduating from college don’t end there. The more educated people are, the more likely they are to vote, volunteer their time for worthy causes and donate to charities.

In short, by investing in our fellow Americans who might not otherwise go to college, we are investing in our united future and well-being. It’s not simply that it’s the right thing to do, but that it is in our collective economic and social self-interest to do so. These important public and private benefits of higher education represent critical pillars in the foundation of an innovative and qualified national workforce, a secure economy, and a robust democracy.

The current generation faces a radically different future in the labor force, one that mandates some form of postsecondary education for virtually all of the careers that lead to higher wages, more job security, and a more prosperous life. I was thinking about this evolution of work when I came across an article last July in The Wall Street Journal that neatly illustrates the challenge for today’s worker, and by extension, for American higher education. The article described the difficulty banks are having in finding and hiring tellers. It seems that bank tellers traditionally have been high school graduates. It was the kind of solid, respectable job that could help support a middle-class family and a job that didn’t require any college. Until recently, banks expected tellers to be eventually replaced by technology—in this case, ATMs—just as we’ve seen with other lower-skill jobs.

But then a funny thing happened. Retail banking became very important to banks, and they discovered their tellers are the front line of contact between banks and their customers. Banks need tellers to listen and respond to what they hear from customers—suggesting home-equity lines of credit, for example, or referring customers to financial-planning services offered by the bank. In other words, banks need tellers to be able to gather information from a variety of sources, synthesize it and make autonomous judgments about what to do with it. On top of all that, they need tellers to be able to communicate and work well with others. Banks are figuring out that people with only high-school diplomas are simply not up to the demands of these jobs. It’s important to note that it is not a specific set of technical job skills the banks need. Rather, tellers need the kind of abstract reasoning, problem solving and communication skills that a college education has traditionally supplied. According to The Journal, banks are now looking to community colleges—not high schools—for their tellers.

This one example describes in a nutshell a trend that is happening throughout the global economy. The consequences have become the focus of our work at Lumina Foundation for Education. The trend is that more and more people with educations beyond high school have become critical to the smooth functioning of the US economy and to the ability of individuals to participate fully in society. The transformation of work which the example of the bank teller so aptly illustrates is happening throughout the labor force in response to pressures to increase quality, value and productivity. As New York Times columnist Thomas Friedman has made clear, the marketplace for goods and services is now global, and the only way to survive—whether you are an individual or a nation—is to increase skills and knowledge to better compete in a dynamic environment. This means that we absolutely must increase the number of Americans who have access to—and are successful in—higher education.

The challenge requires us to do two things at once: accelerate progress so that more Americans gain access to a high quality postsecondary education and ensure that what they learn aligns with the knowledge, skills, and abilities to function in a rapidly changing economic and social context.

Lumina Foundation grapples with these challenges of access, attainment and mastery. In my view, private philanthropy has a unique role in helping our nation meet these challenges. While no foundation has the resources to tackle what are enormous, complex and interconnected problems within American higher education, I think we can make a significant difference. Last year, Lumina Foundation ranked as the 39th-largest private foundation in total assets among the more than 7,000 private foundations nationally. What is interesting, however, is that Lumina Foundation largely stands alone among the top 50 in terms of the specificity of its mission—expanding success beyond high school.

Many of our larger peers have richly diverse missions that cover an array of topics from the environment to global health care. My hope is that Lumina Foundation, through its investments, can generate a great deal of change in the field because we target resources toward a narrow mission and have access to the partners and intermediaries who can reach large numbers of students and higher-ed institutions. And that is exciting indeed, because no philanthropic organization has ever made the kind of sustained commitment Lumina Foundation is making to this important work.

How should we invest? To be successful, I think a foundation needs to mirror the curiosity and dedication it expects from those in whom it invests. How we go about our work is as important as the work itself. For that reason, the Foundation should search for answers in the places where it hasn’t done enough looking, taking a 360-degree inquiry approach to problem solving instead of focusing on intriguing and sometimes-spectacular examples that often cannot be brought to scale. One way of doing this, I think, is to look at institutions that traditionally have not been considered exemplars.

For example, I have come to believe that no group of institutions does more to promote the dual goals of investing in students who might not otherwise go to college and ensuring accountability to those students than Minority-Serving Institutions (MSIs). Tribal Colleges and Universities, Hispanic-Serving Institutions, and Historically Black Colleges and Universities and other predominantly Black institutions, which collectively are referred to as MSIs, represent some of the nation’s most important but underserved postsecondary education resources. Combined, more than 2.3 million students are educated by these institutions, or about one-third of all students of color. These numbers have been growing rapidly in recent years as increasing numbers of students of color make it to college.

Given demographic projections that show these communities are the fastest growing in the nation, it is clear that MSIs must be recognized as leading voices for underrepresented populations that are the backbone of our future workforce development. These populations find that MSIs offer unique educational experiences that foster cultural values and traditions, promote civic and community responsibility and produce citizens who are attuned to the increasingly diverse country in which we live.

MSIs educate more students of color in many areas of national need than mainstream institutions. Many educational leaders are surprised to learn that nearly one-half of all teacher-education degrees awarded to African Americans, Latinos and Native Americans in U.S. higher education are conferred by MSIs. These institutions also make major contributions to our nation’s workforce in the areas of Science, Technology, Engineering and Mathematics (STEM) despite significantly lower levels of financial support than other institutions.

From recent research we know that Historically Black Colleges and Universities, Hispanic-Serving Institutions, and Tribal Colleges and Universities do measurably better than other institutions in engaging and retaining students in some key areas. These include providing students with supportive learning environments, close interaction with faculty and stronger community connections that lead to higher forms of civic engagement during and after college.

This deep engagement of students has important lessons that need to be shared and replicated—not just by other Minority-Serving Institutions—but by all colleges and universities. For instance, might we find some inspiration for our concerns about rising costs and prices by looking at how schools like these deliver a quality education? In other words, these institutions, which serve large numbers of the populations who need greater access and success, should be seen as sources of knowledge and inspiration. They are not just places where we apply solutions that have been developed elsewhere. Places that already are providing opportunities for the populations we hope to target with our investments are a good place to look for scalable solutions.

We need to be aggressive and creative in looking for new ideas. We are looking at an enormous shortage of skilled workers in the not-too-distant future. In recent years we have witnessed companies recruiting heavily overseas in critical workforce sectors such as information technology. By 2020, we will be looking at a gap of about 14 million people to fill jobs that require a college education. Unless we plan to radically alter our immigration policies—an unlikely scenario in the current political context—we will need to significantly increase the number of people who go to college. This is our best hope in terms of keeping the US economically relevant and competitive.

The international comparative data clearly show that we are falling behind other developed countries when it comes to increasing higher-education opportunity. Among the oldest working-age group—those 55 to 64 years old—the United States is still No. 1 in the proportion of its national population with degrees. Canada is close behind, followed by several Scandinavian countries. In effect, this age cohort represents what our higher-ed system looked like a generation ago.

But the picture changes quite dramatically when we look at the youngest adult age group—that is, the generation entering the labor market. When examining the proportion of 25 to 34 year olds who have college degrees we rank 10th among developed countries. Canada … Japan … Korea … several of the Scandinavian countries… All are in front of the United States. Several other European countries and Australia are poised to soon overtake us.

In thinking about international comparisons, there is of course an important caution. Our rallying cry as a nation should not be Beat Finland!, as one of my Lumina colleagues likes to say, tongue-in-cheek. Instead, we need to recognize that while the rest of the world is roaring ahead with investment in higher education as a critical national goal, the U.S. is neither moving forward nor backward, but simply vibrating in place, maintaining essentially the same system of higher education that has existed for the last half century.

Much of my experience in international higher education has been in places undergoing radical transformation of their systems in short periods of time, including several nations in southern Africa as well as various post-communist nations of the former Soviet Union. Late last year I was in Shanghai, and I saw first-hand the tremendous advances that have been made, both in social and educational terms, in just a short period of time within the world’s most-populous country. Just a decade ago, China educated fewer than half as many people as the United States enrolled each year. Today, China has the largest higher-education system in the world, having surpassed total American enrollment sometime during the past two years. Given the continuing investment in higher education in places such as China and India as well as the sheer size of the populations these countries are educating, the United States will begin feeling tremendous economic pressure, and higher education won’t be immune.

So what kinds of investments will we be making at Lumina Foundation? While it’s still too early in my tenure to make a definitive statement, there are some obvious directions that we are likely to take in the near-term.

First, we will build on the success of the work that is already under way. The three biggest pieces of our work are part of what we informally call Lumina’s Big Bets. These are efforts in which we apply significant resources to a specific issue or area in search of large-scale effects.

The best-known among these is the pioneering work we have done with community colleges through the Achieving the Dream initiative. Achieving the Dream is a multiyear national effort to help more community college students succeed. The initiative concerns itself with student groups that traditionally have faced major barriers to success, including students of color, first generation students and low-income students. Achieving the Dream works on multiple fronts, including improvement of community college student success and through research, public engagement and public policy that can bolster student success. It emphasizes the use of data to drive change. A total of 83 community colleges in 15 states supported by a coalition of 19 funding partners is working on this national initiative, with more likely to follow.

The second initiative, Making Opportunity Affordable, is our biggest challenge. Making Opportunity Affordable is designed to promote and support a productivity agenda for American higher education, particularly at public institutions. The initiative’s agenda embraces several strategies. The most important is direct work with states to overhaul finance systems to stimulate productivity, increase the efficiency and effectiveness of academic programs and administrative operations, and realign system capacity.

The third Big Bet is the KnowHow2GO campaign. Young people in all socio-economic groups have college aspirations. In fact, nine out of 10 low-income teens plan to pursue a college education. Despite these aspirations, low-income students and those who are first in their families to go to college are still severely underrepresented on college campuses. Studies show these students often lack the preparation, guidance and resources they need to get ready for postsecondary education.

In order to turn these students’ college dreams into action-oriented goals, the American Council on Education, Lumina Foundation for Education and the Ad Council launched the KnowHow2GO campaign in January 2007. This multiyear, multimedia effort includes television, radio and outdoor public service advertisements that encourage 8th through 10th graders to prepare for college using defined action steps.

Beyond those investments and the other grantmaking, we also plan to invest in two major strategies early. These are also Big Bets but are focused more on cross-cutting strategy as compared to the issue-specific nature of the three major initiatives. One is to emphasize the role that policy can play as a lever for systemic change. Philanthropy can play many important roles that government cannot. These include supporting innovation, disseminating research and program lessons and building capacity in intermediary organizations that help support our mission. The increased emphasis on policy should be no surprise, given my background. We will be looking for ways in which we can support effective policy that promotes access to—and success in—higher education on many different levels.

At one end of this policy spectrum are activities like building the capacity of state government, along with regional and national organizations, to support effective policymaking. We can also support issue framing and analysis through our research and demonstration projects. These are the kinds of tactics that philanthropy has historically supported. But my hope is that we can more directly invest in public will-building—media outreach, coalition building—as well as in agenda setting by participating in policy development. Ultimately, we hope to provide resources that promote development of model legislation, regulatory frameworks and other practical tools that go beyond the conceptual work that defines much of what philanthropy has done previously.

The second near-term strategy will be to invest in convening as a tool for supporting and promoting change. Since arriving at Lumina, I have talked about the need to convene the nation’s best, most-innovative thinkers, particularly by bringing new voices and perspectives to the debates about college access and success. Foundations have the power to convene policymakers, business and higher education leaders, and experts on higher education in a way that can accelerate progress on key issues.

These convenings could be forums sponsored directly by the Foundation or through the work of our grantees and partners. We want to foster discussion, debate and strategies that lead to solutions. An important aspect of these convenings will involve looking outside of higher education to the business and policy worlds as a means of augmenting the knowledge and experience of the frequently consulted higher-ed experts.

Lumina Foundation for Education, like its peers in the world of philanthropy, cannot solve the challenges of college access and success on its own or in collaboration with its partners in philanthropy. Ultimately, Lumina’s work must be informed and driven by the knowledge and skills of its grantees and others who support the mission of increasing access and success beyond high school. The ideas and strategies I’ve outlined this evening are not the only ways to develop and expand our understanding. But these avenues might lead to new ideas, motivation or inspiration for our work in higher education at a time when so much is at stake.

Thank you very much for the opportunity to be with you this evening and for allowing me to share these thoughts.

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