Improving Labor Market Outcomes

Learning Objectives & Outcomes

After completing this module, participants will be able to:
  • Define the need for colleges to improve labor market outcomes for their students.
  • Examine and articulate strategies that community colleges can use to increase workforce outcomes for their students.
  • Analyze case studies to understand how a community college can develop a “collective impact” approach with employers that leads students to jobs with family-sustaining wages.

Module Overview

Though the United States has arguably the most dynamic and accessible college and university system in the world, future demand for workers with the skills and abilities provided by post-secondary education is projected to outstrip supply.[1] Economists debate the extent and nature of the “skills gap,” but there can be little doubt that the long-term economic and social health of the country is closely tied to the educational attainment of its citizenry.

Recent national and state-level efforts to increase college graduation rates aim to close the skills gap. The attention to college completion is well justified: Evidence overwhelmingly shows that, on average, college credentials have significant value in the labor markets.[2] The wage premium earned by college graduates—which is today at an all-time high when compared to those who only graduated high school—strongly suggests that employers value the skills that come with completing a college degree or certificate.

But, increasingly, it is clear that simply raising graduation rates alone will not be enough to deliver what students and employers need. In survey after survey, employers cite gaps among college graduates in basic skills they need for workplace success.[3] And while most students benefit from their degrees, there is evidence that some provide more limited labor market value.[4] The fundamental but thorny challenge that lies at the core of what community colleges today face is how to increase degree completion and, at the same time, make sure that the degrees students complete have enduring labor market value after they leave.

To ensure real student success, a community college must fix as its “North Star” a definition of success that extends beyond “completion” or “graduation” alone. Real success involves producing graduates who are truly prepared for what comes next, as evidenced by what they accomplish after leaving the institution. For some students, that means entering the workforce directly with a credential of enduring market value, reflected in their earnings following graduation. For others, it means transferring to a university and successfully completing their baccalaureate degree (and perhaps graduate degrees) before (re)entering the labor markets. Regardless, exceptional community colleges align programs with good post-graduation opportunities, ensure that students have the broad and specific skills they will need after graduating, regularly check to make sure that the intended student outcomes are in fact achieved after graduation, and use systematic feedback from employers and university partners to update and improve their programs.

This module explores how community college leaders can improve students’ labor market outcomes by working internally (with the campus faculty and staff) and externally (in partnership with employers). Of course, labor market outcomes—that is, the rate of employment and accompanying earnings of college graduates—reflect only part of the value conferred by higher education. Most policymakers and individuals recognize that, although higher education may provide immeasurable value in terms of personal growth, civic engagement, and a host of other positive outcomes, it is also an investment—one that everyone hopes will pay off for students in terms of employment and earnings, and for entire communities in terms of economic strength and quality of life.

The module begins by exploring the factors that contribute to the growing need to ensure that degree production is better aligned with labor market needs: not enough degrees are being produced in fields where the need is greatest and the value is highest. Though labor market needs differ across communities, this is both a national and a regional problem. Next, the module details and provides concrete examples of eight core practices that exceptional community colleges have used to achieve high levels of student success:

  • Align programs with labor market needs by examining data and holding conversations with employers
  • Work with employers to design curricula to ensure they are aligned to needed job skills
  • Help students make informed choices that align with labor market demands as they choose their pathways
  • Provide students opportunities for workplace learning through apprenticeships, internships, and cooperative education
  • Establish systems for regular and honest employer feedback on program quality
  • Secure employer investment in equipment, scholarships, and other resources tied to student success
  • Help students secure jobs and careers with good wages
  • Examine graduates’ labor market outcomes to assess effectiveness of programs in delivering skills aligned to jobs with good wages and make changes when weaknesses are identified

[1] Carnevale, A. P., Smith, R., & Strohl, J. (2013, June). Recovery: Projections of jobs and education requirements through 2020. Washington, DC: Georgetown University, Center on Education and the Workforce. Retrieved from http://cew.georgetown.edu/recovery2020

[2] Carnevale, A. P., Jayasundera, T., & Cheah, B. (2012, August). The college advantage: Weathering the economic storm. Washington, DC: Georgetown University, Center on Education and the Workforce. Retrieved from https://cew.georgetown.edu/collegepayoff

[3] Cortright, J. (2005, December). The young and the restless in a knowledge economy. Cleveland, OH: CEOs for Cities. Retrieved from http://www.ceosforcities.org/pagefiles/CEOs_YNR_FINAL.pdf

[4] PayScale. The most underemployed majors. Retrieved from http://www.payscale.com/data-packages/underemployment/most-underemployed-majors; Abel, J. R., Deitz, R., & Su, Yaqin. (2014). Are recent college graduates finding good jobs? Current Issues in Economics and Finance, 20(1). Retrieved from http://www.newyorkfed.org/research/current_issues/ci20-1.pdf; Schneider, M. (2014, May). Are graduates from public universities gainfully employed? Analyzing student debt and gainful employment. Education Outlook. Washington, DC: American Enterprise Institute for Public Policy Research. Retrieved from http://www.aei.org/publication/are-graduates-from-public-universities-gainfully-employed-analyzing-student-loan-debt-and-gainful-employment/

Preparation

Pre-Reading

  • Aspen Institute, College Excellence Program. (2015). From college to jobs: Making sense of labor market returns to higher education. Retrieved from: https://www.aspeninstitute.org/publications/labormarketreturns/
  • Aspen Institute, College Excellence Program. (2015). Innovation & focus to meet labor market demands: A case study of Lake Area Technical Institute. Appendix A of this module.
  • Aspen Institute, College Excellence Program. (2014). Using labor market data to improve student success. Retrieved from https://dorutodpt4twd.cloudfront.net/content/uploads/files/content/docs/pubs/LaborMarketDataGuide.pdf
  • Helmer, M. (2013, February). Helping adult learners navigate community college and the labor market. Workforce Strategies Initiative at the Aspen Institute. Retrieved from http://www.aspeninstitute.org/publications/helping-adult-learners-navigate-community-college-labor-market
  • Jobs for the Future & Credentials That Work. (2011, September). Aligning community colleges to their local labor markets.

Module Outline

Media