PPIC Higher Education Center – Page 4 – Public Policy Institute of California

Training California’s Students for Well-Paying Jobs

California’s community college system is the largest provider of career education—also known as career technical education or vocational education—in the state. Career education programs play a critical role in training students, especially underserved and nontraditional students, for jobs that provide solid wages but don’t require a four-year college degree.

How can colleges identify these jobs? In a recent PPIC report, we compare occupational earnings to regional poverty thresholds to assess how future workforce needs connect to well-paying jobs that don’t require a four-year degree. Other work by the Brookings Institute focuses on “opportunity industries,” in which good jobs—those that provide stable employment, middle-class wages, and benefits—represent an above-average share of the industry’s total jobs and are filled by workers with only some college training.

Opportunity industries are largely concentrated in fields that align with many of the community colleges’ career education disciplines, including business, engineering, health, information technology (IT), and public and protective services. A critical question is whether students are successfully completing programs that will prepare them for careers in these fields.

The good news is that over the past 20 years, there has been a consistent upward trend in the completion of career education credentials in California’s community colleges, with major gains observed in the last decade. This increase spans industries. Notably, more degrees and certificates are being earned in health than in any other discipline—this is important since health credentials are especially valuable in increasing students’ subsequent earnings.

But not all credentials are associated with large economic gains. For example, in our analysis of wage returns, we find that career education credentials in business and IT do not provide much of a wage boost.

Furthermore, there seems to be a mismatch between the awards with the most value and the awards students are earning. While awards from longer programs generally tend to confer more value than those from shorter ones, completion of short-term awards has increased in several career education disciplines.

Community colleges and industry partners need to work together to ensure students have a path to well-paying jobs and the tools needed to succeed. As shown in our research, some of that work begins with colleges structuring effective pathways to these industries and clearly communicating the economic returns and opportunities available to students.

Moreover, strong partnerships between community colleges and nearby industries will be essential in creating a bridge between students and their industry of choice. Ultimately, these efforts can help improve the economic well-being of individual students and the state as a whole.

California’s Brain Gain Continues

[vc_row][vc_column][vc_column_text]California’s heyday of rapid population growth—the post-World War II era—was fueled by millions of migrants coming to the state from the rest of the country. Those days are long gone. California’s population continues to grow (through births and international migration), but every year it loses tens of thousands of people to other states. And yet there is one group that California continues to attract: college graduates.

This interstate migration pattern—gaining large numbers of college graduates while losing large numbers of less educated adults—doesn’t happen anywhere else in the country. Over the past five years, California has attracted 162,000 more college graduates (adults with at least a bachelor’s degree) from other states than it has lost. Over the same period, the University of California (UC) awarded about 300,000 bachelor’s degrees at its nine undergraduate campuses. In other words, interstate migration provides California with half as many college graduates as the entire UC system.

College graduates come to California from all over, but eight states send California substantially more college graduates than they get in return. Between 2012 and 2017, net gains of college graduates from New York (51,000), Illinois (31,000), Pennsylvania (24,000), New Jersey (20,000), Massachusetts (20,000), Florida (16,000), Michigan (13,000), and Ohio (11,000) totaled more than 186,000. California experienced smaller but still sizable net losses (totaling 80,000) to five states: Texas (29,000), Oregon (16,000), Nevada (13,000), Arizona (12,000), and Washington (10,000).

The new migrants to California tend to be quite young. Indeed, college graduates age 20–29 account for almost all of the net gains. (In contrast, California experiences small net losses of older college graduates.) From a labor market perspective, attracting young college graduates is especially advantageous. Young adults with college degrees are at the start of their careers and provide the state with much-needed highly educated workers.

In fact, college graduates moving to California are more likely to be employed than those leaving the state. The largest gains are primarily in majors that are in relatively high demand in the labor market, including engineering (33,000), communications (18,000), business (18,000), and computer science (17,000).

The migration of young college graduates to California is a consequence of the state’s growing demand for highly skilled and highly educated workers. But the numbers are not high enough to fully meet the state’s changing needs. Although many college graduates move to California from other states, the most important source of highly educated workers in California are the state’s own colleges and universities. Policies and practices to improve college access and completion in the state will ensure that more Californians are able to help create and benefit from a strong economy.[/vc_column_text][/vc_column][/vc_row]

Video: Career Pathways and Economic Mobility at California’s Community Colleges

About a third of future jobs in California will require more than a high school diploma but less than a bachelor’s degree. By training workers for these jobs, career education—also known as career technical education or vocational training—plays an integral role in meeting California’s workforce needs and improving students’ economic well-being.

At an event in Sacramento last week, PPIC researcher Shannon McConville outlined the findings of a new report on career education and economic mobility, and a panel of experts discussed the implications for students, colleges, and the state as a whole.

McConville noted that completing a career education credential at a California community college confers a 20% wage gain, on average. But economic benefits vary greatly across program areas. For instance, returns to health credentials tend to be substantial, while business and IT credentials yield lower returns.

The panelists began by highlighting current efforts to improve students’ labor market outcomes. Marty Alvarado, executive vice chancellor for educational services at California’s community colleges, explained the system’s “two-pronged approach” to making sure programs connect to in-demand, high-return careers. One area of focus is regional infrastructure, which includes regional labor market centers that provide colleges with data on local industries. The second area includes tools to help students better navigate their program choices, “while also trying to make transparent the earnings projections for students as they move into these career options.”

Supporting students—especially low-income students from underrepresented demographic groups—in completing high-return credentials was another topic of conversation. Alvarado discussed efforts at the community colleges to streamline processes that may be creating “unnecessary barriers for students,” while Assemblymember Autumn Burke emphasized the importance of access to social safety net services so students can focus on their career.

Alma Salazar, senior vice president of the Center for Education Excellence and Talent Development at the Los Angeles Area Chamber of Commerce, noted that all stakeholders need to be involved. “How do we get the system as a whole to take ownership in helping us collectively solve for these problems? . . . It has to go beyond Sacramento. It has to go beyond the system’s leadership. It has to get to the institutional level and the people who work [there], who have to be equally committed.”

While many see the evolving nature of work and increasing automation as challenges, Assemblymember Burke was optimistic about providing a “just transition” for workers who may lose jobs in fast-changing industries. “We can train people for this new economy [and] prepare them now. . . . It’s a shortcoming to worry about losing minimum-wage jobs, because there’s so much opportunity on the other side.”

Interview: Filling the Gaps in California’s Education Data

California is one of only a few states without a database showing how students advance from K–12 schools to college and into the workforce. As part of his “cradle to career” initiative, Governor Newsom has proposed $10 million to develop such a system.

We talked to Dr. Jessica Cunningham, interim executive director of the Kentucky Center for Statistics (KYSTATS), about Kentucky’s preschool-to-workforce data system and what California can learn from their experiences.

PPIC: What are the benefits of an integrated student database?

Jessica Cunningham: One major benefit is improving current programs and education-to-career pathways. We work with K–12 career technical education (CTE) programs to provide them with better labor market data to guide their offerings. We’ve also evaluated the impact of expanding work-ready scholarships for students earning high-demand associate degrees at community colleges.

Our research helps policymakers, practitioners, agencies, and the public make more informed decisions. We recently showed that students who completed K–12 CTE programs earned more than their peers. This information contributed to the state’s decision to include CTE pathways as an alternative to the standard high school equivalency test.

PPIC: What hurdles did you encounter establishing the system?

JC: Funding is an ongoing challenge. We’re 85% funded by federal grants, so we face some financial uncertainty year to year. We’re currently looking at the potential for state appropriations as a more sustainable funding source.

More broadly, managing the data system is like working on a puzzle. Sometimes there are missing pieces, since you’re only able to report on the data you have. For example, we don’t have data on private K–12 schools or on children’s experiences prior to preschool or Head Start, so we need to be mindful of those gaps.

Also, some benefits of a data system take time and it’s important to set expectations accordingly. When we published our very first report on high school graduates, readers were eager for information on college completion rates and earnings. But we needed many more years of data before we could examine those long-term outcomes.

PPIC: What recommendations do you have for California?

JC: In Kentucky, we’re legislatively authorized to receive education and workforce data. A governance structure that includes different stakeholder groups (K–12, higher education, workforce development, financial aid) is also critical.

In the early stages, it’s necessary to figure out the key questions for the state—and to determine who should be engaged in that process. Those questions will drive decisions about the data you collect. You won’t be able to do everything at once, so developing a strong research agenda is essential.

Setting up a centralized system makes things easier. This way, no one has to recreate all the necessary data connections for every report or request. Our reporting data warehouse has zero personally identifiable information. We do everything in house—we don’t have to send data back and forth to a vendor and we know that we’re maintaining confidentiality and following the rigorous rules outlined in our data use and access policy.

We also emphasize that we’re nonpartisan. We provide data and results, but policymakers and other leaders are the ones driving the conversation about how to use this information to improve programs and policies.

Skills-based Immigration and California’s Workforce

[vc_row][vc_column][vc_column_text]The White House recently issued a summary of an immigration plan that would shift the nation’s largely family-based immigration system toward a skills-based approach that would probably prioritize immigrants with higher levels of formal education. Given that the education levels of new immigrants are already on the rise, what impact might a skills-based system have on in California, the state with the largest immigrant population?

The proposed new system would increase the percentage of skills-based legal immigrants from 12% to 57%, leaving the total number of immigrants at 1.1 million per year.

In recent years, about two-thirds of immigrants with lawful permanent residence status (or “Green Cards”) have been admitted to the US through family-based preferences. The proposed new system would reduce this by half, to 33%. The White House statement emphasizes that priority would still be given to immediate family members of both US citizens and lawful permanent residents.

Past PPIC research suggests that family-preference immigrants have historically been high- and low-skilled. And California’s economy relies on immigrants at both ends of the educational spectrum. Nearly a third of the state’s working-age immigrants lack a high school diploma, and they make up a large portion of the workforce in industries requiring less formal education. However, the foreign-born now constitute 31% of California workers who have at least a BA, and they are overrepresented in high-skill industries like technology and health care.

Recent PPIC research finds that new immigrants in California are increasingly well-educated. In 2017, a slight majority (52%) of the state’s working-age immigrants with fewer than five years in the US had a bachelor’s or graduate degree, compared to only 22% in 1990. Only 17% had not graduated from high school, down from 47% in 1990. Indeed, recently arrived immigrants are more likely than US-born Californians to have college or graduate degrees.

It is impossible to know exactly how a skills-based immigration system would affect California. But given the trend toward higher education levels among new immigrants and state economy’s reliance on both high- and low-skilled workers, a shift toward such a system might not be necessary to meet California’s workforce needs.[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][/vc_column][/vc_row]

CSU’s Prudent Saving Strategy

The California State University system is taking significant steps to improve its financial position and increase transparency with a new public, online Financial Transparency Portal. It shows that CSU is building both capital and operating reserves that could help soften the blow in the event of an economic downturn.

The new Transparency Portal shows that CSU’s reserves have grown in recent years, for both capital spending—which includes equipment acquisition, facilities maintenance and repairs, and capital improvement and construction—and operations. To put this growth into context, in CSU’s 2017–18 budget a little more than one third of total expenditures went toward salaries and wages (about $3.6 billion). The system’s operating reserve for that year was about $800 million, meaning that if that system spent its entire reserve it would still only be able to cover a very modest cut in state appropriations.

The portal also shows that some of the greatest growth has occurred in funds for capital improvement and construction. These funds are typically allocated to upgrade existing facilities and build new ones. This is very good news in terms of long-term planning, and provides a good example for the state’s other higher education institutions.

There also has been modest progress in accumulating savings to simply maintain facilities, an area that saw deep cuts during the Great Recession.

The growth in capital reserves is promising and helps to safeguard CSU’s ability to meet the needs of its future students. Similarly, building operating reserves is key to preserving access and maintaining strong student outcomes during the next recession.

Making financial information transparent, including campus-level information, is also a positive step. It clarifies the allocation of resources and reveals the details of CSU’s reserve strategy—making important information available to public officials and the attentive public.

LAUSD’s Measure EE and the Parcel Tax Vote Threshold

On June 4, voters in the Los Angeles Unified School District (LAUSD) will decide the fate of Measure EE, a historically large parcel tax that would generate about $500 million a year. Like all parcel taxes, Measure EE has a high bar to clear: two-thirds of voters must approve it. More than half of all proposed parcel taxes have cleared this bar since 2003.

The California Legislature is considering a constitutional amendment to lower the parcel tax vote threshold to 55%. If the legislature approves this proposal, California voters will weigh in. The amendment’s success at the ballot box is far from certain: the April 2019 PPIC Statewide Survey found that just 39% of likely voters would favor such a measure. But what might happen if the legislature and voters did ultimately approve the lower vote threshold? If the state’s recent experience with school bond measures is any indication, we would expect to see more parcel taxes placed on the ballot, with more of them passing.

The parcel tax is a California phenomenon. Proposition 13 (1978), which placed strict limits on commercial and residential property taxes, included a provision allowing cities, counties, and other districts to impose “special taxes” if two-thirds of voters approved. While the majority of parcel taxes levy a flat dollar amount per parcel—a lot or piece of property—Measure EE ties the dollar amount to the square footage of the building(s) on each parcel.

California voters lowered the approval threshold for school and community college bond measures to 55% when they approved Proposition 39 in 2000. The passage rate for K–12 bonds increased from 62% in the five-year period before Prop 39 to 79% in the five-year period after it was approved, and both the number of measures and rate of passage for K–12 bonds have been rising since 2011. This increase is especially striking given that the median bond amount has more than doubled (from $20 million to $45 million) since the threshold was lowered.

The trend has been similar for community college bond measures, though there are far fewer community college districts (73) than school districts (1,026) in the state. After Prop 39 passed, more colleges placed measures on the ballot—especially from 2001 to 2005—a higher share passed, and bond amounts increased. Passage rates increased from 42% before Prop 39 to 86% since 2011. The median amount has more than tripled since 1996 (increasing from $87 million to $350 million).

The vote on Measure EE will be important for LAUSD—the resources that the parcel tax would generate are critical to the district’s future finances. The vote will also be worth watching with the pending constitutional amendment in mind. If the measure is approved, lawmakers may see less need for lowering the parcel tax threshold. If it is defeated, the amendment may gain momentum.

Reforming California’s Community College System

California’s community colleges have a strong record of providing access to higher education—they enroll more students than any other college system in the country, including large shares from groups that have been historically underrepresented. But improving student outcomes has long been a challenge: fewer than half (48%) of students earn a degree or certificate or transfer to a four-year college. The community college system is implementing a broad range of reforms designed to address these high rates of incompletion. These reforms focus on improving the student experience from initial enrollment to graduation and beyond.

From our perspective, the most dramatic reforms are in developmental (or remedial) education. In the past, a large majority of students entering the community college system have been placed in developmental education courses in English and/or math, and relatively few have gone on to complete transfer level courses. But the passage of Assembly Bill (AB) 705 in 2017 has required colleges to implement assessment and placement procedures, including new curricula that result in more students completing transfer-level courses in English and math within one year of entering. Our work has shown substantial improvements at colleges that have been early implementers of these new procedures. For example, 70% of students who entered directly into transfer-level courses in English with co-requisite support (a form of concurrent remediation) successfully completed the course, compared to 29% of those who began in a prerequisite developmental education course. Full implementation of AB 705 will occur this fall.

Other reforms aim to improve student pathways throughout community college and beyond. For example, the Guided Pathways program is designed to help students navigate through community college by helping them choose programs of study, mapping pathways to their end goals, and ensuring that they stay on those pathways. Another new program, the Associate Degree for Transfer, guarantees admission to a California State University campus in a major aligned to a student’s community college course of study. All of these reforms make equity a primary consideration. The student-centered funding formula links these efforts by tying a portion of district funding to equity and success outcomes, including completion of transfer-level math and English within the first year, certificates or degrees granted, and transfers to four-year universities, among others.

Implementing new programs and policies is not easy, and it will take time to assess the results. But, as PPIC has shown, many of these reforms are showing early promise.

Expanding Enrollment at UC and CSU

California’s economy is increasingly demanding highly educated workers. To meet this demand, and to ensure that more Californians are successful in the 21st century economy, the state’s universities will need to admit and graduate greater numbers of students than they do today.

Governor Newsom’s budget proposal offers a step in the right direction, but it could go further.

The governor’s budget provides General Fund increases of 7% for the University of California (UC) and 8% for the California State University (CSU), including funding for enrollment increases of 1,000 and 7,000 students respectively. The budget also provides $95 million ($50 million for UC and $45 million for CSU) in ongoing funding to improve student success efforts at both systems. This is good news and represents substantial reinvestment in the state’s public universities.

But the enrollment increases fall short of what CSU and UC had been hoping for, and more importantly, short of student demand. In its 2019-2020 budget plan, UC had sought enrollment increases for 2,500 California resident undergraduates in order “to maintain access for projected increases in UC-eligible high school graduates and transfer-ready California Community College students.” CSU had sought an even more ambitious increase of more than 18,000 in order to accommodate more freshmen and transfer students.

As the state moves into the eleventh straight year of economic growth, ensuring investments in higher education is critical—especially in the face of an eventual downturn. Higher education is often one of the first budget areas to be cut during a recession. Today, even after a decade of reinvestment and one of the largest economic expansions in state history, funding per student at UC and CSU still remains below pre-Great Recession levels. And it is far below the funding peaks of the late 1990s and early 2000s.

As the legislature and governor negotiate over the budget, it may be time to consider creating a long-term funding plan for public higher education. An effective multi-year plan would account for increased enrollment, incentivize student success, prioritize equity, and provide a sensible tuition growth plan. This would allow students and their families, as well as universities, to better plan for the future—and would put the state on a path to meeting the economic demands of the future.

Coping with High Housing Costs in College

California’s housing crisis affects college students around the state. Over the past eight years—even as tuition has been stable at California’s public colleges and universities—the cost of attending college has risen because housing costs have gone up. Most students at California’s community colleges and in the California State University system pay more for housing than they do for tuition. At the University of California, housing costs are on par with tuition (for those who pay full tuition).

One way students limit their housing costs is by living with their parents or other family members. For most students, living at home is much cheaper than living in housing provided by the university or in an apartment off campus. Housing costs vary across systems, but in every case living with family is much less expensive than other housing options. And the savings are large—as much as $10,000 a year.

In fact, the large majority of California undergraduates do live at home (69% in 2017), and that share has been increasing over the past few decades, according to the American Community Survey. Moreover, California college students are substantially more likely to live at home than their counterparts in the rest of the nation.

Partly, this difference reflects the mix of colleges in California. Community college students are especially likely to live with parents—not surprising given the broad geographic coverage of this system. And CSU students are more likely to live at home than UC students. But the difference in living situations between California students and their peers nationwide almost certainly reflects California’s higher housing costs.

Living at home while attending college can be a great way to reduce costs. But it also has a downside. Research suggests that students who live at home are less connected to their college—and less likely to graduate.

California’s colleges and universities cannot solve the state’s housing crisis, but many of them are working to expand on-campus housing opportunities. They are also working with the state to develop ways to expand grants to cover housing costs as well as tuition. The governor’s proposed budget includes $40 million to provide emergency housing support for UC and CSU students (including those struggling with homelessness).

With no quick solution to the high cost of housing in California, thoughtful actions will be critical to providing support to college students across the state.