the great divide: socio-demographics and the new economy

8/3/2019 The Great Divide: Socio-Demographics and the New Economy

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5/5/12

The Great Divide: Socio-Demographics and the

New Economy

John W. Bardo [email protected]



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The Push for CollegeGraduates

Universities and community collegesare facing increasing pressure toexpand the number of college

graduates based on largely on thenotion that the majority of “good jobs”in the future will require college

education

According to various estimates, as

many as 63 percent of all jobs



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Jobs in the New Economy

The term “New Economy” describesaspects or sectors of an economy thatare producing or intensely using

innovative or new technologies. Thisrelatively new concept appliesparticularly to industries where people

depend more and more on computers,telecommunications and the Internetto produce, sell and distribute goodsand services. (OECD, 2011)



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Prosperity in the New Economy is seenas tied to education.

For an entity—in this case a state—tobe prosperous, it must have an

educated workforce

Given the changing demands, it is

understood that this cannot beaccomplished without includingtraditionally under-involved people

including women, minorities, and thosewith low-income



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However, policy discussiondoes not currently focus on thespecific structure of the linkbetween the New Economy

and Education, nor thepatterns of enrollment andemployment of the key

populations (women,minorities, and low-income)who will compose asubstantial if not ma orit of



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My Research…

What are the key structures of the NewEconomy that might be related todemand for educated labor,

unemployment, state GDP, andaverage household income?

To what extent do patterns of enrollment in four-year colleges anduniversities relate to these key

structures and economic performance



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Innovation and Entrepreneurship

“Very few Americans areaware that small and

medium-size businesses areresponsible for most of the

jobs in America”

(Jim Clifton (2011), The Coming Jobs War. New York: Gallup

Press, p.29)



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According to Richard Florida…

“Real wealth is based on the ‘thegoods and products we wish toconsume or of the things (factories,

machinery, and educated workforce)that give us the ability to producemore such goods and services.’”

(Richard Florida (2010) The Great Reset. New York: HarperCollins,

p. 111)



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Key “New Economy”Structures

• Magnitude of the state-level NewEconomy

• Business Innovation

•

Education-linked Innovation

K I di t B i



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Key Indicators: BusinessInnovation

v

Employment in high tech businesses as a percent of all employment

vComputer specialists as a percent of the workforce

vBusiness R&D as a share of industry inputs

vEngineers as a percent of the workforce

vSBIRs per million dollars of state GDP

vVenture capital per million dollars of stateGDP

vS&E graduate students per thousand

people age 25 to 34

K I di t Ed ti



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Key Indicators: Education-linked Innovation

vAcademic R&D as a percent of state GDP

vS&E bachelor’s degrees per 1000 18-34year olds

vPercent of 25 to 44 year olds who are highschool graduates

vS&E graduate students per thousandpeople

age 25 to 34vSBIRs per million dollars of

state GDP



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ey oc o-demographic/enrollment

constructs•State college-going intensity (not rate)

•

Traditional college enrollment

•Hispanic diversity

• Traditional diversity (percent women, percent

African American, and Percent on Pell Grantskey indicators)

•Financial aid—cost discounting

•Education loans (“middle-income” financial



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Projections of Jobs RequiringDegrees by State

Component Coefficient

Business Innovation .30

Education-Linked Innovation .39

Traditional Diversity -.25

Financial Aid--Cost Discounting -.35

R2 .56



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Median Household Incomeby State



Traditional College Enrollment .17



Education Loans .27

R2 .75



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e an ouse o ncomeby State with Percent

College GraduatesComponent Coefficient


Traditional College Enrollment -.05



Education Loans .24

Percent of Adults with CollegeDegrees

.42

R2 .81



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Per Capita GDP by State(Without Arizona and Delaware)


Hispanic Diversity .31


Education Loans .58

R2 .54



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With Percent CollegeGraduates

(Without Arizona and Delaware)


Hispanic Diversity .29


Education Loans .51

Percent of Adults with CollegeDegrees

.23

R2 .58

A li d U l t



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Annualized UnemploymentRate by State, 2009

(Without Michigan)


Magnitude of the New Economy in

State

.26

Education-Linked Innovation -.31

Traditional Diversity .27

R2 .31

nn a e nemp o men



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nnua ze nemp oymenRate by State, 2009 IncludingPercent Adults with College

Degrees(Without Michigan)


Magnitude of the New Economy in

State

.27

Education-Linked Innovation -.27

Traditional Diversity .26

Percent Adults with College -.08

R2 .31



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What About Education-Linked

Innovation?


Traditional College Enrollment .51


Enrollment Intensity .26

Hispanic Diversity -.25

R2 .48



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Some Policy Approaches

• States need to be careful that the “completionagenda” does not undermine the key role of Education-linked Innovation associated withgraduate education, R&D, and technology transfer.Increasing support in these areas would be evenmore beneficial

• Universities must find ways to increase theeffectiveness and efficiency of undergraduateeducation as measured by meaningful studentlearning and increased throughput

•States need to adopt a unified approach to highereducation and economic policy consistent with theNGA “Best Practices” papers



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§ Create a national dialog that focuses morespecifically on the types of education that arenecessary to be competitive

§ Assess science in elementary schools: teachers focus

on what is evaluated

§ Train teachers regarding best practices in earlyscience education

§ Focus on self-esteem and self-confidence; these arekey issues

§ Create a national mentor program for traditionalminorities and Hispanics

§ Better advertise and support scholarship programsfor science and technolo ma ors

States must recognize the importance of “inclusion” if they are to meet theireducational and economic goals



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•

At universities, expand services and supportsystems for traditional minorities and women

• Expand and fund support for studies of disincentives that affect under-representedpopulations majoring in critical need areas

• Work with the professional associations to dealwith the subtle messaging that affects

professional self-esteem and confidence



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American competitiveness isbased on linking educationalachievement, economicinnovation, and inclusion…there

is no “silver bullet”

the great divide: socio-demographics and the new economy

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