Job Guarantees: Solid Strategy or Marketing Ploy?
Recently, Udacity rolled out its “Job Guarantee.” Earn a nanodegree credential, the company says, and you will have a job within six months or receive a 100% tuition refund. This idea has gotten a lot of media attention — after all, it falls right in line with themes I’ve been hammering home, about proving your ROI to students, developing vocational education, and considering outcomes as an important part of an educational program. So at first blush, this might seem like an idea I strongly support. But when you take a deeper look at these kinds of guarantees (and Udacity is not the only program offering this), there are significant flaws that I think are really important to highlight.
While Udacity is not a coding bootcamp, per se, it has a lot in common with these intensive, skills-based programs. I sat down with Eric Wise, founder and Chief Academic Officer of The Software Guild, a coding bootcamp owned and operated by Learning House, to discuss what these guarantees are, and if they can live up to their promises.
How do the guarantees work?
Most of the guarantees offer your tuition back after a period of time post-graduation. Naturally they require you to be an active job seeker who is willing to accept job offers. On the surface, this looks great! But having a career where I spent a lot of time coding insurance claims systems, I tend to be a bit skeptical of rosy claims and I have learned the hard way that nothing in life is guaranteed.
What do they mean by “job?”
At the Guild, we define a job as a full-time engagement in an IT position related to software development. The vast majority of our alumni are working as software developers, though occasionally we have someone who likes testing, database, or business analyst work and takes one of those roles. But for these money-back guarantees, very few clearly define up front what constitutes a job. Some offer a salary floor, while others list out different types of jobs. By not defining what a job is, claims of job placement easily can be inflated — does a low-paying internship count? How about a 2-month stint as a contractor?
What are the drawbacks of the money-back guarantee?
I’ve seen over and over in my career that money creates incentives. Refunding 100% of a student’s tuition if they graduate and can’t find work is a powerful incentive for the company offering it. The problem with incentives, though, as seen with the Corinthian College scandal, is that they don’t always encourage good behavior. It can be tempting for bootcamp providers to hire their own graduates or pay employers to hire graduates, both of which inflate job placement numbers but can put students in tricky positions. If a provider is hiring its own graduates, that’s an easy way to claim everyone has a job, but that’s not necessarily a role that fits their skill set. Perhaps we need to start looking at retention rates in terms of job placement — how long are graduates staying in jobs once they are hired? That can be one measure of job placement quality.
Companies that offer a money-back guarantee have a very strong incentive to get you into any job, regardless of the fit. You see this in many of the guarantees having fine print that requires you to blast your application to x employers per week and be willing to relocate all over the country for work. And if you don’t want to live in that city… well, you aren’t getting your tuition money back.
What’s the problem with guaranteeing a job? Don’t bootcamps teach anyone to code?
Because coding can be self-taught, there is a myth that anyone can do it. What people don’t realize is that coding at a professional level is not for everyone. Some people do not have the aptitude, some people do not have the interest, and some people do not have the drive to work as hard as we do in the bootcamp. We require students to work hard, to sacrifice a lot, and to commit to our program. Not everyone can, or should, do that.
But for the programs with money-back guarantees, they require you to graduate. In short, what a guarantee like this is saying is what everyone in the bootcamp industry already knows: If you have the required skills, it’s highly likely you’re getting a job. But if you do not have the aptitude, how long will you flounder and burn through tuition money before failing out of the program and walking away empty-handed?
If you’re not going to guarantee a job, how can you make your bootcamp stand out?
Job guarantees are a great marketing gimmick, and a good way to get quick attention. But they don’t have a lot of lasting power — like I said above, these jobs can be low-paying internships, short-term contracts or other kinds of gigs that aren’t really “jobs” in the way we want people to define it. I think by focusing on offering a high-quality product, making sure that the incoming students are qualified and make good peers, touting our actual job placement rate, and being honest and transparent with people, we are able to still stand out. And of course, we get to do that in a way that aligns with our values. I think that kind of transparency is really meaningful to potential students.
Is there ever a good time to offer a guarantee?
Sure. In some limited, specific scenarios, I think a guarantee can be a good thing. To be honest, when we first launched Software Guild, we had a job guarantee. But the most surprising thing to me was not the ethical issues it raised. It was the fact that the guarantee, which we thought would be a motivator for students, actually decreased their sense of personal responsibility. They knew we would do the work for them, and so they were less inclined to work as hard as they needed to for their own success. My feeling is that when you’re launching a program, offering a scholarship is a better incentive to get motivated students.
So, if you don’t offer a job placement guarantee, what do you offer?
Well, we offer assistance and knowledge. We will help students with their job search. That’s actually a big part of our program. At The Software Guild, we have a robust (and growing) employer network, so we give our graduates access to employers and jobs. We also offer soft skills training, like how to develop a LinkedIn presence, how to interview well, and how to behave on the job.
In addition, we focus on teaching skills that are needed in the workplace. That helps our graduates bring value from their first day on the job. Not only does that help in the short term, because those students have the skills to get hired, but it helps in the long term. We have a reputation for graduating only those with the ability to do the job we say they can do. Employers trust us, and are more likely to look favorably on our graduates, because they know the quality they are getting. Because we don’t take money from employers or have a financial incentive to graduate students who can’t do the work, we can put our effort into finding the best match, not the most profitable one. It’s something I take a lot of pride in, and something we remain committed to.
That’s it. We won’t put a guarantee up with a bunch of red tape to protect our revenue and give incoming students a false sense of security. But we will teach students the skills needed to succeed as entry-level developers, and we won’t overpromise in a quest to get tuition dollars. And really, that’s all we can do.
