To Close Middle-Skills Gap, Improve Community College Outcomes

Over the past four years, there has been intense talk about the middle-skills gap in New England.
In Massachusetts—from the governor, often flanked by business leaders, to the commissioner of higher education, to President Obama speaking at a high school in Worcester this past spring—it appears that everyone is concerned with the middle-skills gap. And Massachusetts is not alone. For southern New England, the middle-skills gap is projected to become acute by 2020, according to the Federal Reserve Bank of Boston. Furthermore, projections from the Census Bureau, the Bureau of Labor Statistics and independent analyses suggest that, without intentional public policy, a mix of demographic, migration, industry and labor market factors could adversely impact the New England economy.

Despite the attention, however, many still do not understand the meaning of middle-skills jobs and the skills gap. Middle-skills jobs are jobs that require more than a high school diploma, but less than a bachelor’s degree. These are jobs that can be filled by people with a certificate or with an associate degree. The middle-skills gap refers to a situation created when significant numbers of jobs requiring less than a bachelor’s degree remain unfilled because employers cannot find people with the skills to fill them.

The problem

While the pool of high-skill workers—meaning those with a bachelor’s degree or higher—in Massachusetts has historically and continues to outpace the country, the reverse trend is found in the rate of growth of middle-skills workers. Historically and currently, the middle-skills labor pool in Massachusetts has been significantly below national rates and has been recently experiencing a decline. Since 2000, demand for middle-skills workers has outpaced supply and the gap is expected to grow significantly through 2020 for a range of industry sectors, including healthcare, computer and mathematical sciences, management, business and financial operations, according to a 2010 report of the Boston Fed. The report further projects that, by 2020, the population entering the labor force in New England will be 15% smaller than the share retiring.

With 36% of Massachusetts high school graduates attending community colleges and 90% of community college graduates remaining in the state (according to the state Department of Higher Education), investing in that population of college students and aligning some of their academic programs with workforce demands seem to be logical steps. The argument is often made that such a focus comes at the expense of the humanities. Empirical data from a national survey and regional gatherings convened by the American Association of Colleges and Universities show that employers want graduates who have a solid humanities foundation. While the intellectual development that takes place in college has innate value, ultimately students want to be employed upon graduation and colleges have the responsibility for equipping them with the skills that the market demands.

So why haven’t community colleges filled the middle-skills gap already? The answer is simple. Our community college graduation rate is abysmal. In Massachusetts, the average community college four-year graduation rate hovers in the teens. For minorities, including Hispanics—the fastest growing minority group in the country (and in Massachusetts)—the graduation rate is even lower. While some students transfer to a bachelor’s-granting institution prior to graduation, that does not account for the low average graduation rate for community colleges. Attrition does.

Improving outcomes

Closing the middle-skills gap depends on improving community college outcomes. Improving the outcomes of community college student outcomes is not just a taxpayer accountability issue; it is an economic imperative of the state.

Community colleges are public institutions enrolling low- and middle-income students who are diverse in their race, academic preparation, age and prior professional experience. Community colleges also enroll higher proportions of at-risk students. While some may make the argument that college is not for everyone, Massachusetts is a knowledge-driven economy requiring some postsecondary credential to make a family-sustaining wage in positions that offer a career ladder. According to recent calculations by the Boston Fed, the wage premium for a skilled worker versus one with a high school diploma in New England was estimated to be almost 75% in 2006. This means that someone with a postsecondary degree, on average, made about 75% more per hour than someone with just a high school diploma. Improved community college graduation rates would not only increase the supply of middle-skills labor, it would keep the state labor market strong and attractive to employers. Additionally, it would make the state economy robust while also potentially reducing the social burden of underpaid workers.

So how do we raise student outcomes?

Given the public policy, funding and credentialing focus of the Patrick administration, governmental and quasi-governmental agencies, and industry consortia, it is clear that those with influence understand the gravity of the middle-skills gap economic implication now and into the future. Furthermore, the focus on community colleges also points to a general understanding among key stakeholders that community colleges have a role to play in closing the gap. Examples of this include the Patrick administration’s recent announcement of competitive funds for early college high school programs, which would allow students to complete an associate degree or the first two years of college while still in high school. In addition, a separate funding announcement for capital investment in high-demand fields calls for collaboration between technical/vocational high schools and community colleges. The Massachusetts Life Sciences Center’s STEM Equipment and Supplies Grant Program that funds middle and high schools that seeks to expose and advance life sciences. Mass BioEd, a life sciences industry consortium, offers competitive credentialing of biotech programs for community colleges.

There is general agreement that community colleges have a role to play in closing the middle skills gap. What is less understood is how to most effectively do that. I would argue that the answer lies in raising community college outcomes.

Any scalable attempt to raise community college student graduation rates has to address the root cause of low graduation rates at community colleges. Community college students face significant obstacles to completing college. Simple issues like childcare, transportation, housing, and cost of books are among the top reasons for student withdrawals. While systematic data have not been collected across campuses to quantify the magnitude of these problems, most campuses collect data on student withdrawals and many provide emergency funds that aim to address these issues but not at the scale necessary to eradicate them. Nationally, a 2009 study by the Gates Foundation found balancing work, family commitments and school, lack of financial and other supports were major reasons for community college students to drop out.

Building on existing foundations

Two years ago, the Massachusetts Department of Higher Education launched the Completion Incentive Grant Fund which targeted low-income, first-time degree-seeking students at the state’s public higher education institutions and provided them with a cash incentive intended to help defray some of the costs of books if the students completed between 9 and 15 credits. The program is in its final year being run as a pilot, and evaluation data are being collected to measure its effectiveness. The program has made a difference for many students, but its design shows limited ability to prevent attrition. It rewards completers with funds to help buy books the following, not the current semester.

The commissioner of higher education and the University of Massachusetts System president speak often of the value of public higher education in a state where the median annual “net price” for tuition is nearly $30,000, bringing the median out-of-pocket cost of a bachelor’s degree for Massachusetts residents to $120,000. A statewide multilingual campaign promoting public higher education among both potential students and families and highlighting the community college as a pathway to middle-skills and high-skill at the four-year level could help close the gap and ensure that potential employees continue to sharpen their skills beyond the associate degree

Building on the focus and recent increased funding of closer linkages between K-12 and higher education in the state, and drawing on highly successful national models such as those in Texas and Florida, reinforcing public education and community colleges by exposing students to high-demand careers may also contribute to closing the gap.

Closing the middle skills gap in key industries that underpin the New England economy is both a short- and long-term necessity. Community colleges provide an existing structure for preparing the labor force to close the gap. The challenge ahead for business and industry, higher education and policymakers is how to raise community college student outcomes in ways that are scalable and sustainable and that address the root cause of the problem. We have some foundation to build upon. Coordinated efforts across agencies and sectors and educating the public will also prove critical for the success of new initiatives.

Yves Salomon-Fernandez is vice president for strategic planning, institutional effectiveness and grants development at MassBay Community College and executive officer of MassBay’s Framingham Campus.

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