Have you ever advocated for more financial aid and been met with skepticism? Have you ever had a policymaker ask you whether college is worth it at all? If so, you’re not alone. Research shows that the public is growing increasingly skeptical about the value of a college degree, which is contributing to a decline in the proportion of students pursuing college after high school. A recent study found that 70% of young adults without college degrees considered higher education a “questionable investment.” While the pandemic no doubt contributed to those trends, that’s not the whole story. There’s a brewing backlash against college
in some corners of the country, and it could have long-term ramifications for our nation.
NCAN members and partners understand that higher education leads to economic mobility for individuals and families and that investing in higher education drives economic gains for communities, states, and the United States as a whole. But what, exactly,
is the value for each state, in strictly economic terms, of making college more accessible? That’s what we set out to learn in this new analysis we’re releasing today. The result of our four-month partnership with Recon Insight Group is a set of state
cards that make a clear case that investing in college pays off – not just for the people who pursue and attain a degree, but for the taxpayers and residents of the state doing the investing.
Our new state profiles show the economic benefit of additional postsecondary graduates in each state. This research bolsters advocacy efforts aimed at reducing the cost of college by quantifying the long-term gains to state economies of producing more
postsecondary graduates. Put simply, these state cards allow NCAN members to say precisely how many more jobs are created, how much the state GDP grows, and more, for each additional college graduate (defined as someone with an associate or bachelor’s
degree.)
While the effect of higher education on individual earnings has been well-documented, this analysis looks at the economic value for states of investing
in postsecondary education. For each state, the analysis quantifies the economic contributions per postsecondary graduate on a broad range of metrics, including:
Contributions to a state’s GDP, both annually and over their lifetime
The creation of supportive jobs as a result of the employment of each postsecondary graduate
Increased spending on housing, and higher home values for residents and taxpayers
Expansion of the state tax base
Increased spending on auto and transportation costs, compared to those without postsecondary education
These metrics demonstrate that when students can afford college, state economies benefit. In a broad variety of areas, including housing, transportation, and the job market, the new state profiles provide further evidence of the widespread economic value
of education beyond high school – and particularly, how state economies benefit from additional postsecondary graduates.
Our analysis suggests that investing in college can dramatically strengthen a state's economy:
In Texas, each additional postsecondary graduate expands the tax base by $7,361 on average, which is greater than graduates in any other state.
In Georgia, postsecondary graduates contribute an average of $164,154 more to the state GDP each year, compared to those with no college degree.
In Illinois, home values of postsecondary graduates are $123,316 higher, on average, compared to the home values of those with only a high school diploma.
Automotive and transportation spending increases by over $4,000 in California and New York for those with postsecondary degrees.
Our findings show that the attainment of higher education is also beneficial for job creation in each state, as individuals in managerial roles often rely on supporting staff to do their jobs efficiently and effectively. In Florida, the
average employment of postsecondary graduates leads to the creation of almost seven supporting occupations.
Significant economic benefits aren’t confined to one state or region. Our findings highlight bolstered economic activity, tax base expansion, and increased spending in all states, as a result of education beyond a high school diploma.
This research underscores the critical role of postsecondary education as a driver of economic activity across the country. In each state, postsecondary graduates contribute more to the GDP, expand the tax base, and spend more on housing and transportation
than those with no postsecondary education. This research adds compelling evidence of the pivotal role of higher education in fueling robust economic prosperity at the state level. When college is within reach for students, states win, too.
The economic value state profiles can be found here. Questions about the research can be directed to Catherine Brown, Senior Director of Policy and Advocacy,
at brownc@ncan.org or Louisa Woodhouse, Policy Associate, at woodhouse@ncan.org.
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