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The Imperative of Postsecondary Attainment. January 2010. Educational Attainment has Driven Economic Growth in the United States. Historically, the rising educational attainment of the US workforce has made a huge contribution to national economic growth.
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The Imperative of Postsecondary Attainment January 2010
Educational Attainment has Driven Economic Growth in the United States • Historically, the rising educational attainment of the US workforce has made a huge contribution to national economic growth. • especially during last half of last century • perhaps as much as 25% of growth in labor productivity was attainment-based; and Indirect effects even greater. • But, now we have entered a time of declining educational attainment that inevitably will drag down national economic growth.
Confluence of Two Demographic Factors Drove Increase in Workforce Attainment Huge increase in the number of workers • From 1960 to 2000, number of workers in prime productive years (25-54) increased by over 120% • Growth was driven by the baby boom and increased percentage of women in the workforce. New workers more highly educated than their elders • 1960: only 41% of adults had HS diploma and less than 8% had BS degree or higher • 2000: Over 80% of adults had HS diploma and 24% had BS or higher Result: As cohorts of less educated older workers aged out of workforce, they were replaced by larger cohorts of more educated younger workers and overall attainment soared.
But Labor Force No Longer Growing Rapidly Labor force impact of baby boom peaked in the 1990s and, from 1990 to 2000, the number of new young workers actually fell. From 2000 to 2040, workforce will grow less than 30%, way down from 100% + rates of past 40 years. Number of workers in their prime age 25-54 will increase only 16%, even more dramatically down from the 120% of past 40 years. Further, labor force participation rates are now on the decline.
That’s Only Half the Story Education attainment began to level off in late 1980s and has remained flat. • High school graduation rates down from the 1970s, ’80s, and ‘90s. • College entrance rates are stagnant. • College completion rates have decreased. From now forward, those aging out of the labor force will be more educated than those entering. Younger age cohorts are more racially and ethnically diverse with greater numbers from groups historically not well served by public education.
Attainment Levels On The Decline If current trends continue, inevitable result will be significant erosion in the average education level of the U.S. labor force. The percentage of the labor force with less than a high school diploma will grow over the next 20 years. Accompanied by decreases in the fraction of the population that will have earned higher-level credentials and degrees. Wild cards? Changes in immigration policies and the “geezer factor.”
Running the Numbers: We Better Focus on Working Adults In 2002, about 4.1 million kids were in the 9th grade. In 2006, about 3.1 million graduated from high school. That fall, about 1.9 million first-time, freshmen right out of high school enrolled in college. In the fall of 2007, 1.5 million returned for their 2nd year • 4-year colleges 6-year graduation rate – 53.4% • 2-year colleges 3-year graduation rate –20.0% Bottom Line: We can’t get enough young people through college to replace the college-educated older people who are leaving the workforce.
Working Adults About 125 million adults (25-64) in U. S. labor force: • About 53 million have a college degree (associate’s, bachelor’s, or advanced); • Another 22 million have “some college, no degree” • Say one-third have a one-year certificate or industry recognized certification, • Other two-thirds started college, but dropped out with no credential. • 12 million did not complete high school • Of 62 million adults now without a postsecondary credential, fewer than 500,000 are getting one each year.
What Are the Challenges to College Completion for Working Adults? Almost all colleges (including community colleges that enroll majority of adults) are organized for traditional students unencumbered by family and financial responsibilities. OK for students with good information-gathering and planning skills or good access to them (parents, siblings and friends) able to navigate their way effectively through multiple choices about which courses at which time and in which sequence. OK for students able to attend classes mostly during the daytime and with plenty of time to explore career and program options.
But in Some Community Colleges a New Model is Beginning to Emerge Accelerating and contextualizing basic skill remediation; Compressing the classroom time and shifting more instruction to asynchronous, technology-based, hybrid courses; Balancing pace and intensity through shorter terms and fewer courses at a time; Embedding student support services in the program; Putting soft skills into the program structure; Demanding more employer involvement and tighter labor market connections; Eliminating the complexity of registration, course selection, and scheduling; and, Targeting enrollment marketing to adults and their employers
Back to the Numbers:National Challenge is Regional Opportunity There seems almost zero likelihood of any transformation in national commitment or federal policy that will turn these trends. But… The decline in overall education attainment will play out very differently across the country. In metropolitan education as in metropolitan economic growth, the most dramatic trend is growing heterogeneity – regions are becoming more dissimilar in many ways, but especially in the education attainment of their population. How a region positions itself for gain in the face of these national trends toward decline can have a huge impact on regional growth, equity, and sustainability.
Attainment Influences Regional Distribution of Growth and Incomes Research has found that, between 1980 and 1998, the 10 regions with most college graduates experienced per-capita income growth of 1.8 percent annually, while those 10 with the fewest college graduates saw an annual income growth of 0.8 percent. Further, most-educated regions enjoyed productivity growth of 0.5 percent per year, compared with growth of 0.1 percent for the least-educated cities. (Gottlieb and Fogerty, 2003)
The Gap Between More-Educated and Less-Educated Regions is Getting Wider 1980 The average per-capita income in the 10 most educated regions was 12 % above the U.S. average The average per-capita income in the 10 least educated regions was 3 % below the average. 1998 The most-educated regions had average incomes 20 percent above the national average. The average incomes in the least educated regions had fallen to 12 percent below the national average.
What Does This Mean for Your Region? Cities with higher levels of education have higher incomes and faster rates of income growth. Not a generational problem: Per the Talent Dividend study, modest increases in attainment, feasible in a 3-5 year period, can drive big gains in regional income and productivity. No matter where you begin, attainment increase drives growth. In the 1990s, each 2 percent increase in the fraction of the population with a college degree was associated with a 1 percent increase in personal income growth. Attainment Growth benefits the whole region. Each 10 percent increase in the fraction of a region’s population with a four-year degree has the effect of increasing wages 8% at every education level.
Four Critical Metrics of Postsecondary Attainment On-Time High School Graduation Rate College Continuation Rate Adult Postsecondary Participation Rate College Completion Rate If we can move the needle on any one of these (just holding the others constant) we can increase postsecondary attainment. If we can move the needle on all four of them, we begin to make a difference that will affect income and productivity growth in our regions.
On- Time High School Graduation Rate Different ways to measure high school graduation rates: States have agreed to a common measure: the percentage of first-time ninth graders who earn a regular diploma four years later, adjusting the denominator for net transfers. Not all there yet. You can use America’s Promise Cumulative Promotion Index because it allows consistent comparisons.
High School Graduation Rate For State to State Comparisons State Level Data from NCHEMS Information Center (Method of estimation: Number of 9th graders/High school graduates four years later (public high schools) 19902006 National Average 71.2 68.6 Average of Top 5 States 87.7 84.1 Average of Bottom 5 States 60.7 54.9 Ohio 74.0 74.3 Ohio Rank Among 50 states 27th 23rd Access at http://www.higheredinfo.org/ * http://www.higheredinfo.org/
College Continuation Rate For State to State Comparisons State Level Data from NCHEMS Information Center (Method of estimation: Number of first-time freshmen who graduated from high school in the past year from state X enrolled anywhere in the U.S. divided by the total umber of public and private high school graduates in state X.) 19922006 National Average 54.3 61.6 Average of Top 5 States 64.0 73.3 Average of Bottom 5 States 41.4 46.1 Ohio 50.3 60.0 Ohio Rank Among 50 states 41st 33rd Access at http://www.higheredinfo.org/ * http://www.higheredinfo.org/
9th Graders Chance for College By Age 19 Number of fall first-time freshmen enrolled anywhere in the U.S. in 2006 divided by the number of 9th graders 4 years earlier.* 9th graders chance for college National Average 41.8 Ohio 44.6 (19th) Average Top 5 States 57.2 Average Bottom 5 States 30.1 • From NCHEMS Information Center
Postsecondary Participation of 25-49 Year Olds Percentage of 25-49 year olds enrolled in postsecondary education 2007 • National Average5.6 • Ohio 4.9 (34th) • Average of top 5 states 9.9 • Average of 5 bottom states 3.8 Using data from American Community Survey, this information can be compiled region by region
2-Year College 150% of Time Completion Rates In 2008, of a cohort of 15,714 first-time, full-time students enrolled in certificate or Associate’s degree programs in public, degree-granting 2-year colleges in Ohio, 2,200 of them obtained a credential within 150% of the “program time.” Ohio Rate 14.0 % National Rate* 20.0 % * 1019 similar institutions futureworks | PDC Comparative Research
4-Year College 150% of Time Completion Rates In 2008, of a cohort of 41,389 first-time, full-time students enrolled in degree programs in public, degree-granting 4-year colleges in Ohio, 21,413 of them obtained a credential within 150% of the “program time.” Ohio Rate 51.8 % National Rate* 53.2 % * 692 similar institutions futureworks | PDC Comparative Research
Back To Those Four Critical Metrics On-Time High School Graduation Rate College Continuation Rate Adult Postsecondary Participation Rate College Completion Rate If we can move the needle on any one of these (just holding the others constant) we can increase postsecondary attainment. If we can move the needle on all four of them, we begin to make a difference that will affect income and productivity growth in our regions.
Let’s Summarize Education attainment has driven national economic growth. But advantageous trends of 1960-2000 have turned; we now face slow labor force growth and stagnant education attainment. Can’t leave any of our young people behind but we also need to focus on working adults without postsecondary attainment . Getting these adults to postsecondary credentials will require new strategies. In the face of a national challenge, there is regional opportunity. Focus your community on the critical metrics of education success.
