Higher Education and the Workforce

What’s the need? What’s our response?

2002 Annual Meeting

Roderick G. W. ChuOhio Board of Regents

The Challenge

“If we are to remain preeminent in transforming knowledge into economic value, America’s systemof higher education must remain the world’s leader in generatingscientific and technologicalbreakthroughs and in meeting thechallenge to educate workers.”

Alan GreenspanChairman, Federal Reserve

SystemFebruary 15, 1999

Key Assets

“The capital assets that are needed to create wealth today are not land, not physical labor, not machine tools and factories: They are instead knowledge assets.”

Thomas A. Stewart “Intellectual Capital: the New Wealth of Organizations”

It’s the market talking!

Source: Postsecondary Education OPPORTUNITY

7.3

4.2

3.5

2.9

2.5

2.1

1.1

1.2

012345678

UNEMPLOYMENT RATE IN 2001

$21,391

$28,807

$32,400

$35,389

$46,276

$55,302

$70,476

$80,230

$0 $20,000 $40,000 $60,000 $80,000 $100,000

MEDIAN EARNINGS IN 2000

PROFESSIONALDEGREE

DOCTORATE

MASTER’SDEGREE

BACHELOR’SDEGREE

ASSOCIATEDEGREE

SOME COLLEGENO DEGREE

HIGH SCHOOLGRADUATE

LESS THANHIGH SCHOOL

Higher Learning = Higher Earning

The income gap is growing

Source: Postsecondary Education OPPORTUNITY

Economic conclusion: Demand for skilled workers > Supply … and it’s getting worse

“… the most likely economic scenario suggests there will not be enough adults with at least some college to keep up with the growth in demand. …

… roughly 15 million new jobs that require college-educated workers will be created, resulting in a net deficit in workers with at least some college of about 12 million workers by 2020.”

Anthony P. Carnevale & Richard A. Fry “The Economic and Demographic Roots of Education and Training”November 19, 2001

Yet states continue to disinvest in higher education

Higher Education Appropriations as % of State Tax Revenues

5.0%

5.5%

6.0%

6.5%

7.0%

7.5%

8.0%

8.5%

1973

1978

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

Source: Research Associates, Washington, DC [Halsted]

Why the disinvestment?

Competing demands Medicaid, K-12, Prisons

Popular support declining Quest for immediate gratification Public perceptions

Still reaching only the elite Directly benefit only for a short time

The Key Planning Question: How many of our citizens need additional education?

Job growth statements

“68.5 percent of the fastest growing jobs require some level of college certification.”

 Attributed to reports from theBureau of Labor Statistics

Job growth statements

“Economists predict that by 2008, the number of jobs requiring an associate's degree will grow by 31%. By the year 2008, the number of jobs requiring a bachelor's degree will grow by 24%.”

 Center on Education Policy and American Youth Policy Forum: “Higher Learning =Higher Earnings. What you need to know about college and careers”September 2001

Job growth statements

“The 20 occupations with the highest earnings all require at least a bachelor’s degree. Throughout the economy, occupations that require a college degree are growing twice as fast as others.”

 

U.S. Dept. of Labor Futurework – Trends and

Challenges for Work in the 21st Century

… but how many will be required?

Caution: Bad estimates

“Retrospective analysis of the BLS projections by the Bureau itself and others shows that the BLS has underestimated the demand for workers from two-year and four-year institutions substantially and consistently.”

Anthony P. Carnevale & Richard A. Fry

“The Economic and Demographic Roots of Education and Training”

November 19, 2001

Some hearsay figures

Source: American Vocational Assn Guide to School-to-Work Opportunities, 1994

The Changing Needs of the American Workforce

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1950 1991 2000

Professional

Skilled

Unskilled

Some hearsay figures

Where the Jobs Are

20% require a 4-year college degree

65% require an associate degree or advanced training

15% require minimum skillsAttributed to Richard W. Judyauthor of Workforce 2020Hudson Institute

In any case, it’s clear:

Other providers

Business & industry Human services organizations For-profit institutions K-12 vocational/adult ed

If colleges and universities don’t do it,others will and our institutions will be relegated to providing elite education

Have we already lost the game?

U.S. adults (aged 25+) 194.6 M Adults engaged in any

formal learning activity 89.3 M Adults enrolled in

public or privatedegree-granting institutions 5.9 M

Source: NCES Digest of Education Statistics, 2001

Questions More need education.

But how many? What percent? What are the needs we’re not

addressing today? Different learner populations

Different learning abilities & styles Different/additional

knowledge/skills How can we educate the masses? What is higher education’s role

and responsibility?

Possible SHEEO initiatives

Share specific expert citations on workforce education needs

Share workforce development strategies and initiatives

Develop a rationale for various parties addressing workforce needs

Strategic imperative: Massify the reach of higher education

Majority of the population will need

post-secondary education Winning providers will need to

meet the specific needs of the market Can’t be a “Field of Dreams” strategy The potential: Become the 2nd government

function that directly and continuously serves the needs of most taxpayers