Why Private Schools Are Dying Out

A few elite institutions at both the grade-school and college levels are doing better than ever. But their health conceals the collapse of private-sector options in the U.S.

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Private education as we have known it is on its way out, at both the K-12 and postsecondary levels. At the very least, it's headed for dramatic shrinkage, save for a handful of places and circumstances, to be replaced by a very different set of institutional, governance, financing, and education-delivery mechanisms.

Consider today's realities. Private K-12 enrollments are shrinking -- by almost 13 percent from 2000 to 2010. Catholic schools are closing right and left. The Archdiocese of Philadelphia, for example, announced in January that 44 of its 156 elementary will cease operations next month. (A few later won reprieves.) In addition, many independent schools (day schools and especially boarding schools) are having trouble filling their seats -- at least, filling them with their customary clientele of tuition-paying American students. Traditional nonprofit private colleges are also challenged to fill their classroom seats and dorms, to which they're responding by heavily discounting their tuitions and fees for more and more students.

Meanwhile, charter school enrollments are booming across the land. The charter share of the primary-secondary population is five percent nationally and north of twenty percent in 25 major cities. "Massive open online courses" (MOOCs) are booming, too, and online degree and certificate options proliferating. Public-sector college and university enrollments remain strong and now educate three students out of four. The "proprietary" (i.e. for-profit) sector of postsecondary education is doing okay, despite its tortured relationship with federal financial aid.

What's really happening here are big structural changes across the industry as the traditional model of private education -- at both levels -- becomes unaffordable, unnecessary, or both, and as more viable options for students and families present themselves. While unemployment remains high, the marginal advantage of investing thirty or fifty thousand dollars a year in private schooling is diminishing, particularly when those dollars are invested in low-selectivity, lower-status private institutions. Recent analyses by AIR's Mark Schneider and Brookings's Stephanie Owen and Isabel Sawhill make it explicit:

People who attended the most selective private schools [colleges/universities] have a lifetime earnings premium of over $620,000. ...For those who attended a minimally selective or open-admission private school, the premium is only a third of that....[P]ublic schools tend to have higher ROIs than private schools, and more selective schools offer higher returns than less selective ones.

Alterations in the housing market may also play a role where K-12 private schools are concerned. Not long ago, one could live in a nice house in the city for a lot less than a nice house in the suburbs -- and spend the money saved on private schooling for one's kids. In gentrifying cities, however, that's no longer so. Now one must pay more for a house in the city plus private school for the children. Thus, more parents are saying, "Forget it, I'll go public -- provided the public sector can be made to supply me with a good charter or magnet school, or a virtual-education supplement to a decent neighborhood school."

Three factors keep all these changes from being more visible and talked about.

First, of course, they're gradual, and thus (proverbially) difficult to perceive. Second, it's not in the interest of private schools or colleges to acknowledge that they have a problem -- lest it create the educational equivalent of a run on the bank, with clients fleeing for fear of being abandoned after a sudden collapse. Much of the allure of private schools, after all, is based on their reputations, which they work hard to sustain. Hence they maintain a brave front while quietly shrinking, discounting -- and recruiting full-pay students from wealthy families in other lands, particularly in Asia.

Third, elite private institutions are doing just fine, many besieged by more applicants than ever before. The wealthiest Americans can easily afford them and are ever more determined to secure for their children the advantages that come with attending them. And at the K-12 level, a disproportionate fraction of those wealthy people live in major cities where the public school options are unappealing. So we're not going to see an enrollment crisis anytime soon at Brown, Amherst, or Duke, nor at Andover, Sidwell Friends, or Trinity. Indeed, New York's new Avenues School is able to fill its classes with families willing and able to pay its staggering $43,000 per annum.

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Chester E. Finn Jr., a former assistant secretary of education under Ronald Reagan, is a senior fellow at the Hoover Institution and the president of the Thomas B. Fordham Institute. More

Chester E. Finn Jr. has been involved in national education for 35 years. Currently, Finn serves as president of the Thomas B. Fordham Institute and is senior editor of Education Next. He is also a senior fellow at Stanford’s Hoover Institution and chairman of Hoover’s Koret Task Force on K-12 education. Previously, he served as a professor of education and public policy at Vanderbilt University, counsel to the U.S. ambassador to India, legislative director for Senator Daniel Patrick Moynihan, and assistant U.S. secretary of education for research and improvement. He holds a doctorate from Harvard in education policy.

The author of 19 books and more than 400 articles, Finn’s work has appeared in The Weekly Standard, Christian Science Monitor, Commentary, The Public Interest, The Wall Street Journal, The Washington Post, The New York Times, Education Week, Harvard Business Review, and The Boston Globe. Finn is the recipient of awards from the Educational Press Association of America, Choice magazine, the Education Writers Association, and the Freedoms Foundation at Valley Forge. He holds an honorary doctorate from Colgate University. He and his wife, Renu Virmani, a physician, have two grown children and three granddaughters. They live in Chevy Chase MD.

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