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Federal Funding For Programming Bootcamps
The government should aspire to raise the standard of the industry, not merely degrade them with cheap money. Throwing money at the problem will not solve the real issue, the need for a reliable talent pipeline.
Hungry for more
“Software is eating the world” bellowed Marc Andreessen, the venerable venture capitalist. It seems these days that no market is too large or immune from the tech industry’s voracious appetite, except one, the labor market. Demand for talent is skyrocketing, especially in tech hubs like San Fransisco and New York City. According to estimates by PayScale.com, a jobs and labour market analytics company, entry-level developers can make a median salary of over $USD70,000 a year. Career salaries can range from $USD60,000 to $USD160,000, according to AngelList, a popular jobs board for software developers, (see: https://angel.co/salaries). Georgetown Center for Education and Workforce reports that a salary of $USD72,000 is 72% higher than those with earned by men with associate’s degree. Yet, with all this demand, the industry cannot seem to find enough bodies.
In a zeal to seem proactive, the United States federal government is launching a pilot program to allow federal funding to be used at non-traditional educational providers that partner up with accredited higher education institutions. However, it is confusing the nature of the problem and in doing so, opening the door to abuse. The question is not “How can we expand availability to programming boot camps?”. Rather, it should be “How do we help maintain a high standard for our talent pipeline in a consistent manner?”. In arriving at the wrong conclusion, the government is opening the door to the same issues that have plagued the for-profit higher education industry.
Many companies complain that although there are many university graduates in computer science, the universities do not teach the current skills that they need. Talent, not people are in short supply. As a result, a new industry has arisen to fill the skills gap and treat software development more as a vocational study than an academic subject. “Programming bootcamps” are three to six-month schools which promise to teach aspiring software developers the modern skills required to enter this fast-moving industry. The costs can range from $USD10,000 to $USD18,000, yet with bubbling salaries in an industry known for outrageous perks, many see this is a cost worth bearing.
A second glance at a second chance
The federal government’s plan at first inspection seems like a logical choice. By offering to finance to those students who wish to better their lives with much-needed skills, both society and the individual win. Yet, in want of a solution to the hiring crisis and limited paths to the middle class, the government’s is bumbling towards the wrong solutions.
The problem is not the lack of people training to become software engineers, but the reliability of the talent pipeline. The industry’s problems are not solved by having more people with subpar skills from a dubious programming bootcamp enter the labour market alongside those ill-prepared from the university. The government’s solution also ignores the fact that the programming bootcamp industry itself has already solved the issue of financing.
There are companies like Pave and Upstart which virtually approve every loan for certain selective boot camps. One such program, Fullstack Academy of Code, a Y Combinator funded bootcamp based in New York, boasts that anyone admitted to their program will have their loan guaranteed. The selectivity is determined not by capital constraints, but by the barrier of independent study needed beforehand. No company will loan to a bootcamp whose graduates can’t find jobs to pay back the loan. As a result, there is considerable pressure on these bootcamps to deliver an excellent education.
App Academy, a programming bootcamp with schools in San Francisco and New York, charges 17% of a graduate’s first-year salary if they find a job. The school boasts graduation rates of 98% and salaries from $90,000 a year and above. Students are rigorously tested weekly with anyone that fails the inquisition asked to leave the program. Acceptance rates are below 10%. Other programs like the Hack Reactor charge upfront but, its graduates have found similar success. The common factor in all the most successful bootcamps which deliver on their promise is an emphasis on study skills before applying. Hack Reactor, boasts that it “is not a ‘0–60’ course, this is a ‘20–120’ course”. This acts as a mechanism to weed out those that cannot endure the gruelling pace of study, as well as those who cannot take the initiative to learn on their own.
A Deluge of Knowledge
Access to materials is not a problem. In the era of Google, where all the world’s information is at your fingertips, there are a plethora of resources that students can use to get up to speed. If a prospective boot camp student studies enough, he or she may not even need a loan for programming bootcamp. One of these resources is FreeCodeCamp.com, a year old free online programming boot camp which seeks to provide as good an education as many pricer outfits. The founder, Quincy Larson, has previously mentioned an instance of many students finding jobs as developers before completion, (see: http://freecodecamp.com/stories). As an open-source initiative, the group enjoys a committed and growing base, consistently pumping out new instructional material. Another online provider of online programming education, teamtreehouse.com, charges from $25-$50 a month for courses related to web and mobile development with various technologies. Although the company does not boast an active jobs placement service, the skills learned in the course are comparable to many bootcamps.
Then there are MOOCs, shorthand for Massively Open Online Courses, which have exploded in popularity in recent years. The two leading providers, Coursera.org, a Silicon Valley-based startup, and Edx.org, a joint venture Harvard and Massachusetts Institute of Technology, provide high-quality university education on subjects as technical as Machine Learning to esoteric as the Science of Happiness. As their name implies, these courses are free and open to anyone with an internet connection and computer. However, the majority of courses are taken by those who already have a bachelor’s degree. The current completion rates are less than promising, at a whopping 10%. Although the industry is in its nascent stages and vows to increase retention, throwing money at the problem by the federal government at this moment won’t boost retention rates.
Back to the future
As Barmak Nassirian, director of federal relations and policy analysis for the American Association of State Colleges and Universities asks “What happens once you turn on the federal spigot?”. The answers can readily be found in the for-profit education sector, where federal government oversight is sporadic at best. The results as measured by the cost of education, default rates, graduation rates and earnings after are dismal, to say the least.
According to a report with federal data by the Education Trust, an outfit partially funded by the Bill and Melinda Gates Foundation, (see: “Subprime Opportunity,”), only 22% of first-time bachelor degree students graduate within the first six years of attending as compared to 55% and 65% of students in public and private institutions respectively. Among the University of Phoenix’s online students, only 5% graduate on time. Those in its Kansas campus graduate are even lower, with only 4% making the cut. Of those attending for-profit schools, almost one-quarter of students have loans of over $USD40,000 or more as compared to 5% in public and 15% at private institutions.
Even as the for-profit college industry is caving under pressure to reform, many are now investing programming boot camps as a potential cash cow with sweeteners of cheap federal money. Kaplan has invested in Dev Bootcamp, whose program promises to turn people into developers within 25% less time than the average boot camp, at nine weeks instead of twelve. In June the Apollo Education Group, the parent group of the University of Phoenix, announced that its investment in Iron Yard, a programming boot camp with 25 locations scattered across the United States. The profits are juicy.
Iron Yard charges students $USD12,000 for three months of instruction. Compared with a year’s tuition at the University of Phoenix’s online course and without its recent stigma, the profit potential is enormous. Estimating 30 students each paying $USD12,000 every 3 months comes out to $USD1,440,000 for each site. On Iron Yard’s site, the school promises that every student is employed, yet does not delve into statistics. This is similar to a practice common in many law schools in America, another institution producing a surplus of graduates at high costs, where the schools hire their students for the period requiring reporting.
The federal government’s plan calls for Quality Assurance Entities (QAE) which will provide oversight and proper inspection on the effectiveness of the program. Yet, how effective the current organisations regulating these institutions are or how effective Quality Assurance Entities will remain questionable. As Nassirian states, “Everybody’s in charge means no one is in charge”.
There are some green shoots of hope arising from institutions with stellar track records. Massachusetts Institute of Technology, a renowned Cambridge, Massachusetts based research university, is launching an initiative to offer Micro Master’s degrees with Edx, its online outfit (see: http://micromasters.mit.edu). Its hope is to have students divide their time between the campus and online in hopes of lowering the cost of education. Georgia Tech, another renowned research university, is partnering up with Udacity, a Silicon Valley-based MOOC provider, to offer an online master’s degree in computer science for only $7,000. The real danger is in allowing providers with already dismal records supervise programming boot camps with the taxpayer on the hook.
The Ironies of Iron Yard
There are two ironies to this initiative. The first is obvious. The government states that the self-selection bias is due to affordability. It assumes that just because a person enters training means that they will have a stable career in the future. Over the long term, there will still be a self-selection bias as to who stays in the industry. In a fast-moving sector with ever-changing skills, today’s skills can and will quickly fall out of fashion. Although programming bootcamps may give students the necessary tools to enter the workforce immediately, only solid perpetual study habits can guarantee any aspiring developer to make a career out of it. Advancement to higher levels of responsibility requires a programmer to eventually understand fundamental concepts such as algorithms, data structures and the mathematics behind computer science. Due to time constraints, many bootcamps today do not have enough time to fully cover these key topics. Those that did not have the study skills before and cannot quickly adapt will see themselves out of a job.
The second irony is the federal government’s initiative also has a ring of amnesia surrounding it. If poorly implemented it could create the same conditions which pushed for the creation of MOOCs in the first place, namely easy cheap money flooding into the educational sector which pushed up costs while lowering quality. Though to be fair, state governments in a zeal to cut taxes slashed education budgets and pushed the burden on students to take out more loans.
A linter for linty pockets
If the government wishes to help, it should push for higher standards, not more money. It should require any program that takes federal funds to publish their graduation rates, the complete salary information of their graduates and follows their careers for at least five years. Those that take the federal money must report their career trajectories and salary information or risk paying a higher rate. All the data should be publically available on all the institution’s websites to increase transparency. This includes for-profit universities, programming boot camps, and MOOCs.
For a great deal of Americans, living check to check is a grim reality. If the government truly wishes to help those who cannot attend a program due to economic constraints, it should subsidize a living stipend for those who are accepted into an upstanding program. An upstanding program could be defined as those being in the upper 25% of all programs. The stipend should be indexed to the region where they are studying in the form of a loan at a low-interest rate, payable with 10% of the person’s check over a five year period. At the very least, the government should focus on better oversight of the education programs it is currently funding now. Or it can simply just stay out of the way and focus on the less exotic, but more essentials task it is already undertaking.
It should invest it into universal pre-kindergarten education which is cited to be a bigger bang for their buck. It should push for higher livable wages. It should push for schools from Pre K to High School to teach computer science along with math. It can even focus in its own house and take a deep look at how the school district raises its money based on property taxes and expand school choice. The federal government should right the institutional failure of federal agencies, namely Housing and Urban Development (HUD), who do not enforce their anti-segregation policies but still disburse monies to offenders. By making the same mistakes in offering money to the for-profit educational complex without accountability, the federal government is hurting the students and industry it’s seeking to help. Ironically, it was this loose approach that led to the bootcamp model in the first place.
So what could you get when you throw nearly free money at a poorly understood problem? One new New York City-based boot camp, penpapercoding, boasts teaching “ core concepts of programming without any of the distractions that occur when using a computer too early on in the learning process”. Let’s hope the prospective student, as well as the government, aren’t distracted by the promise of these shiny computers early in the learning process either.
Even after graduation, it always pays to do your homework. Sometimes it also saves.
