Discusses challenges faced by states in aligning higher education with labor market demands, shares examples of state strategies, and makes recommendations for implementing state strategies.
“Improving the skills and earnings potential of poor youth and adults should remain a top priority for state and federal policymakers. Poorer people lag behind their more affluent peers in both postsecondary educational attainment and earnings, and raising both would contribute strongly to reducing poverty among current and future generations. Tapping the full potential of public colleges to provide a leg up to those who need the educational push could go a long way toward alleviating poverty” (p.1).

This issue brief features a discussion of topics of concern, including challenges faced by states in aligning higher education with labor market demands, and shared examples of state strategies; the author also makes recommendations for implementing his proposal. (Abstractor: Author and Website Staff)


Major Findings & Recommendations

“While postsecondary enrollments have risen across the entire income spectrum, it is also evident from data sources that dropout rates are very high among low-income students, especially at community colleges and non-elite four-year colleges” (p.2). Because “public institutions…are mostly paid (through state subsidies or private tuition payment) for student ‘seat time’ rather than education or employment outcomes, they have little incentive to respond to labor market need” (p.2). “While for-profits are sometimes described as institutions that serve disadvantaged students and rapidly respond to changing labor market demands (Deming, Goldin, and Katz 2013), these institutions have thus far been largely unsuccessful at appreciably improving postgraduation earnings for low-income students and filling gaps in training and education left by public-sector colleges” (p.2). “Educational institutions should be incentivized to better guide students into the workforce and to concentrate the school curriculum into the workforce and to concentrate the school curriculum on the skills valued or unmet in the local labor market” (p.9). States governments can encourage public colleges to improve graduates’ outcomes by explicitly tying “a specified share of two- and four-year college funding to the reported earnings of graduates in the five years following their graduation” (p.6). (Abstractor: Author and Website Staff)