Education

If California’s economy favors the educated, why do the poor earn fewer degrees?

Possessing a college degree in California is more valuable than ever.

It often indicates whether someone has a stable job and if their employer offers paid vacation or health benefits. For many, the degree is the difference between poverty and the middle class. And its value, since at least 2000, has only increased year after year, according to a new report by the Public Policy Institute of California.

There is a $44,000 yearly earnings difference between people who have college degrees versus a high school diploma, researchers concluded in a report released Monday. Yet, a significant number of Californians are not finishing college.

Employers are already facing a shortage of highly educated workers, said Hans Johnson, a higher education researcher who co-authored the report. Those jobs are plenty, but often exclude less-qualified workers who don’t have college degrees.

“We already see that in unemployment rates. We see it in a very large wage differential that college graduates enjoy relative to high school graduates,” Johnson said. “That’s already the case in our economy and unless we increase the number of students who go to and graduate with a four-year degree that will become more problematic.”

Median wages in the state have fallen in the last two decades for every education level except those with a bachelor’s degree and above, according to the report. Which is why getting more low-income Californians to complete college is important if the state wants to make a dent in its poverty rate, which is the highest in the nation.

The underlying issue noted in the report is the under-representation of groups that are most affected by poverty in the higher education system. African-Americans and Latinos account for a majority of the state’s high school students but do not fare as well at the university level. Researchers concluded a family’s income is still a key factor in whether or not a student goes to college.

What’s more, there is sometimes wide variation in access to certain institutions of higher education. While the California State University system most resembles the high school population, white students are overrepresented in private schools and Asian-Americans are overrepresented in the University of California System.

The report builds on previous work by the nonprofit think tank on higher education issues, including regional differences in achievement. The San Joaquin Valley and the Inland Empire were singled out in a 2017 study for lagging the rest of the state in terms of college completion.

“In the San Joaquin Valley, what we saw is the high school graduation rate is actually higher than the state average and the college-going rate is also quite robust,” Johnson said. “But the vast majority of students who go on to college from high school go to community colleges.”

Since the San Joaquin Valley has a number of universities, Johnson said the gap can be alleviated by improving the rate of transfers from community colleges to four-year universities. But the Inland Empire has seen lower college attendance rates overall, even though there are a lot of community colleges there. When students there pursue higher education, they go elsewhere.

“The other factor is the fact that the San Joaquin Valley’s economy does not tend to demand as many highly educated workers as in other areas in the state and that’s for obvious reasons,” Johnson said. “Agriculture is a large employer there and certainly, in places like the Bay Area you have the tech economy that demands a lot of high-skilled workers.”

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