(Funding for this study provided by Nellie Mae) copyright 1993 Nellie Mae and MISER
Demographic change in New England has been particularly fast with regard to the racial and ethnic composition as well as to shifting the age distribution of the population. Part I of this study evaluates the effect of such demographic changes first on the educational attainment of the region's population and then on ultimate preparedness of the region's labor force
Key factors relating demographic change to educational attainment are highlighted in each of eight sections:
- Changes in wage and salary earnings by level of educational attainment in New England from 1970 to 1990.
- Current levels of educational attainment in New England.
- Changes in the educational system's overall performance over time measured in terms of retention and participation.
- Differences in educational performance by race and ethnicity.
- Differential growth and the explanatory factors of faster growth among the region's minority populations.
- Clustering of differential educational "success" among communities: are race and ethnicity all that matter?
- The impact of demographic change on higher education—competition among institutions: cost inflation, enrollment change, and institutional access.
- Expectations about the future:
- high school completions
- effects of economic growth and improved retention on school completions, and
- the future distribution of educational attainment in the work force if continuing improvement in current educational performance is not implemented.
The study shows that the aggregate educational attainment of the region is heavily related to performance differences among racial and ethnic sub-populations. Given that "minority populations" in some of the New England states are expected to rise by as much as one third, these populations will play an increasing role in influencing the educational attainment of workers entering the regional labor market. State policy throughout New England, therefore, must focus not only on increasing the number of college graduates, but also on achieving a balance in the educational attainment of population arrayed by race and ethnicity.
Evidence that major imbalances currently exist, however, in the New England labor market could not be clearer. These imbalances hamper the effectiveness of business development in New England and underscore the necessity of implementing educational policy to increase educational attainment in the region.
Part II of this study presents recommendations for educational change. These are aimed at improving the performance of low income and minority students. Recommendations are divided into two groups: those pertaining to elementary and secondary education and those pertaining to higher education. Some recommendations derive directly from interpretation of data, but most come from a careful review of the literature and policy making activity already underway. Many additional facets of policy making might have been considered, but ours are limited only to those which deal with the conclusions in Part I of this study.
SUMMARY SECTIONS
SECTION 1: Economic Returns to Education
Imbalances exist in New England's supply and demand of workers which have created mismatches between business needs and skill levels in the available labor pool. Thus, the costs of highly educated workers are greater than they would be if New England schools were providing more highly educated workers to the labor market.
Economically, it is in each person's interest—and in society's interest—to strive for a high level of educational attainment. Nationally, in 1990:
- Median incomes were twice as high for high school graduates, at $12,924, than for people with less than a high school degree, at $5,904.
- Individuals with Associates degrees earned on average $20,000 annually, with Bachelor's recipients earning approximately $25,000, Master's degree recipients $33,000, Doctoral recipients $46,000 and Professional degree recipients $60,000 on average per year.
Relative wage shifts among skilled and unskilled workers serve as good indicators of changing labor market conditions. Regionally:
- Workers without high school degrees lost economic ground between 1989 and 1991, with salary income actually decreasing 6.2% in absolute dollars during this period.
- People with four-year degrees enjoyed the greatest growth in median income between 1989 and 1991, with an increase of 3.2% in absolute dollars. Those with a high school diploma or with some college saw no change in wage and salary income between 1989 and 1991.
SECTION 2: Current Levels of Educational Attainment
The percentage of the population age 25 and over which achieved less than a high school diploma has decreased in each New England state. At the same time, the percentage of the same population with at least some college has increased. But the changes have still not been rapid enough to fuel the regional economy's labor force.
Four factors are primarily responsible:
- people have attained high school degrees at late ages remedying their earlier deficiencies;
- intra-regional migration brings more people completing high school than those not completing it;
- the mortality of older people eliminates a group from the population with lower high school completion rates than the young;
- a reduction of high school attrition has occurred among the young.
All of these changes did not, however, push people continuously up the educational attainment ladder.
In all New England states, there was smaller growth in the populations completing four year college degrees than in the population attaining some (but less than four years of) college. In other words, the spectacular growth in the rate of college attendance did not translate into similarly spectacular growth rates in completions of four year degrees.
SECTION 3: Review of the Educational System's Performance in Retention and Participation
In the 1980s, 29.9% of the total growth in college compilations in New England was accounted for by the sheer growth in population and the balance, 70.1% of the total growth, was accounted for by improvements in educational rates of completion and participation. While this educational improvement is impressive, it is not nearly as impressive as achievements in educational improvement accomplished in the 1970s.
There was greater percentage growth in four-year college degree attainment during the 1970s than during the 1980s. Between 1980 and 1990, the slower growth was responsible for retarding the increase in the number of people with four year college degrees. By 1990, the number of people with four year degrees or more barely surpassed the number of people without high school degrees. In a technologically advanced economy, this is probably inadequate to support the labor force needs of a growing economy.
During the 1980s, there were declines across all of the New England states in the rate at which students completed college once having started it. Therefore, the greater population growth in the 1980s compared to the 1990s was transformed into smaller growth in the amount of four-year college completions. This, in turn, is correlated with measurable weaker growth (or actual decline) in educational completion and participation rates.
SECTION 4: Performance in Schools: Differences in Growth in Completion and Attendance Rates by Race and Ethnicity
New England's growth in all racial and ethnic minority categories nearly doubles the United States' growth. This is particularly noticeable among blacks and Hispanics.
The major variations in college completion rates among the six New England states are not large in comparison to the more significant variations that occur among racial and ethnic groupings and among towns and cities, even within a single state.
College completion rates (the percentage of those who started college that completed four year degrees) in New England between 1980 and 1990:
- All persons = 53% (down by 4.84% from the previous rate)
- Hispanic = 43% (down by 13.92% from the previous rate)
- Black = 39% (down by 8.93% from the previous rate)
- White = 53% (down by 4.90% from the previous rate)
- American Indian, Eskimo, Aleutian = 33% (down by 13.93% from the previous rate)
- Asian & Pacific Islander = 74% (down by 3.74% from the previous rate)
- Other Races = 32% (down by 13.92% from the previous rate)
These figures suggest that the motivation expressed in seeking higher education (participation) is not matched for the minority populations by their degree attainment rates. The difference implies the need to improve campus racial climates, remediation programs and other outreach designed to level opportunities for success.
SECTION 5: The Growing Importance of Minority Populations in New England will Continue to Grow
Projections based on all of the available data indicate that the percentage of minorities living in New England and coming into the work force will increase dramatically over the near term future.
There are three reasons why minority populations entering the labor force in New England have grown significantly faster than the white, non-Hispanic populations:
- minority population is younger than the white, non-Hispanic population and therefore has greater percentages yet to enter the labor force;
- greater minority percentages in the fertile age ranges coupled with greater fertility rates imply more minority births which translate later into greater increases in the labor force;
- the minority population has higher, positive in-migration rates than the white, non-Hispanic population, and thus increases the minority share in the future labor force.
The Hispanic population is much more heavily represented by younger populations than by other ages; 50% of the Hispanic population is under 25 years of age, compared to 45% for blacks and Asians, and only 30% for whites. Minority populations also have higher in-migration rates, while the white population shows negative out-migration.
SECTION 6: Clustering of Educational Attainment Among Communities: Factors Other than Race and Ethnicity that Affect School Completions
The variables affecting educational attainment have less correlation with the minority status of a community than with its income. This provides some rationale for the notion that educational attainment is less a product of race and ethnicity than of income and class.
- Only 3.59% of the variation in educational attainment is explained by data on the racial and ethnic composition of a community;
- INCOME coupled with race and ethnicity explained 42.77% of the variation across the region in four year degree completions by residents. At the state level, three of the six New England states had more than 60% of the variation in their communities' college completions explained when income was added to race and ethnicity.
Language is also an important barrier to learning and progressing through school that is related to race and ethnicity, especially for those Hispanic and Asian households where no adults speak English at home (termed: linguistic isolation).
- 26% of Hispanics are linguistically isolated;
- 30% of Asians are linguistically isolated.
Another factor widely acknowledged to influence educational attainment and not necessarily related to race and ethnicity, is teen age pregnancy and the attendant issues related to single mothers.
- The total numbers of births to young mothers are highest in Massachusetts and Connecticut because of the larger populations in these states.
- The highest rate per thousand women between ages of 15 and 24 occurs in Maine and Vermont. High fertility rates at young ages is therefore not associated only with minority populations; there are comparatively few minorities in Northern New England.
Most significant is that in every New England state more than 25% (in some states nearly 50%) of births to women in this age group are to women who were not married and who still were unmarried as of the 1990 Census. As a result, many of these women face issues such as school attrition, poverty, and certain needs for day care facilities.
- In Massachusetts, calculations show that 30.4% of all unmarried women in the age range of 20–24 who became mothers as teenagers fail to complete high school and then later do not earn equivalent degrees. In comparison, only 9.4% of unmarried women who were not teenage mothers failed to get high school degrees or equivalent.
Clearly, without dealing with issues attendant with teenage pregnancy, motherhood and day care, a significant root cause of low school attainment will continue unabated.
SECTION 7: The Impact of Demographic Change on Higher Education: Competition, Cost Inflation, Enrollment Change and Access
Demographic change in New England goes beyond the increasing volume of young, minority populations. There has also been a significant decline in the total volume of 12th grade students, comprised largely of a declining white, non-Hispanic population. These declines have had their own independent effects on educational attainment, mostly through associated impacts on college costs and higher educational access.
Losses in numbers of students completing high school over the 12 years between 1980 and 1992 were greatest in CT, MA, and RI, where each lost 1/3 of their 12th grade enrollments. Losses were less severe in the north—less than 10% for New Hampshire, slightly more than 10% for Vermont and as much as 20% for Maine.
Student-borne costs rose faster than the Consumer Price Index (CPI) in the 1980s, both because of increased recruiting costs and the need for wider financial assistance. The result is that college costs absorbed an increasing part of the average family budget during the period, putting a premium on access.
SECTION 8: Expectations about the Future
The age distribution of the current population and the growth in minority populations will have a sizable impact on the likely educational preparedness of the future work force.
From 1985 to 2012, projections show that the minority populations in Connecticut ready to enter the work force may increase from 18.1% to more than 33% of the total population if current patterns continue to hold. Similar change will be seen in Massachusetts, with a projected increase from 11.6% to slightly less than 33% over the same period. Other New England states are expected to have large increases in minority population growth as well.
Without a change in school and college performance, New England will continue to experience shortages in the better educated segments of the population. The most rapidly growing segments of the population have historically attained the lowest levels of education. Therefore, growth in an educated work force now heavily depends on improving the educational "success rate" of minority populations.
Without a concentrated effort to increase educational throughput, there will undoubtedly be an inadequately trained work force in the region during the next decade.
For more information: Download a full copy of BEYOND 2000: Demographic Change, Education and the Work Force.