08832323.2011.625997
Journal of Education for Business
ISSN: 0883-2323 (Print) 1940-3356 (Online) Journal homepage: http://www.tandfonline.com/loi/vjeb20
Where Did They Go? Market Share Trends of
Business Student Enrollment at Public, Not-forProfit, and For-Profit Institutions From 1996 to
2008
Bonnie Kathleen Fox Garrity
To cite this article: Bonnie Kathleen Fox Garrity (2012) Where Did They Go? Market
Share Trends of Business Student Enrollment at Public, Not-for-Profit, and For-Profit
Institutions From 1996 to 2008, Journal of Education for Business, 87:6, 309-315, DOI:
10.1080/08832323.2011.625997
To link to this article: http://dx.doi.org/10.1080/08832323.2011.625997
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Date: 11 January 2016, At: 22:05
JOURNAL OF EDUCATION FOR BUSINESS, 87: 309–315, 2012
C Taylor & Francis Group, LLC
Copyright
ISSN: 0883-2323 print / 1940-3356 online
DOI: 10.1080/08832323.2011.625997
Where Did They Go? Market Share Trends of
Business Student Enrollment at Public,
Not-for-Profit, and For-Profit Institutions From 1996
to 2008
Downloaded by [Universitas Maritim Raja Ali Haji] at 22:05 11 January 2016
Bonnie Kathleen Fox Garrity
D’Youville College, Buffalo, New York, USA
The author presents the trends in market share of business student enrollment at public, not-forprofit, and for-profit 4-year-and-above institutions from 1996 to 2008. Although each sector
of the institutions has experienced growth in overall enrollments, the relative market share of
public and not-for-profit institutions has dropped, whereas the market share held by for-profit
institutions has increased to 20% of business students at 4-year-and-above institutions by 2008.
The key player institutions in the enrollment of business students in 2008 are presented. The
author gives an explanation for the shift in market share and discusses the implications and
strategies for response to the changes.
Keywords: business students, for-profit, not-for-profit, public
According to the National Center for Education Statistics
(2010), there were 4 million postsecondary business students
in the United States in 2008, making business the single
largest major field of study. Sixty-five percent (2.6 million) of
these students were enrolled in 4-year-and-above institutions.
Postsecondary education in the United States is offered
by a combination of public, not-for-profit, and for-profit institutions. Statistics are readily available related to the total
numbers of business students and the relative market share of
all students by control of the institution. However, there are
no publications or statistics available which provide market
share data on the enrollment of business students by control
of the institution.
I begin with a review of the literature on enrollment
data and business students. The methodology section includes an overview of the Integrated Postsecondary Education Database System (IPEDS) and the calculations used
in the study. Descriptive results of the enrollment and market
share of business students are provided, as is a discussion of
the results as related to the reasons, implications, and possible
responses to the observed trends.
Correspondence should be addressed to Bonnie Kathleen Fox Garrity,
D’Youville College, Department of Business, 320 Porter Avenue, Buffalo,
NY 14201, USA. E-mail: garrityb@dyc.edu
REVIEW OF LITERATURE
Postsecondary Enrollment
In the fall of 2008 there were 19.6 million students enrolled
in Title IV participating postsecondary institutions (Knapp,
Kelly-Reid, & Ginder, 2010). These are institutions eligible
to grant Title IV student financial aid such as Pell Grants
and federally subsidized student loans to their students. Of
the 19.6 million students, 62% were enrolled in 4-year-andabove institutions (Knapp, Kelly-Reid, & Ginder, 2010).
Undergraduate enrollment at 4-year-and-above institutions has grown by 35% (from 6,960,470 to 9,394,633 students) and enrollment at the graduate level has increased by
32% (from 2,072,275 to 2,736,803 students) between 1998
and 2008 (author’s calcuations based on data from Snyder &
Dillow, 2011; Snyder & Hoffman, 2001).
Postsecondary education is provided by public, notfor-profit, and for-profit providers competing for student
enrollments in a mixed-form market (see Marwell &
McInerney, 2005). Market share is not evenly distributed.
Public providers hold the largest market share with 60%
(5,951,146 students) of the students at 4-year-and-above
institutions whereas not-for-profits hold 30% (2,501,181
students) and for-profits hold 10% (942,306 students; Knapp
et al., 2010). In addition, each sector of institution has
310
B. K. FOX GARRITY
experienced different growth rates resulting in changing
market shares. Between 1998 and 2008, undergraduate
enrollment at 4-year-and-above institutions grew 26% (from
4,714,943 to 5,951,146 students) at public institutions, 20%
(from 2,088,197 to 2,501,181 students) at not-for-profit
institutions, and 499% (from 157,330 to 942,306 students)
at for-profit institutions (author’s calculations based on data
from Snyder & Dillow, 2011; Snyder & Hoffman, 2001).
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Business Student Enrollment
Business student enrollments represent the single largest major field of study in the United States. During the 2007–2008
year, 16% of students were enrolled in business, management, and marketing major fields of study (National Center
for Education Statistics, 2010). When including economics,
the percentage increases to 17% of students. At 4-year-andabove institutions, enrollments of business students account
for 20% of all student enrollments (National Center for Education Statistics).
Expense Structures
Expense structures differ between institutions and among
sectors of institutions. Most public and not-for-profit
institutions provide a subsidy to students whose tuition
dollars do not cover the entire expense of the education
provided (Winston, 1999b). These subsidies are provided
by government grants to the institutions or through private
donations. Public and not-for-profit institutions vary widely
in the amount of subsidy provided (Winston, 1999b). These
subsidies of students may serve as barriers to entry of forprofits (Winston, 1999a). Due to these subsidies, increases
in enrollment at not-for-profit and public institutions may
lead to increased expenses without an equivalent increase
in revenue. However, for-profit institutions rarely provide a
subsidy to students (Winston, 1999a) and compete through
minimization of expenses (Turner, 2006).
Not only are many students subsidized by not-for-profit
and public institutions, students enrolled in some majors are
subsidized by students enrolled in other majors. Although
peer-reviewed literature on the topic is rare, the direct and indirect instructional costs associated with courses and departments differ (McChlery & Rolfe, 2004; Middaugh, 1996).
Business courses carry relatively low instructional costs compared with some disciplines on campus (Ahumada, 1992).
Even though expenses differ, students are often charged the
same tuition regardless of major field of study or elective
courses selected. Thus the difference between tuition charged
and expenses incurred differs depending on the major field
of study and course schedules. Students in lower expense
programs, therefore, subsidize the education of the students
in higher expense programs.
Winston (1999a) and Kelly (2001) suggested that functional cherry-picking may take place by for-profits where
services and programs with the greatest difference between
expenses and revenue will be targeted by for-profits. Therefore, as lower expense programs with 3.5 million students,
business programs may be an attractive entry point for forprofit providers.
Not only would the increase in for-profit provision of business education impact enrollments in the business programs
on public and not-for-profit campuses, it may negatively impact the ability of these same institutions to continue offering
higher expense programs if they fail to maintain enrollments
in lower expense programs such as business to sufficiently
subsidize the students in the higher expense programs.
For-Profit Business Education History
For-profit provision of business education is not a new concept in the United States. Approximately 250 proprietary or
for-profit business schools were in existence by 1890 with
81,000 students (Kinser, 2006a). One of the earliest for-profit
institutions still in existence is Bryant and Stratton, which
was established in 1852 and is credited with pioneering curriculum and textbook standardization to minimize expenses,
which are techniques still utilized by many for-profit institutions (Kinser). However, the movement toward for-profit
provision of 4-year-and-above education has been a relatively
recent phenomenon.
RESEARCH QUESTIONS
The published data include extensive tables detailing institutional enrollments. Unfortunately, there are no published
sources on enrollments by major within the different institutional sectors. This lack of analysis leaves a gap in the
data available to inform enrollment management and business department strategic planning initiatives. Therefore, in
this article I will answer the following research questions:
Research Question 1: What were the trends in enrollment of
business students at public, not-for-profit, and for-profit
4-year-and-above institutions between 1996 and 2008?
Research Question 2: What were the trends in relative market
share of business students at public, not-for-profit, and
for-profit 4-year-and-above institutions between 1996
and 2008?
Research Question 3: Which institutions were the key players
in the enrollment of business majors in 2008?
METHOD
The National Center for Education Statistics (NCES) collects
data from all postsecondary institutions that participate in the
Title IV student aid programs such as Pell Grants and federally subsidized student loans. Therefore, this dataset contains
data on nearly all institutions in the United States. All participating institutions are required to complete nine surveys
each year to be in compliance with the Higher Education
MARKET SHARE TRENDS
311
TABLE 1
Total Business Students Enrolled in 4-Year-and-Above Institutions
Type
Public
Not-for-profit
For-profit
Total
1996
1998
2000
2002
2004
2006
2008
721,457
507,374
44,952
1,273,783
729,999
488,562
29,629
1,248,190
752,456
455,116
64,889
1,272,461
891,254
602,995
159,572
1,653,821
909,264
612,640
277,400
1,799,304
951,339
644,999
369,861
1,966,198
1,012,747
675,400
433,455
2,121,602
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Note. Data from my calculations from Integrated Postsecondary Education Database System data.
Act (2008) as amended. In addition, during even numbered
years, 4-year institutions are required by the Office of Civil
Rights Compliance to report enrollment data in nine specific
fields of study including business management and administrative sciences. These data are then made available through
the IPEDS for research use. This provides data on the entire
population of Title IV participating institutions for analysis.
For this study, enrollment and institutional characteristics
files for each of the seven years included in the study were
downloaded from the IPEDS system. Syntax files were run.
Files were then restructured, variables were calculated, and
files were matched using SPSS to pair enrollment by major
(CIP Code) with sector of the institution for each year. The
dataset for each year contained approximately 2,000 institutions.
The values for the 2006 enrollments of business students
were imputed for 97 institutions (54 of which were campuses
of the University of Phoenix) due to a lack of reported or released data by major that year. The imputation was completed
by averaging the 2004 business student enrollment with the
2008 business student enrollment for institutions that had
data reported for both 2004 and 2008 but none for 2006.
RESULTS
Research Question 1
What were the trends in enrollment of business students at
public, not-for-profit, and for-profit 4-year-and-above institutions between 1996 and 2008? Enrollments of business
FIGURE 1 Total enrollment of business students at 4-year-and-above
institutions 1996–2008. Data from my calculations from Integrated Postsecondary Education Database System data.
students in all sectors of institutions have increased from
1996 to 2008 (see Table 1 and Figure 1). There was a slight
decline in enrollments at not-for-profit institutions in 1998
and 2000 and at for-profit institutions in 1998, but the general trend has been growth with overall enrollments growing
from 1.3 million in 1996 to 2.1 million in 2008.
However, the increases have not been proportionate
among the sectors. The for-profit sector has shown the greatest percentage increase in business student enrollments with
greater than an 850% increase in business students from 1996
(44,952) to 2008 (433,455; see Table 1), whereas public and
not-for-profit institutions reported increases of 40% (from
721,457 to 1,012,747) and 33% (from 507,374 to 675,400),
respectively.
Figure 1 shows the general trends within each sector with
the greatest increases in each sector from 2000 to 2008. By
2008, more than 1 million business students were enrolled in
4-year-and-above public institutions, which was nearly half
of all business students. At this same time not-for-profits enrolled 675,000 business students whereas for-profits enrolled
the smallest number of business students, 433,000. Evident in
this figure is the narrowing of the gap between total business
student enrollments at not-for-profit and for-profit institutions.
Research Question 2
What were the trends in relative market share of business
students at public, not-for-profit, and for-profit, 4-year-andabove institutions between 1996 and 2008? Figure 2 shows
the relative market share of each sector of institution in
each year of the study. Despite the growth in enrollments
in each sector, there was a striking increase in for-profit
market share with a resulting decrease in market share in
the public and not-for-profit sectors. Public institutions enrolled 59% (from 752,456 of 1,272,461) of business students in 2000. Within just 8 years, the public market share
declined to 48% (from 1,012,747 of 2,121,602). Not-forprofit institutions had their highest market share in 1996 at
40% (from 507,374 of 1,273,783). Although hovering around
36% for several years of the study, they have declined to
32% (from 675,400 of 2,121,602) in 2008. By 2008 forprofit institutions enrolled 20% (from 433,455 of 2,121,602)
of the business students at 4-year-and-above institutions,
312
B. K. FOX GARRITY
TABLE 2
Key Players in the 2008 Market for Business Students
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FIGURE 2 Market share of business student enrollment at 4-year-andabove Institutions 1996–2008. Data from my calculations from Integrated
Postsecondary Education Database System data. Percentages may not sum
to 100% due to rounding.
up from a low of 2% (from 44,952 of 1,273,783) in 1998
(see Figure 2).
Institution
Sector
University of Phoenix–Online Campus
Strayer University
American Intercontinental University
Online
University of Maryland–University
College
DeVry University-Illinois
University of Central Florida
Kaplan University
Colorado Technical University Online
Webster University
For-profit
For-profit
For-profit
Ashford University
Arizona State University
City University of New York Bernard M.
Baruch College
2008 Business
student
enrollment
137,553
30,000
19,633
Public
16,304
For-profit
Public
For-profit
For-profit
Not-forprofit
For-profit
Public
Public
15,225
11,842
11,806
11,549
10,898
10,880
10,755
10,692
Research Question 3
Which institutions were the key players in the enrollment
of business majors in 2008? A key player in the market
for business student enrollment is defined as an institution
with greater than 10,000 business students. Table 2 lists the
12 key player institutions in 2008. The top three institutions
were all for-profit, including the University of Phoenix online
campus (137,553), Strayer University (30,000), and American Intercontinental University (19,633). The University of
Phoenix Online Campus enrolled 6.5% of all business students at 4-year-and-above institutions in 2008. This total does
not include the land-based enrollments at the 73 other University of Phoenix campuses located throughout the United
States.
Of the 12 key player institutions, one was not-for-profit,
four were public, and seven were for-profit. These 12 key
players held a combined 14% market share of the business
student enrollments at 4-year-and-above institutions.
DISCUSSION
The relative loss of market share within the public and notfor-profit sectors may not have been evident because each
sector of institution has generally experienced increases in
business student enrollments during the years of the study.
However, those increases have not been great enough to keep
pace with the growth of the for-profit sector.
The compounded annual growth rate of the market of business students has been 4.75% (from 1,273,783 to 2,121,602)
from 1996 to 2008. For-profit institutions as a sector experienced a 22.88% (from 44,952 to 433,455) compounded
annual growth rate whereas public and not-for-profit institutions had a 3.13% (from 721,457 to 1,012,747) and 2.63%
(from 507,374 to 675,400) compounded annual growth rates,
Note. Data from my calculations from Integrated Postsecondary Education Database System data.
respectively, from 1996 to 2008. With annual growth rates
lower than the market growth rate, these sectors of institutions were not taking advantage of the growth of the market
and were losing market share to the for-profit sector.
The increase in market share of for-profit institutions is
clearly related to the growth of one institution (University
of Phoenix), which may be deemed to be atypical of the
for-profit sector (Kinser, 2006b), leading some to ignore the
overall growth rate of for-profit market share; however, the
list of key players contains six other for-profit institutions
demonstrating that dismissing the growth of the sector based
upon one key player would be fallacious.
Three key player institutions are online campuses of forprofit institutions. This could lead to an assumption that most
online business students are enrolled at for-profit institutions
and that the growth of for-profit institutions is driven by a
disproportionate enrollment of online students. The growth
of online enrollments has contributed to the expansion of
the market of business students, with 60% of fully online
business programs reporting increased student enrollments
between fall 2009 and fall 2010 (Allen & Seaman, 2010).
Reports of online course enrollment growth vary, ranging
from an annual rate of 21% (Allen & Seaman, 2010) to 40%
(Lee & Nguyen, 2007). However, for-profit institutions are
not the leader in overall online (nonhybrid) course enrollments. At 4-year-and-above institutions publics have more
than 2.4 million (45%), for-profits have more than 1.6 million
(30%), and not-for-profits have more than 1.3 million (25%)
online course enrollments (Parsad, Lewis, & Tice, 2008).
So, although online enrollments have certainly contributed to the growth of the business student market and
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MARKET SHARE TRENDS
for-profit provision of business education at online campuses,
growth of online enrollments is not likely the sole reason for
the increase in for-profit market share. Further study of the
changes in online enrollments in business programs by sector
over time is suggested.
The size of the key players in the market suggests the
pursuit of economies of scale in the provision of business
education to minimize expenses. However, at public and notfor-profit institutions, the subsidies provided to students may
discourage many institutions from pursuing the growth rates
needed to see results from economies of scale. On the other
hand, in a for-profit model where there is very little subsidy
of students, increased enrollment can lead to an increase in
revenue and profit making pursuit of economies of scale an
attractive strategy.
Reasons for the Growth of For-Profit Business
Education
Several factors have contributed to the growth of for-profit
provision of postsecondary business education. These factors
are divided between those related specifically to the growth
of for-profit business education and factors related to the
general growth of for-profit enrollments.
Business student enrollment at for-profit institutions have
been influenced by the comparatively low expenses of offering business programs, legal restrictions on the programs
offered, and the relatively high incomes of business program
alumni.
Because business programs generally have lower expenses
than some other programs, maximizing business enrollments
at for-profit institutions is to be expected. The lower expenses
coupled with large enrollments make business programs an
especially attractive target of for-profit institutions.
The pursuit of increased enrollments of business students
at for-profits is related to a combination of legislation and
the higher reported incomes of business graduates. For-profit
institutions are limited by the Higher Education Act of 1965
as amended to offering programs that prepare students for
gainful employment in a recognized occupation. In addition,
a new gainful employment rule announced in June 2011
(Field, 2011) is to compare the income of people who have
been enrolled in each program of a for-profit institution to
the student loan debt held by those former students. If the
results show a high student loan debt-to-income ratio, that
program may lose eligibility to participate in Title IV student aid programs. Because business majors have relatively
high incomes after graduation (Carnevale, Strohl, & Melton,
2011), enrollments of additional business students is not
likely to cause an institution to violate this new gainful employment rule. It can, therefore, be predicted that for-profit
institutions will continue to pursue enrollments of business
students.
Factors related to the general growth of for-profit postsecondary enrollments include aggressive recruitment strategies
313
employed by some for-profit institutions, federal student aid
policies, access to capital, and the customer service focus of
for-profit institutions.
Concerns about aggressive recruitment strategies employed by some for-profit institutions triggered a federal
investigation in 2009. Widespread media coverage of the
investigation and the subsequent modifications to the government’s report documented these practices.
In addition to these practices, financial factors have contributed to growth. Most federal student aid such as Pell
Grants and military tuition benefits are portable and follow
the student to their institution. Periods of growth of for-profit
postsecondary education have been linked to increased access to federal student aid (Bailey, Badway, & Gumport,
2001; Kinser, 2006a, 2006b; Turner, 2006). Increases in Pell
Grants, the temporary allowance of two Pell Grants per year,
and enhanced tuition benefits for military personnel have all
increased the availability of federal student aid during the
years of this study.
Capital is required to fuel expansion plans and increase enrollments. Access to capital is related to the revenue sources
of each sector. Reductions in state and private donations and a
tightening of credit policies have limited the ability of public
and not-for-profit institutions to engage in expansion plans.
For-profit institutions are mainly tuition-driven and have access to capital markets as funding sources for expansion
strategies. The relative advantage of public institutions decreases as direct government subsidies to institutions decline
(Turner, 2006).
In addition to financial reasons, for-profit institutions are
more likely to adopt a customer service approach to attract
students and increase enrollments (Morey, 2004). This may
include course schedules designed to fit around work schedules, assistance with financial aid filings, locations convenient to work and major highways, urban campuses, and a
reduction in general education courses required for a degree
(Kinser, 2006a; Morey).
This approach has been observed in other industries with
mixed-form economies including hospitals and prisons (Hart,
Shleifer, & Vishny, 1997; Picone, Chou, & Sloan, 2002). To
maximize profits, for-profit providers may increase perceived
quality by investing in amenities that are readily observable
such as modern facilities, food services, and equipment while
cutting less observable inputs affecting the quality of the
services provided such as employee compensation levels,
minimum hiring standards, and training. Hart et al. named the
difficult-to-observe quality markers noncontractible quality
because it is difficult for the government to provide a contract
with enough detail related to every facet of the operations
of an institution. Those factors that are not detailed in the
contract are noncontractible and left to the discretion of the
provider. Other examples in education include scheduling,
curriculum requirements, and locations.
As for-profit providers reduce noncontractible quality
and increase markers of perceived quality meant to attract
314
B. K. FOX GARRITY
students, not-for-profit and public providers are pressured
to compete to attract and retain students. This pressure to
compete leads to one of the major implications of these
findings.
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Implications
There are several major implications of the findings of this
study. One of the more serious is the impact that competing
for students with for-profit institutions may have on notfor-profit and public institutions. The practices of customer
service and reductions in noncontractible quality may be
mimicked as institutions compete for business student enrollments. Competition with for-profit institutions influences
decisions at not-for-profit and public institutions (Allen &
Seaman, 2010; Morey, 2004). A 2002 report to the Board
of the Association to Advance Collegiate Schools of Business (AACSB) noted pressure on AACSB schools to offer
programs in different formats to satisfy customer wants and
needs. Emergence of new competitors was cited as the number two factor driving change at AACSB schools of business
(Olian, 2002).
Additional implications include a potential change in the
perceived value of degrees from different sectors; a reduction
of business faculty involvement in shared governance, public service and research activities; and difficulty supporting
higher expense programs at not-for-profit and public institutions.
The perceived value of a degree from a particular institution may be related to the institution’s control. Most public
and not-for-profit institutions hold regional accreditation.
Some for-profit institutions are regionally accredited but
many hold national accreditation. However, accreditation
is not the only indicator of perceived value. Hiring decisions by employers, industry-institution partnerships,
limitations in employer tuition assistance benefit programs,
government funding appropriation decisions, and student
enrollment decisions all provide partial answers to the
question of the perceived value of a degree from a particular
institution.
A pertinent change has been observed in the public perception of for-profit and not-for-profit hospitals. Reports of
fraudulent practices at for-profit hospitals adversely affected
public opinion in the mid-1980s; however, respondents reported that quality was not related to ownership status. However, by 2002 a majority of people surveyed believed that
for-profit hospitals provided higher quality care whereas notfor-profit hospitals had lower costs (Schlesinger, Mitchell, &
Gray, 2004). Several instances of fraudulent or deceptive recruitment practices at for-profit educational institutions have
been reported recently. The trends in the hospital industry
suggest that those incidents soon may be forgotten by the
public and the perception of quality may tilt in favor of forprofit institutions. This could alter the perceived value of
degrees from various sectors of institutions.
The implications for business faculty and their role in
shared governance, research, and public service are of note.
Shared governance is practiced in some form on most not-forprofit and public campuses. However, for-profit institutions
rarely engage in shared governance activities and often
employ more adjunct faculty than other types of institutions
(Morey, 2004). Similarly for-profit institutions generally do
not provide for public service nor do they expect or support
their faculty in research activities (Morey). As business
student enrollments are disproportionately high at for-profit
institutions, full-time faculty jobs, business faculty engagement in shared governance, and overall public service and
research in this field may also be disproportionately reduced
compared with other fields. In addition, the use of centrally
designed curriculum is common at for-profits leaving
teaching faculty with little control over the curriculum and
reducing the need for subject matter expertise of those who
teach.
Financially, public and not-for-profit campuses with business programs may have difficulty in funding higher expense
programs when business students are cherry-picked by the
for-profit institutions. This will lead to a need for increased
revenue from other sources.
Alternatives and Strategies for Change
Business schools have options of how to respond to the trends
in business student enrollments. Several defense strategies
are suggested. Institutions may also choose to increase their
institution’s business student enrollments. Alternatively, institutions may choose to ignore the trends, although this
would likely be an ill-fated long-term strategy.
To defend the role of their own institution, business school
faculty and administrators should establish and communicate
the value of a degree from their institution to maintain credibility with employers, donors, potential students, state and
federal policymakers, and alumni. Specialized accreditation
can be used to establish value. This value should be explained
and reinforced to all constituencies.
Coordinated lobbying efforts should be used to ensure
that state and federal policymakers are familiar with the differences between sectors of institutions. This strategy has
been used heavily by for-profit institutions in response to
congressional actions including legislation changes and investigations.
Policies and standards that limit expansion should be examined to determine if they serve as legitimate protections
for students and learning. If they do, that value must be communicated to stakeholders. If they do not, efforts should be
made to change them.
Market expansion should be monitored and opportunities to expand explored. Business faculty and administrators should lobby for increased funding to expand business
programs if appropriate. Knowledge of the relative expense
levels of programs on campus may assist in these efforts.
MARKET SHARE TRENDS
The value of the research and public service provided by
the full-time faculty and funded in part by the university
must be clearly articulated. This is essential to continuing
funding and distinguishing between institutions in different
sectors.
The most important strategy is to monitor changes in market share. Do not ignore any one sector as all three now hold
a sizeable number of business student enrollments. Careful
monitoring of trends in enrollment will allow each institution
and sector to plan a strategic response.
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CONCLUSION
The general increases in business student enrollments at each
sector of institution might have masked the dramatic changes
in market share from 1996 to 2008. The changing landscape
of business education in the United States is highlighted by
the dramatic increase in market share held by for-profit institutions and the identification of the key players in the market.
It is imperative that all institutions engaged in educating business students understand and respond strategically to these
changes.
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ISSN: 0883-2323 (Print) 1940-3356 (Online) Journal homepage: http://www.tandfonline.com/loi/vjeb20
Where Did They Go? Market Share Trends of
Business Student Enrollment at Public, Not-forProfit, and For-Profit Institutions From 1996 to
2008
Bonnie Kathleen Fox Garrity
To cite this article: Bonnie Kathleen Fox Garrity (2012) Where Did They Go? Market
Share Trends of Business Student Enrollment at Public, Not-for-Profit, and For-Profit
Institutions From 1996 to 2008, Journal of Education for Business, 87:6, 309-315, DOI:
10.1080/08832323.2011.625997
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Published online: 30 Aug 2012.
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Date: 11 January 2016, At: 22:05
JOURNAL OF EDUCATION FOR BUSINESS, 87: 309–315, 2012
C Taylor & Francis Group, LLC
Copyright
ISSN: 0883-2323 print / 1940-3356 online
DOI: 10.1080/08832323.2011.625997
Where Did They Go? Market Share Trends of
Business Student Enrollment at Public,
Not-for-Profit, and For-Profit Institutions From 1996
to 2008
Downloaded by [Universitas Maritim Raja Ali Haji] at 22:05 11 January 2016
Bonnie Kathleen Fox Garrity
D’Youville College, Buffalo, New York, USA
The author presents the trends in market share of business student enrollment at public, not-forprofit, and for-profit 4-year-and-above institutions from 1996 to 2008. Although each sector
of the institutions has experienced growth in overall enrollments, the relative market share of
public and not-for-profit institutions has dropped, whereas the market share held by for-profit
institutions has increased to 20% of business students at 4-year-and-above institutions by 2008.
The key player institutions in the enrollment of business students in 2008 are presented. The
author gives an explanation for the shift in market share and discusses the implications and
strategies for response to the changes.
Keywords: business students, for-profit, not-for-profit, public
According to the National Center for Education Statistics
(2010), there were 4 million postsecondary business students
in the United States in 2008, making business the single
largest major field of study. Sixty-five percent (2.6 million) of
these students were enrolled in 4-year-and-above institutions.
Postsecondary education in the United States is offered
by a combination of public, not-for-profit, and for-profit institutions. Statistics are readily available related to the total
numbers of business students and the relative market share of
all students by control of the institution. However, there are
no publications or statistics available which provide market
share data on the enrollment of business students by control
of the institution.
I begin with a review of the literature on enrollment
data and business students. The methodology section includes an overview of the Integrated Postsecondary Education Database System (IPEDS) and the calculations used
in the study. Descriptive results of the enrollment and market
share of business students are provided, as is a discussion of
the results as related to the reasons, implications, and possible
responses to the observed trends.
Correspondence should be addressed to Bonnie Kathleen Fox Garrity,
D’Youville College, Department of Business, 320 Porter Avenue, Buffalo,
NY 14201, USA. E-mail: garrityb@dyc.edu
REVIEW OF LITERATURE
Postsecondary Enrollment
In the fall of 2008 there were 19.6 million students enrolled
in Title IV participating postsecondary institutions (Knapp,
Kelly-Reid, & Ginder, 2010). These are institutions eligible
to grant Title IV student financial aid such as Pell Grants
and federally subsidized student loans to their students. Of
the 19.6 million students, 62% were enrolled in 4-year-andabove institutions (Knapp, Kelly-Reid, & Ginder, 2010).
Undergraduate enrollment at 4-year-and-above institutions has grown by 35% (from 6,960,470 to 9,394,633 students) and enrollment at the graduate level has increased by
32% (from 2,072,275 to 2,736,803 students) between 1998
and 2008 (author’s calcuations based on data from Snyder &
Dillow, 2011; Snyder & Hoffman, 2001).
Postsecondary education is provided by public, notfor-profit, and for-profit providers competing for student
enrollments in a mixed-form market (see Marwell &
McInerney, 2005). Market share is not evenly distributed.
Public providers hold the largest market share with 60%
(5,951,146 students) of the students at 4-year-and-above
institutions whereas not-for-profits hold 30% (2,501,181
students) and for-profits hold 10% (942,306 students; Knapp
et al., 2010). In addition, each sector of institution has
310
B. K. FOX GARRITY
experienced different growth rates resulting in changing
market shares. Between 1998 and 2008, undergraduate
enrollment at 4-year-and-above institutions grew 26% (from
4,714,943 to 5,951,146 students) at public institutions, 20%
(from 2,088,197 to 2,501,181 students) at not-for-profit
institutions, and 499% (from 157,330 to 942,306 students)
at for-profit institutions (author’s calculations based on data
from Snyder & Dillow, 2011; Snyder & Hoffman, 2001).
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Business Student Enrollment
Business student enrollments represent the single largest major field of study in the United States. During the 2007–2008
year, 16% of students were enrolled in business, management, and marketing major fields of study (National Center
for Education Statistics, 2010). When including economics,
the percentage increases to 17% of students. At 4-year-andabove institutions, enrollments of business students account
for 20% of all student enrollments (National Center for Education Statistics).
Expense Structures
Expense structures differ between institutions and among
sectors of institutions. Most public and not-for-profit
institutions provide a subsidy to students whose tuition
dollars do not cover the entire expense of the education
provided (Winston, 1999b). These subsidies are provided
by government grants to the institutions or through private
donations. Public and not-for-profit institutions vary widely
in the amount of subsidy provided (Winston, 1999b). These
subsidies of students may serve as barriers to entry of forprofits (Winston, 1999a). Due to these subsidies, increases
in enrollment at not-for-profit and public institutions may
lead to increased expenses without an equivalent increase
in revenue. However, for-profit institutions rarely provide a
subsidy to students (Winston, 1999a) and compete through
minimization of expenses (Turner, 2006).
Not only are many students subsidized by not-for-profit
and public institutions, students enrolled in some majors are
subsidized by students enrolled in other majors. Although
peer-reviewed literature on the topic is rare, the direct and indirect instructional costs associated with courses and departments differ (McChlery & Rolfe, 2004; Middaugh, 1996).
Business courses carry relatively low instructional costs compared with some disciplines on campus (Ahumada, 1992).
Even though expenses differ, students are often charged the
same tuition regardless of major field of study or elective
courses selected. Thus the difference between tuition charged
and expenses incurred differs depending on the major field
of study and course schedules. Students in lower expense
programs, therefore, subsidize the education of the students
in higher expense programs.
Winston (1999a) and Kelly (2001) suggested that functional cherry-picking may take place by for-profits where
services and programs with the greatest difference between
expenses and revenue will be targeted by for-profits. Therefore, as lower expense programs with 3.5 million students,
business programs may be an attractive entry point for forprofit providers.
Not only would the increase in for-profit provision of business education impact enrollments in the business programs
on public and not-for-profit campuses, it may negatively impact the ability of these same institutions to continue offering
higher expense programs if they fail to maintain enrollments
in lower expense programs such as business to sufficiently
subsidize the students in the higher expense programs.
For-Profit Business Education History
For-profit provision of business education is not a new concept in the United States. Approximately 250 proprietary or
for-profit business schools were in existence by 1890 with
81,000 students (Kinser, 2006a). One of the earliest for-profit
institutions still in existence is Bryant and Stratton, which
was established in 1852 and is credited with pioneering curriculum and textbook standardization to minimize expenses,
which are techniques still utilized by many for-profit institutions (Kinser). However, the movement toward for-profit
provision of 4-year-and-above education has been a relatively
recent phenomenon.
RESEARCH QUESTIONS
The published data include extensive tables detailing institutional enrollments. Unfortunately, there are no published
sources on enrollments by major within the different institutional sectors. This lack of analysis leaves a gap in the
data available to inform enrollment management and business department strategic planning initiatives. Therefore, in
this article I will answer the following research questions:
Research Question 1: What were the trends in enrollment of
business students at public, not-for-profit, and for-profit
4-year-and-above institutions between 1996 and 2008?
Research Question 2: What were the trends in relative market
share of business students at public, not-for-profit, and
for-profit 4-year-and-above institutions between 1996
and 2008?
Research Question 3: Which institutions were the key players
in the enrollment of business majors in 2008?
METHOD
The National Center for Education Statistics (NCES) collects
data from all postsecondary institutions that participate in the
Title IV student aid programs such as Pell Grants and federally subsidized student loans. Therefore, this dataset contains
data on nearly all institutions in the United States. All participating institutions are required to complete nine surveys
each year to be in compliance with the Higher Education
MARKET SHARE TRENDS
311
TABLE 1
Total Business Students Enrolled in 4-Year-and-Above Institutions
Type
Public
Not-for-profit
For-profit
Total
1996
1998
2000
2002
2004
2006
2008
721,457
507,374
44,952
1,273,783
729,999
488,562
29,629
1,248,190
752,456
455,116
64,889
1,272,461
891,254
602,995
159,572
1,653,821
909,264
612,640
277,400
1,799,304
951,339
644,999
369,861
1,966,198
1,012,747
675,400
433,455
2,121,602
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Note. Data from my calculations from Integrated Postsecondary Education Database System data.
Act (2008) as amended. In addition, during even numbered
years, 4-year institutions are required by the Office of Civil
Rights Compliance to report enrollment data in nine specific
fields of study including business management and administrative sciences. These data are then made available through
the IPEDS for research use. This provides data on the entire
population of Title IV participating institutions for analysis.
For this study, enrollment and institutional characteristics
files for each of the seven years included in the study were
downloaded from the IPEDS system. Syntax files were run.
Files were then restructured, variables were calculated, and
files were matched using SPSS to pair enrollment by major
(CIP Code) with sector of the institution for each year. The
dataset for each year contained approximately 2,000 institutions.
The values for the 2006 enrollments of business students
were imputed for 97 institutions (54 of which were campuses
of the University of Phoenix) due to a lack of reported or released data by major that year. The imputation was completed
by averaging the 2004 business student enrollment with the
2008 business student enrollment for institutions that had
data reported for both 2004 and 2008 but none for 2006.
RESULTS
Research Question 1
What were the trends in enrollment of business students at
public, not-for-profit, and for-profit 4-year-and-above institutions between 1996 and 2008? Enrollments of business
FIGURE 1 Total enrollment of business students at 4-year-and-above
institutions 1996–2008. Data from my calculations from Integrated Postsecondary Education Database System data.
students in all sectors of institutions have increased from
1996 to 2008 (see Table 1 and Figure 1). There was a slight
decline in enrollments at not-for-profit institutions in 1998
and 2000 and at for-profit institutions in 1998, but the general trend has been growth with overall enrollments growing
from 1.3 million in 1996 to 2.1 million in 2008.
However, the increases have not been proportionate
among the sectors. The for-profit sector has shown the greatest percentage increase in business student enrollments with
greater than an 850% increase in business students from 1996
(44,952) to 2008 (433,455; see Table 1), whereas public and
not-for-profit institutions reported increases of 40% (from
721,457 to 1,012,747) and 33% (from 507,374 to 675,400),
respectively.
Figure 1 shows the general trends within each sector with
the greatest increases in each sector from 2000 to 2008. By
2008, more than 1 million business students were enrolled in
4-year-and-above public institutions, which was nearly half
of all business students. At this same time not-for-profits enrolled 675,000 business students whereas for-profits enrolled
the smallest number of business students, 433,000. Evident in
this figure is the narrowing of the gap between total business
student enrollments at not-for-profit and for-profit institutions.
Research Question 2
What were the trends in relative market share of business
students at public, not-for-profit, and for-profit, 4-year-andabove institutions between 1996 and 2008? Figure 2 shows
the relative market share of each sector of institution in
each year of the study. Despite the growth in enrollments
in each sector, there was a striking increase in for-profit
market share with a resulting decrease in market share in
the public and not-for-profit sectors. Public institutions enrolled 59% (from 752,456 of 1,272,461) of business students in 2000. Within just 8 years, the public market share
declined to 48% (from 1,012,747 of 2,121,602). Not-forprofit institutions had their highest market share in 1996 at
40% (from 507,374 of 1,273,783). Although hovering around
36% for several years of the study, they have declined to
32% (from 675,400 of 2,121,602) in 2008. By 2008 forprofit institutions enrolled 20% (from 433,455 of 2,121,602)
of the business students at 4-year-and-above institutions,
312
B. K. FOX GARRITY
TABLE 2
Key Players in the 2008 Market for Business Students
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FIGURE 2 Market share of business student enrollment at 4-year-andabove Institutions 1996–2008. Data from my calculations from Integrated
Postsecondary Education Database System data. Percentages may not sum
to 100% due to rounding.
up from a low of 2% (from 44,952 of 1,273,783) in 1998
(see Figure 2).
Institution
Sector
University of Phoenix–Online Campus
Strayer University
American Intercontinental University
Online
University of Maryland–University
College
DeVry University-Illinois
University of Central Florida
Kaplan University
Colorado Technical University Online
Webster University
For-profit
For-profit
For-profit
Ashford University
Arizona State University
City University of New York Bernard M.
Baruch College
2008 Business
student
enrollment
137,553
30,000
19,633
Public
16,304
For-profit
Public
For-profit
For-profit
Not-forprofit
For-profit
Public
Public
15,225
11,842
11,806
11,549
10,898
10,880
10,755
10,692
Research Question 3
Which institutions were the key players in the enrollment
of business majors in 2008? A key player in the market
for business student enrollment is defined as an institution
with greater than 10,000 business students. Table 2 lists the
12 key player institutions in 2008. The top three institutions
were all for-profit, including the University of Phoenix online
campus (137,553), Strayer University (30,000), and American Intercontinental University (19,633). The University of
Phoenix Online Campus enrolled 6.5% of all business students at 4-year-and-above institutions in 2008. This total does
not include the land-based enrollments at the 73 other University of Phoenix campuses located throughout the United
States.
Of the 12 key player institutions, one was not-for-profit,
four were public, and seven were for-profit. These 12 key
players held a combined 14% market share of the business
student enrollments at 4-year-and-above institutions.
DISCUSSION
The relative loss of market share within the public and notfor-profit sectors may not have been evident because each
sector of institution has generally experienced increases in
business student enrollments during the years of the study.
However, those increases have not been great enough to keep
pace with the growth of the for-profit sector.
The compounded annual growth rate of the market of business students has been 4.75% (from 1,273,783 to 2,121,602)
from 1996 to 2008. For-profit institutions as a sector experienced a 22.88% (from 44,952 to 433,455) compounded
annual growth rate whereas public and not-for-profit institutions had a 3.13% (from 721,457 to 1,012,747) and 2.63%
(from 507,374 to 675,400) compounded annual growth rates,
Note. Data from my calculations from Integrated Postsecondary Education Database System data.
respectively, from 1996 to 2008. With annual growth rates
lower than the market growth rate, these sectors of institutions were not taking advantage of the growth of the market
and were losing market share to the for-profit sector.
The increase in market share of for-profit institutions is
clearly related to the growth of one institution (University
of Phoenix), which may be deemed to be atypical of the
for-profit sector (Kinser, 2006b), leading some to ignore the
overall growth rate of for-profit market share; however, the
list of key players contains six other for-profit institutions
demonstrating that dismissing the growth of the sector based
upon one key player would be fallacious.
Three key player institutions are online campuses of forprofit institutions. This could lead to an assumption that most
online business students are enrolled at for-profit institutions
and that the growth of for-profit institutions is driven by a
disproportionate enrollment of online students. The growth
of online enrollments has contributed to the expansion of
the market of business students, with 60% of fully online
business programs reporting increased student enrollments
between fall 2009 and fall 2010 (Allen & Seaman, 2010).
Reports of online course enrollment growth vary, ranging
from an annual rate of 21% (Allen & Seaman, 2010) to 40%
(Lee & Nguyen, 2007). However, for-profit institutions are
not the leader in overall online (nonhybrid) course enrollments. At 4-year-and-above institutions publics have more
than 2.4 million (45%), for-profits have more than 1.6 million
(30%), and not-for-profits have more than 1.3 million (25%)
online course enrollments (Parsad, Lewis, & Tice, 2008).
So, although online enrollments have certainly contributed to the growth of the business student market and
Downloaded by [Universitas Maritim Raja Ali Haji] at 22:05 11 January 2016
MARKET SHARE TRENDS
for-profit provision of business education at online campuses,
growth of online enrollments is not likely the sole reason for
the increase in for-profit market share. Further study of the
changes in online enrollments in business programs by sector
over time is suggested.
The size of the key players in the market suggests the
pursuit of economies of scale in the provision of business
education to minimize expenses. However, at public and notfor-profit institutions, the subsidies provided to students may
discourage many institutions from pursuing the growth rates
needed to see results from economies of scale. On the other
hand, in a for-profit model where there is very little subsidy
of students, increased enrollment can lead to an increase in
revenue and profit making pursuit of economies of scale an
attractive strategy.
Reasons for the Growth of For-Profit Business
Education
Several factors have contributed to the growth of for-profit
provision of postsecondary business education. These factors
are divided between those related specifically to the growth
of for-profit business education and factors related to the
general growth of for-profit enrollments.
Business student enrollment at for-profit institutions have
been influenced by the comparatively low expenses of offering business programs, legal restrictions on the programs
offered, and the relatively high incomes of business program
alumni.
Because business programs generally have lower expenses
than some other programs, maximizing business enrollments
at for-profit institutions is to be expected. The lower expenses
coupled with large enrollments make business programs an
especially attractive target of for-profit institutions.
The pursuit of increased enrollments of business students
at for-profits is related to a combination of legislation and
the higher reported incomes of business graduates. For-profit
institutions are limited by the Higher Education Act of 1965
as amended to offering programs that prepare students for
gainful employment in a recognized occupation. In addition,
a new gainful employment rule announced in June 2011
(Field, 2011) is to compare the income of people who have
been enrolled in each program of a for-profit institution to
the student loan debt held by those former students. If the
results show a high student loan debt-to-income ratio, that
program may lose eligibility to participate in Title IV student aid programs. Because business majors have relatively
high incomes after graduation (Carnevale, Strohl, & Melton,
2011), enrollments of additional business students is not
likely to cause an institution to violate this new gainful employment rule. It can, therefore, be predicted that for-profit
institutions will continue to pursue enrollments of business
students.
Factors related to the general growth of for-profit postsecondary enrollments include aggressive recruitment strategies
313
employed by some for-profit institutions, federal student aid
policies, access to capital, and the customer service focus of
for-profit institutions.
Concerns about aggressive recruitment strategies employed by some for-profit institutions triggered a federal
investigation in 2009. Widespread media coverage of the
investigation and the subsequent modifications to the government’s report documented these practices.
In addition to these practices, financial factors have contributed to growth. Most federal student aid such as Pell
Grants and military tuition benefits are portable and follow
the student to their institution. Periods of growth of for-profit
postsecondary education have been linked to increased access to federal student aid (Bailey, Badway, & Gumport,
2001; Kinser, 2006a, 2006b; Turner, 2006). Increases in Pell
Grants, the temporary allowance of two Pell Grants per year,
and enhanced tuition benefits for military personnel have all
increased the availability of federal student aid during the
years of this study.
Capital is required to fuel expansion plans and increase enrollments. Access to capital is related to the revenue sources
of each sector. Reductions in state and private donations and a
tightening of credit policies have limited the ability of public
and not-for-profit institutions to engage in expansion plans.
For-profit institutions are mainly tuition-driven and have access to capital markets as funding sources for expansion
strategies. The relative advantage of public institutions decreases as direct government subsidies to institutions decline
(Turner, 2006).
In addition to financial reasons, for-profit institutions are
more likely to adopt a customer service approach to attract
students and increase enrollments (Morey, 2004). This may
include course schedules designed to fit around work schedules, assistance with financial aid filings, locations convenient to work and major highways, urban campuses, and a
reduction in general education courses required for a degree
(Kinser, 2006a; Morey).
This approach has been observed in other industries with
mixed-form economies including hospitals and prisons (Hart,
Shleifer, & Vishny, 1997; Picone, Chou, & Sloan, 2002). To
maximize profits, for-profit providers may increase perceived
quality by investing in amenities that are readily observable
such as modern facilities, food services, and equipment while
cutting less observable inputs affecting the quality of the
services provided such as employee compensation levels,
minimum hiring standards, and training. Hart et al. named the
difficult-to-observe quality markers noncontractible quality
because it is difficult for the government to provide a contract
with enough detail related to every facet of the operations
of an institution. Those factors that are not detailed in the
contract are noncontractible and left to the discretion of the
provider. Other examples in education include scheduling,
curriculum requirements, and locations.
As for-profit providers reduce noncontractible quality
and increase markers of perceived quality meant to attract
314
B. K. FOX GARRITY
students, not-for-profit and public providers are pressured
to compete to attract and retain students. This pressure to
compete leads to one of the major implications of these
findings.
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Implications
There are several major implications of the findings of this
study. One of the more serious is the impact that competing
for students with for-profit institutions may have on notfor-profit and public institutions. The practices of customer
service and reductions in noncontractible quality may be
mimicked as institutions compete for business student enrollments. Competition with for-profit institutions influences
decisions at not-for-profit and public institutions (Allen &
Seaman, 2010; Morey, 2004). A 2002 report to the Board
of the Association to Advance Collegiate Schools of Business (AACSB) noted pressure on AACSB schools to offer
programs in different formats to satisfy customer wants and
needs. Emergence of new competitors was cited as the number two factor driving change at AACSB schools of business
(Olian, 2002).
Additional implications include a potential change in the
perceived value of degrees from different sectors; a reduction
of business faculty involvement in shared governance, public service and research activities; and difficulty supporting
higher expense programs at not-for-profit and public institutions.
The perceived value of a degree from a particular institution may be related to the institution’s control. Most public
and not-for-profit institutions hold regional accreditation.
Some for-profit institutions are regionally accredited but
many hold national accreditation. However, accreditation
is not the only indicator of perceived value. Hiring decisions by employers, industry-institution partnerships,
limitations in employer tuition assistance benefit programs,
government funding appropriation decisions, and student
enrollment decisions all provide partial answers to the
question of the perceived value of a degree from a particular
institution.
A pertinent change has been observed in the public perception of for-profit and not-for-profit hospitals. Reports of
fraudulent practices at for-profit hospitals adversely affected
public opinion in the mid-1980s; however, respondents reported that quality was not related to ownership status. However, by 2002 a majority of people surveyed believed that
for-profit hospitals provided higher quality care whereas notfor-profit hospitals had lower costs (Schlesinger, Mitchell, &
Gray, 2004). Several instances of fraudulent or deceptive recruitment practices at for-profit educational institutions have
been reported recently. The trends in the hospital industry
suggest that those incidents soon may be forgotten by the
public and the perception of quality may tilt in favor of forprofit institutions. This could alter the perceived value of
degrees from various sectors of institutions.
The implications for business faculty and their role in
shared governance, research, and public service are of note.
Shared governance is practiced in some form on most not-forprofit and public campuses. However, for-profit institutions
rarely engage in shared governance activities and often
employ more adjunct faculty than other types of institutions
(Morey, 2004). Similarly for-profit institutions generally do
not provide for public service nor do they expect or support
their faculty in research activities (Morey). As business
student enrollments are disproportionately high at for-profit
institutions, full-time faculty jobs, business faculty engagement in shared governance, and overall public service and
research in this field may also be disproportionately reduced
compared with other fields. In addition, the use of centrally
designed curriculum is common at for-profits leaving
teaching faculty with little control over the curriculum and
reducing the need for subject matter expertise of those who
teach.
Financially, public and not-for-profit campuses with business programs may have difficulty in funding higher expense
programs when business students are cherry-picked by the
for-profit institutions. This will lead to a need for increased
revenue from other sources.
Alternatives and Strategies for Change
Business schools have options of how to respond to the trends
in business student enrollments. Several defense strategies
are suggested. Institutions may also choose to increase their
institution’s business student enrollments. Alternatively, institutions may choose to ignore the trends, although this
would likely be an ill-fated long-term strategy.
To defend the role of their own institution, business school
faculty and administrators should establish and communicate
the value of a degree from their institution to maintain credibility with employers, donors, potential students, state and
federal policymakers, and alumni. Specialized accreditation
can be used to establish value. This value should be explained
and reinforced to all constituencies.
Coordinated lobbying efforts should be used to ensure
that state and federal policymakers are familiar with the differences between sectors of institutions. This strategy has
been used heavily by for-profit institutions in response to
congressional actions including legislation changes and investigations.
Policies and standards that limit expansion should be examined to determine if they serve as legitimate protections
for students and learning. If they do, that value must be communicated to stakeholders. If they do not, efforts should be
made to change them.
Market expansion should be monitored and opportunities to expand explored. Business faculty and administrators should lobby for increased funding to expand business
programs if appropriate. Knowledge of the relative expense
levels of programs on campus may assist in these efforts.
MARKET SHARE TRENDS
The value of the research and public service provided by
the full-time faculty and funded in part by the university
must be clearly articulated. This is essential to continuing
funding and distinguishing between institutions in different
sectors.
The most important strategy is to monitor changes in market share. Do not ignore any one sector as all three now hold
a sizeable number of business student enrollments. Careful
monitoring of trends in enrollment will allow each institution
and sector to plan a strategic response.
Downloaded by [Universitas Maritim Raja Ali Haji] at 22:05 11 January 2016
CONCLUSION
The general increases in business student enrollments at each
sector of institution might have masked the dramatic changes
in market share from 1996 to 2008. The changing landscape
of business education in the United States is highlighted by
the dramatic increase in market share held by for-profit institutions and the identification of the key players in the market.
It is imperative that all institutions engaged in educating business students understand and respond strategically to these
changes.
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