PPIC Higher Education Center – Page 11 – Public Policy Institute of California

Bricks and Mortarboards: Capital Investment in Colleges

PPIC has documented California’s need to increase the number of resident college graduates to meet the economy’s future needs. While the state’s public higher education systems are taking steps to increase the number of students who complete their degrees in a timely manner, these improvements alone will not fill the gap. At some point, the UC and CSU systems will have to expand their capacity, and such an expansion is likely to require long-term capital investment in buildings, technology, and campus infrastructure.

It is important to note that capital investment encompasses more than new classrooms or dormitories. Earlier this week, the College Futures Foundation released a report by Patrick Lenz in which the California Community Colleges, the University of California (UC), and the California State University (CSU) estimate that they will need a combined $47.2 billion to modernize and maintain their facilities in the next five years alone. Their needs include ensuring the safety and accessibility of aging buildings and investment in the less visible systems—heating, cooling, electrical, and water—that enable a campus to function.

A look at some historical data suggests that economic pressures and policy decisions have led California to underinvest in higher education infrastructure over the past decade compared to four other large states. From 2005 to 2015, the period for which we have data, state support for capital investment in both California and Florida dropped sharply as a consequence of the Great Recession. Interestingly, New York increased its support, while support in Pennsylvania and Texas stayed the same.

In 2000, California voters approved Proposition 39, which makes it easier for community colleges to pass bond measures. Since then, local community college districts have been relatively successful in funding their capital needs. The state’s four-year universities, however, face a different situation. To compare how much UC and CSU spent (per student) on maintaining and operating their campuses between 2005 and 2015, we separated and compared each system to a nationwide group of similar institutions. As the state cut its investment in higher education infrastructure, UC cut its infrastructure spending dramatically, while CSU’s spending remained relatively constant. But average maintenance spending by both systems was significantly below that of their peers.

These comparisons suggest that California has been systematically underinvesting in its higher education infrastructure, at least at its four-year public universities. Even if California were not facing a degree gap, it could benefit from rethinking its higher education capital finance strategy. But a new approach becomes imperative when one considers that larger shares of high school graduates are expected to complete the a–g requirements and that many of those students will seek admission to UC and CSU. Efforts by the state’s community colleges to increase the number of students who transfer to four-year institutions will also heighten the need to expand capacity, necessitating further capital investment.

Over the coming months, PPIC will be focusing on capital finance, a key component in maintaining access for all students and producing an educated workforce. We hope to inform state decision making in this critical area.

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Video: Keeping Students on Track for College

Only about 30% of California 9th graders are expected to earn a bachelor’s degree—a startling statistic in a state that faces a shortfall of college graduates. A new PPIC report finds that the vast majority fall off the path to a college degree in the last two years of high school or the first two years of college.

Report coauthor Niu Gao presented the analysis in Sacramento last week, along with recommendations for tackling the problem. Among them: updating high school graduation requirements, offering more of the college preparatory courses required for admission to California State University (CSU) or the University of California (UC), and improving placement policies in both high schools and community colleges to ensure that students take the classes needed to progress.

Gao’s presentation was followed by a panel discussion among experts who work in this area. In a conversation moderated by Hans Johnson—report coauthor, and director and senior fellow at the PPIC Higher Education Center—participants touched on challenges, as well as potential solutions.

Jorge A. Aguilar, superintendent of the Sacramento City Unified School District, noted that while more students are completing college prep courses—known as a–g courses—many aren’t making it to or through college. Part of the problem, he said, is the “fundamental disconnect between K–12 and higher education.” Having worked in both sectors, he noted there are insufficient incentives for school districts to focus on persistence in higher education and for higher education to work with K–12 on the issue.

Kimberly Rodriguez, chief education advisor to Kevin de León, state senate president pro tempore, addressed one of the report’s key recommendations: increasing state high school graduation requirements in math. She noted that requiring a–g courses for graduation has been much discussed at the state level.

“The biggest barrier has always been money,” she said. “Because once you require it, the state is on the hook.” Implementation is also complicated, she said, requiring planning and attention to infrastructure—as districts that have already adopted these requirements have found.

The third panelist, Jim Dragna, talked about a promising initiative. Known as the “graduation czar” at CSU Sacramento, he supervises the Finish in Four program. Students are asked to pledge to take 15 credits a semester—the number needed to graduate in four years—and are provided extra resources to ensure they stay on track.

“Student progression problems have been with us so long that they’ve become part of the culture,” he said. So, he continued, “we tackled the culture.”

Learn more
Read the report Improving College Pathways in California
Visit the PPIC Higher Education Center

California Needs More College Prep Courses

Most California high school graduates are not ready for college. Despite the steady improvements over the past decade, less than half of graduating seniors in the class of 2016 completed the a–g requirements, the set of courses high school students must complete to be eligible for admission to the University of California (UC) or California State University (CSU). The completion rate is substantially lower among Latino (37%), African American (34%), economically disadvantaged (37%), and English Learner (10%) students.

PPIC’s new report looks at the role of several institutional factors that may improve the completion rate, including high school graduation requirements, course placement policies and practices, and academic counseling and advising. But there is another significant barrier: not every high school in California offers the full a–g course sequence.

During the most recent school year (2016–17), 12% of California high schools did not offer the full math sequence, which includes algebra 1, geometry, and algebra 2. Similarly, 14% of high schools did not offer four years of a–g approved English courses. High-poverty schools (where more than 75% of students are eligible for free or reduced-price lunch) and high-minority schools (where more than 75% of students are African American or Latino) were just as likely as schools overall to offer the full sequence. But small schools (those at the bottom 25th percentile of the enrollment distribution) and rural schools were much less likely to do so. Close to 40% of small schools did not offer the full science sequence, which includes two years of approved science courses, and more than a third did not offer the full math or English sequence.

The difference in course offerings has contributed to low a–g completion rates at small and rural schools. For instance, the average a–g completion rate is 46% among all high schools, but only 30% or so among small or rural schools.

To improve student readiness for college, districts and schools need to increase the number of a–g approved courses. However, some schools may face capacity and resource limitations, such as not having enough qualified teachers. One solution is to establish a regional or statewide virtual school network so students in small or rural schools can enroll in online courses offered by other districts. Several states—including Florida (Florida Virtual Education), Wisconsin (Wisconsin Digital Learning Collaborative), Texas (Texas Virtual School Network), and Georgia (Georgia Virtual School)—have in recent years partnered with school districts to provide academic courses and test prep for all middle and high school students. California’s UC Scout program is a step in the right direction, providing a full set of online a–g courses accessible at no cost to students at participating schools.

Learn more
Read the report Improving College Pathways in California
Visit the PPIC Higher Education Center

College Graduates and California’s Future

The University of California Board of Regents invited Mark Baldassare, PPIC president and CEO, and Hans Johnson, PPIC senior fellow and director of the PPIC Higher Education Center, to present their perspectives on the role of higher education in California’s future, November 16, 2017. Here are their prepared remarks:

Good morning, I am Mark Baldassare, president and CEO of the Public Policy Institute of California (PPIC). I am here with my colleague and PPIC’s higher education center director Hans Johnson to present the institute’s research findings on the need for college graduates in California’s future economy. To kick off this session, I am going to make a few remarks about public opinion to place this issue in perspective.

The November PPIC Statewide Survey points to the importance of this topic for most Californians. Eighty percent of California adults say that the state’s higher education system is very important to the quality of life and economic vitality of the state, and another 14% say it is somewhat important. Strong majorities across political, regional, racial/ethnic, and demographic groups say that the state’s higher education system is very important. In fact, strong majorities of Californians have been saying that higher education is very important to the state’s future since we first asked this question in 2007.

In the context of the 2018 governor’s race, 63% of California adults say that candidate positions on higher education are very important, and another 28% say they are somewhat important to them. Majorities across political, regional, racial/ethnic, and demographic groups hold this view.

When asked about the current workforce, 83% of Californians say that a four-year degree from a college and university prepares someone very well (30%) and somewhat well (53%) for a well-paying job in today’s economy. Fifty percent of Californians think that a college education is necessary for a person to be successful in today’s work world, with majorities of Latinos (67%), Asian Americans (54%), and African Americans (51%) and fewer whites (35%) holding this view. Moreover, about half of Californians, with pluralities across the state’s major regions, say that California will not have the college-educated residents needed for the jobs and skills likely to be in demand 20 years from now.

In sum, the importance of a higher education and the need for college graduates are issues on the minds of many residents today. Hans will provide the demographic and workforce analysis that demonstrates why the state’s higher education system is essential for a better future for all Californians.

PPIC has produced a series of reports on California’s future population and economy. Our report Will California Run Out of College Graduates? provides projections of the demand for and supply of workers across all levels of educational attainment to 2030. Our primary finding is that California faces a shortage of highly educated workers. Specifically, economic projections to 2030 show that about two in five jobs will require at least a bachelor’s degree, while demographic projections suggest only about one in three Californians will have at least a bachelor’s degree. This shortfall equates to 1.1 million workers.

In this presentation, I first describe how California’s population and economy are changing and then identify how the state and its higher education institutions can increase college enrollment and completion to produce more college graduates.

California’s economy increasingly demands highly educated workers

To develop our economic projections, we apply trends in educational attainment levels to occupational projections developed by the California Employment Development Department. We examine changes in labor market demand that are occurring due to shifts both in occupational structure and changes in educational attainment within occupations. Our primary finding is that the state’s economy will continue along a well-established trajectory, with a growing share of jobs requiring at least a bachelor’s degree.

There are two key drivers of increasing demand for college graduates: (1) faster growth in occupations that commonly require a college degree (e.g., computer technology), and (2) increases in demand for highly educated workers within occupations (e.g., nursing). In recent years, most (74%) of the increased demand for highly educated workers has occurred because of faster job growth in occupations that commonly require a college degree. Among occupations with at least 100,000 full-time year-round workers, there have been especially rapid growth rates for software developers (56% increase between 2010 and 2015), computer scientists and systems analysts (42% increase), and managers (35% increase). These and other highly skilled occupations have experienced faster growth than most occupations that require lower levels of education.

That said, the increase in educational attainment within occupations has been significant. For example, the share of registered nurses with a bachelor’s degree has grown from 57% in 2000 to 68% in 2015. From 2010 to 2015, about 26% of the increase in jobs for college graduates was attributable to growing demand for highly educated workers within specific occupations.

Are college degrees really necessary for these jobs? To answer this question, we examined a number of labor market outcomes. Within and across occupations, we find that workers with bachelor’s degrees have higher labor force participation rates, lower unemployment rates, and higher wages than those without—and that, in general, as educational attainment increases, wages also increase. Overall, the wage premium for college graduates relative to less-educated workers has grown. By 2015, the average annual wage for full-time year-round workers was more than twice as high for workers with a bachelor’s degree than for those with only a high school diploma.

Within each of 51 occupational groupings we see higher wages for college graduates than for high school graduates. Among registered nurses, for example, those with a bachelor’s degree earned 12% more than those with an associate degree.

California’s educational institutions are not keeping up with demand

Too few Californians are graduating from college. At current college enrollment and completion rates, only 30.5% of 9th graders in California will eventually earn a bachelor’s degree either in California or elsewhere in the United States. Among all states, California ranks 47th in the share of high school graduates who enroll in four-year colleges and 5th in the share who go to community colleges. Low rates of transfer from community colleges to four-year colleges exacerbate the problem.

A critical challenge is the retirement of the baby boom generation. Called the “silver tsunami” by some, this is the first time in California’s history that such a large and well-educated group is exiting the labor force. In contrast, the number of young adults in California is projected to increase only modestly.

Not all degrees are equal

On average, college graduates have very strong labor market outcomes. At any point in time, some college graduates are working in jobs that do not necessarily require a college degree, but over the course of their careers the vast majority of college graduates will move into occupations that reward their educational training. Our estimates show that students who earn bachelor’s degrees in engineering and computer science fare very well in the labor market, but even those with less remunerative majors, such as education and the liberal arts, will earn far more in wages than less-educated workers, even after taking into account all the costs of going to college.

How to close the degree gap

To close the degree gap, California and its higher education institutions need to establish new policies and practices to enroll more students, especially in our four-year colleges and universities, and improve graduation rates among students already in college. In previous testimony, PPIC has identified targets for each of the state’s public systems with respect to admission, transfer (from community colleges to four-year colleges), and improved graduation rates.

The University of California (UC) will play a central role. In our scenario, UC would need to award approximately one-quarter of the additional degrees necessary to close the gap. This is an ambitious target, but the increase over current levels (and over the baseline projection) would not be without precedent. For example, between the 1999–2000 and 2016–17 academic years, the number of bachelor’s degrees awarded by UC increased 62% (from slightly more than 33,000 to almost 54,000). Our closing-the-gap scenario would require UC to award about 81,000 degrees by 2029–30, a 51% increase over current levels.

Improving access and success among groups historically underrepresented in higher education—including low-income students, first-generation college students, Latinos, and African Americans—is essential if we are to close the degree gap. Compared to other public research universities, UC has an impressive record in enrolling low-income and first-generation students.

The California State University (CSU) system and the California Community College system have adopted new goals that are entirely consistent with PPIC’s targets. New initiatives, including remediation reform at the community colleges and at CSU, have the potential to substantially improve student success rates. CSU’s new graduation initiative aims to increase graduation rates and eliminate gaps between groups of students. College preparation among the state’s high school graduates has also increased, with the share of students completing the college preparatory requirements of UC and CSU reaching an all-time high. Strong demand for UC is likely to continue as college preparation continues to improve and the transfer pathway is better articulated. UC has seen consistent increases in graduation rates for many years, and new efforts to improve on-time graduation are likely to continue this trend.

Finding ways to accommodate all these students remains a central challenge, but one we must meet in order to ensure a better future for all Californians.

Video: Gavin Newsom’s Priorities

Gavin Newsom, California’s lieutenant governor and a candidate for governor in 2018, was asked in a San Francisco forum last week to name the three issues that will make the biggest difference in California’s future. Newsom, who is also a former mayor of San Francisco, predicted that both California and the nation will be grappling with these issues over the next ten years:

Debt and demographics. With California’s population aging rapidly, the state and its cities face growing public employee pension and health care liabilities. “As a progressive Democrat, I’m not naïve about the commitments we’ve made and the commitments we must fulfill,” Newsom said. “Nor am I naïve, as a former mayor, about the challenge of meeting those commitments . . . Cities like Richmond are facing the prospect that by 2021, by one estimate, upwards of 40% of their general fund will go to retiree contributions.”
Energy and climate change. The state has set ambitious goals to reduce greenhouse gas emissions and increase energy efficiency. “The next governor has to deliver,” he said.
Information technology and globalization. “The issue that animates my anxiety: work, the future of work.” The days of having a job or career have given way to something radically different, forcing us to think in terms of portable benefits and retirement security, he said. Further, workers in retail, food and beverage, and clerical jobs—the top employment categories—are on the “edge of automation.” Displacement of these workers will require us to have a different conversation about skills, education, and social mobility, Newsom said.

The conversation with Newsom was part of the PPIC Speaker Series on California’s Future. PPIC is inviting all major candidates for governor to participate in a public event if they reach a certain threshold in the polls. The goal is to give Californians a better understanding of how the candidates intend to address the challenges facing our state.

Watch all candidate videos.

Video: Californians Concerned about Cost but Give State’s Colleges Good Grades

Many Californians say the state’s public higher education system is going in the wrong direction, a new PPIC Statewide Survey shows. But they are more likely to say they are concerned about affordability than about the quality of the state’s colleges and universities. Just 18% of all adults say quality is a big problem, compared to 56% who call affordability a big problem.

Researcher Lunna Lopes presented the findings of PPIC’s annual survey on higher education to a Sacramento audience last week.

Among the survey findings underscoring Californians’ concerns about college affordability: 75% say the cost of college keeps students who are qualified and motivated from attending, 79% say students have to borrow too much money to pay for college, and 85% say colleges and universities should do more to make sure that all students have affordable housing options.

In contrast to Californians’ views on costs, solid majorities of residents give excellent or good ratings to the state’s community colleges, California State University, and the University of California.

Californians are divided on whether a college education is necessary to succeed in today’s work world, with half saying it is and 48% saying there are many ways to succeed without college. There are strong differences among demographic groups on this question. Two-thirds of Latinos say college is necessary, compared to just 35 percent of whites. And 59% of Californians with household incomes of $40,000 or less say college is necessary, compared to 42% of those whose incomes are $80,000 or more.

Despite this divide over whether college is necessary for success, 80% of Californians say the public higher education system is very important to the future quality of life and economic vitality of the state.

Learn more
Read the PPIC Statewide Survey: Californians and Higher Education
Find out more about the PPIC Statewide Survey

Visit the PPIC Higher Education Center

Testimony: The Need for College Graduates in California’s Future Economy

Hans Johnson, director and senior fellow at the PPIC Higher Education Center, testified today, November 1, 2017, before the Assembly Select Committee on the Master Plan for Higher Education in California. The master plan defined a strategy to meet the state’s education needs in 1960—but today, California faces new challenges. The topic of today’s hearing: ensuring that the master plan meets workforce needs.

Here are his prepared remarks.

PPIC has produced a series of reports on California’s future population and economy. Our report Will California Run Out of College Graduates?, provides projections of the demand for and supply of workers by educational attainment to 2030. Our primary finding is that California faces a shortage of highly educated workers. Specifically, economic projections to 2030 show that about two in five jobs will require at least a bachelor’s degree, while demographic projections suggest only about one in three Californians will have at least a bachelor’s degree. This shortfall equates to 1.1 million workers.

In this testimony, I first describe how California’s population and economy are changing, and then identify how the state and its higher education institutions can increase college enrollment and completion to produce more college graduates.

California’s economy is increasingly demanding highly educated workers

To develop our economic projections, we apply trends in educational attainment levels within occupations to occupational projections developed by the California Employment Development Department. We examine changes in labor market demand that are occurring due to shifts in the distribution of occupations and changes in educational attainment within occupations. Our primary finding is that the state’s economy will continue along a well-established trajectory, with a growing share of jobs requiring at least a bachelor’s degree.

The two key drivers of increasing demand for college graduates are: 1) faster growth in occupations that commonly require a college degree (e.g., computer technology occupations), and 2) increases in demand for highly educated workers within occupations (e.g., nursing). While both drivers are important, in recent years most of the increased demand (74%) for highly educated workers has occurred because of faster job growth in occupations that commonly require a college degree. Among large occupations (with at least 100,000 full-time year-round workers), those with especially rapid growth rates over the past five years include software developers (56% increase between 2010 and 2015), computer scientists and systems analysts (42% increase), and managers (35% increase). These and other highly skilled occupations have experienced faster growth than most less skilled occupations.

The second key driver of demand has been an increase in educational attainment within occupations. For example, the share of registered nurses with a bachelor’s degree has grown from 57% in 2000 to 68% in 2015. Altogether, over a five year period (from 2010 to 2015) about 26% of the increase in jobs for college graduates has occurred as demand for highly educated workers has grown within specific occupations.

Are college degrees really necessary for these jobs? We examine a number of labor market outcomes to answer this question. Within and across occupations, we find higher labor force participation rates, lower unemployment rates, and higher wages for workers with a bachelor’s degree than for those without. And in general, as educational attainment increases, wages also increase. Overall, the wage premium for college graduates relative to less educated workers has grown. By 2015, the average annual wage for full-time year-round workers was more than twice as high for workers with a bachelor’s degree than for those with a high school diploma.

California’s educational institutions are not keeping up with demand

Too few Californians are graduating from college. At current college enrollment and completion rates, only 30.5% of 9th graders in California will eventually earn a bachelor’s degree either in California or elsewhere in the United States. Compared to other states, California ranks 47th in the share of high school graduates that enroll in four-year colleges and 5th in the share that go to community colleges. Low rates of transfer from community colleges to four-year colleges exacerbates the problem.

A critical challenge is the retirement of the large and relatively well-educated baby boom. Called the “silver tsunami” by some, this aging out of the labor force of millions of older adults is the first time in the history of California that such a large and well-educated group is exiting the labor force. In contrast, the number of young adults in California is projected to increase only modestly.

Not all degrees are equal

On average, college graduates have very strong labor market outcomes. While at any point in time, some college graduates are working in jobs that do not necessarily require a college degree, over the course of their careers the vast majority of college graduates will move into occupations that reward their educational training. Our estimates show that students who earn bachelor’s degree in engineering and computer science fare very well in the labor market, but even those in less remunerative majors such as education and the liberal arts will still earn far more in wages than less educated workers, even after taking into account all the costs of going to college.

How to close the degree gap

To close the gap, California and its higher education institutions will need to establish new policies and practices to enroll more students, especially in our four-year colleges and universities, and ensure greater success of students already in college. In previous testimony, PPIC has identified targets for each of the state’s public systems with respect to admission, transfer (from community colleges to four-year colleges), and improved graduation rates. Improving access and success among groups historically underrepresented in higher education, including low-income students, first-generation college students, Latinos, and African Americans is essential if we are to close the degree gap.

The good news is that new goals adopted by the California State University (CSU) system and the California Community College system are entirely consistent with PPIC’s identified targets. New initiatives, including remediation reform at the community colleges and at CSU, have the potential to substantially increase student success. CSU’s new graduation initiative aims to substantially increase graduation rates and eliminate gaps between groups of students. Strong increases in college preparation among the state’s high school graduates are also a positive sign, with the share of students completing the college preparatory requirements of UC and CSU reaching an all-time high.

Finding ways to accommodate all these students remains a central challenge, but one we must meet in order to ensure a better future for all Californians.

Learn moreVisit the PPIC Higher Education Center

Video: Reforming Remedial Math in Community College

Developmental—or remedial—education is one of the largest barriers to student success in California’s community colleges. The good news is that reforms are underway, and a new report by the Public Policy Institute of California (PPIC) looks at the effectiveness of some of these reforms in math. PPIC researcher Olga Rodriguez presented the report in Sacramento this week. One reform the researchers studied is an alternative to traditional algebra-based courses and is designed for students in majors—particularly those in the liberal arts and humanities—that require only statistics. The report finds that students in this statistics sequence substantially outperform their peers who take traditional developmental math.

In a discussion following the presentation, panelists addressed the issue of why this math alternative is not more widely available. Myra Snell, math professor at Los Medanos College and cofounder of the California Acceleration Project, said the reasons range from the logistical to the cultural. Most math professors are not trained in statistics. Further, there is a deeply held belief among faculty that intermediate algebra is essential. She said that this “gets in the way of them rethinking what might be best for students.”

Laura Metune, vice chancellor of external relations at the California Community Colleges Chancellor’s Office, noted the necessary shift in emphasis from encouraging campuses to try multiple interventions to investing in alternatives with the best chance of helping more students achieve their academic goals.

Nikki Edgecombe, senior research scientist at the Community College Research Center at Teachers College, Columbia University, noted: “If we know that students who are completing a statistics-level pathway are completing their transfer-level math at a significantly higher rate, but we hold on to the old system as well, it’s safe to say we’re doing a lot of students a disservice.”

She continued: “To be honest, there are a lot of bad ideas out there. We need to have the moral courage to identify what those are and fashion solutions for students.”

Learn more

Read the report Reforming Math Pathways at California Community Colleges
Visit the PPIC Higher Education Center

Housing Costs and Higher Education

Owning a home has long been part of the American dream. But with the state’s high housing costs, homeownership is difficult for many Californians to achieve. In a recent PPIC Statewide Survey, more than half of renters say the cost of housing is making them seriously consider moving away from the part of California they live in now, with most of those indicating that they are thinking of leaving the state.

Homeownership rates are substantially lower in California than in the rest of the United States (54% vs. 63% in 2016, according to the American Community Survey). But one group in California fares relatively well with respect to homeownership: college graduates. Among heads of household with at least a bachelor’s degree, almost two-thirds own rather than rent, compared to less than half of high school graduates. The higher rates of homeownership among college graduates are a consequence of their economic success. As shown in other PPIC research, college graduates have much higher incomes and lower unemployment rates than other Californians, enabling many of them to purchase a home. Owning a home, in turn, often leads to greater wealth. Indeed, the higher net worth of college graduates in California is strongly tied to homeownership.

Of course, housing markets are regional, and the coastal areas of California are less affordable for everyone. The five counties with the lowest homeownership rates are all in coastal areas with high housing prices. But even in those counties—with the notable exception of San Francisco—over half of college graduates own a home. At the other extreme, counties with the highest homeownership rates are primarily suburban counties, including some with high housing costs. About 70% or more of college graduates in these areas own a home.

California policymakers have recently enacted a series of measures designed to increase the supply of housing, with a focus on affordable housing units. Certainly, the state’s housing crisis cannot be alleviated without building more housing. But while higher education is not often considered part of a housing agenda, it has played an important role in shielding many Californians from the state’s dramatic increases in housing costs. Because of the labor market advantages experienced by college graduates, many have been able to purchase a home, giving them more stability in their housing costs and allowing many of them to build wealth.

Learn more
Read Higher Education in California: Addressing California’s Skills Gap
Visit the PPIC Higher Education Center

Testimony: Cybersecurity Needs and Higher Education

Hans Johnson, director of the PPIC Higher Education Center and PPIC senior fellow, testified at the Joint Legislative Oversight Hearing on Cybersecurity Education and the Needs of the Workforce before the Assembly Committee on Higher Education in Sacramento today (October 10, 2017). Assemblymember Jose Medina chairs the Higher Education Committee and Assemblymember Jacqui Irwin chairs the Select Committee on Cybersecurity. Here are Johnson’s prepared remarks.

Thank you Chair Medina, Chair Irwin, and committee members. My name is Hans Johnson, and I am the director of the Higher Education Center at the Public Policy Institute of California. My role today is to provide a brief overview of cybersecurity labor market needs in the state. First, I’ll define cybersecurity occupations, next I’ll provide data on labor market trends, and finally I will discuss educational awards related to cybersecurity. Sources of information and data used in this testimony include the United States Department of Labor, the California Employment Development Department, the United States Census Bureau, and reporting by California colleges and universities to the United States Department of Education.

As an occupation, cybersecurity is identified by the US Department of Labor as “information security analyst” and resides within a broader set of computer and mathematical occupations. In this testimony, I will focus on the information security (IS) analyst occupation. However, it is important to note that other computer and information technology occupations include individuals who work at least partly on security issues. According to the US Department of Labor: “Information security analysts plan and carry out security measures to protect an organization’s computer networks and systems. Their responsibilities are continually expanding as the number of cyber attacks increases.”

The IS analyst occupation is a high wage, high demand occupation. It is growing but still relatively small. Increasingly, employers are hiring workers with at least a bachelor’s degree to fill IS analyst jobs, but a notable share of jobs are still filled by workers with less than a four-year degree. California colleges and universities have substantially increased the capacity of their institutions to award degrees in computer science and related fields. Even so, unemployment rates remain very low—an indication that employers could be having a hard time finding workers.

In California, EDD estimates the state was home to about 8,000 IS analysts in 2014, with that number projected to increase to 10,100 by 2024, a growth rate (26%) slower than other computer occupations (29%) but much faster than the state’s overall employment growth rate (15%). Still, it is important to note that IS analysts make up less than 1% of employment in computer occupations in California and less than 2% in the nation (see chart below). IS analysts work in a broad range of industries, including technology, banks, higher education, insurance, and health.

EDD estimates that IS analysts in California had a median wage of $53 per hour in the first quarter of 2017, which amounts to $110,000 on a full-time annual basis. Nationwide, the unemployment rate for IS analysts has been around 2% for several years now (based on my analysis of American Community Survey data from 2012 through 2015), with similarly low unemployment rates in California. Unemployment rates that low are a sign of high labor market demand.

Of critical concern for workers, and for these committees, are the education and training requirements for IS analysts. According to the U.S. Department of Labor:

Information security analysts usually need at least a bachelor’s degree in computer science, programming, or a related field. As information security continues to develop as a career field, many schools are responding with information security programs for prospective job seekers. These programs may become a common path for entry into the occupation. Currently, a well-rounded computer education is preferred.

The number of IS analysts has increased nationwide in the last five years and so has their educational attainment. In the US, 67% of IS analysts had at least a bachelor’s degree in 2015 compared to 56% in 2010. In California, about two-thirds of analysts have at least a bachelor’s degree. The share of IS analysts in the US with an associate’s degree has declined from about 15% to less than 10%. The vast majority with a bachelor’s degree majored in one of three fields: computer science (including information systems), engineering (including electrical engineering and computer engineering), and business (including management information systems). In California, annual average earnings for IS analysts with a bachelor’s degree are about 70% higher than for those with some college or an associate’s degree, who in turn earn about 20% more than those with only a high school diploma. Unemployment rates are low for IS analysts, especially those who have some postsecondary education and those who have a bachelor’s or graduate degree.

California is home to dozens of colleges and universities that offer degrees in computer and information sciences. The state’s universities, especially the University of California, have quickly responded to the strong demand for these degrees (see chart below). The total number of bachelor’s degrees awarded increased from less than 3,000 in 2010 to 6,000 by 2016, with UC and CSU accounting for 65% of the total in 2016. The most common major is computer science, followed by computer and information science.

California’s community colleges also offer postsecondary training in computer and information sciences, ranging from short-term certificate programs to associate’s degrees. Importantly, they also provide lower division courses necessary for transfer to a four-year college or university. The total number of associate’s degrees in computer and information sciences and support services doubled between 2010 and 2016, from 719 to 1,490. The number of short-term certificates (completed in less than one academic year) increased from 1,605 in 2010 to 1,838 in 2016, and the number of longer-term certificates (completed in at least one but less than two academic years) increased from 225 to 321. In all, the number of postsecondary awards totaled more than 3,600 by 2016. PPIC is currently developing research that explores information technology awards at the community colleges and is working with the Employment Development Department and the Chancellor’s Office of the California Community Colleges to secure access to student and wage data.

In thinking through the roles of the different segments of higher education in California, it is important to keep in mind that the segments are designed to work as a system. The strong demand, both on the part of students and employers, in technology fields should be met by each institution and by the segments working together. For example, improving transfer from community colleges to UC and CSU in technology fields through better articulation—including Associate Degrees for Transfer—is necessary if students are going to fully realize the economic benefits of these fields. Moreover, cybersecurity occupations are but one part of a larger technology sector. Developing a larger industry-wide and cross-system approach to meeting demand is necessary. Innovations—such as locating some CSU bachelor’s degree programs at community college campuses—offer the promise of reaching more students, including those underrepresented at our four-year colleges. California can best serve the growing number of students who want to pursue technology jobs by taking advantage of the strengths of each segment of its public higher education system—and helping those segments work together to meet the economic need for these highly skilled workers.

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