The Progressive Ensign

insights and analytics to build an economy that works for all

Category: Apprenticeship

Higher Ed Fading for Low Income Students

(Editor Note: Insight Bytes focus on key economic issues and solutions for all of us, on Thursdays we spotlight in more depth Solutions to issues we have identified. Fridays we focus on how to build the Common Good. Please right click on images to see them larger in a separate tab. Click on the Index Topic Name at the beginning of each post to see more posts on that topic on PC or Laptop.)

Photo: qz.com

Public colleges and universities have been the foundation of our society opening new opportunities for better lives, careers and mobility for students at all income levels.  Yet, for low income students the dream of a higher education degree and a better job is fading fast.  A non- profit research organization, New America, just released a report noting how low income students continue to struggle with the rising cost of education. It is true that the cost of higher education for all students has accelerated, in particular since the Great Recession. However, for lower income families the price increases have been especially acute.

Sources: New America, U.S. Department of Education – 10/31/18

The cost for low income students rose by at least $1000 in four years from the 2010 – 2011 to 2015-2016 periods for about 50 % of the public universities in the study. The report further notes a disturbing trend:

“The number of public universities that charged in-state freshmen with family incomes of $30,000 or less at an average net price under $10,000, has fallen from 361, or 62 percent of the schools examined, to 279 or 48 percent.”

Students at all income levels now carry a debt load of over $1.5 trillion dollars – the highest debt load recorded over the past twenty years.  This debt is keeping students from being hired if they have a poor credit record, purchasing a home or moving out from their parents’ home to an apartment.  New household formations are continuing to decline over the past 5 years. Unlocking the potential of our students to ensure they can begin their careers and families with a good financial start is crucial to the long term economic growth of our country and the happiness of our young people.

Next steps:

We believe that education in the U.S. is actually the Fifth Estate after The Press, and the three major branches of federal government.  We noted our concern about access to education in June post, “Funding Education to Common Good Levels Will Increase Prosperity and Reduce Civil Conflict.”  The National Center for Children in Poverty estimates that 40 % of all children aged 12 – 17 years old in the U.S. or 9.7 million are living in low income families.  This is a huge number of our young people not reaching their full potential while we miss their contributions and boost to our economy.

In that post we observed funding needs to be at magnitudes greater than today to make up for almost a 50 % reduction in state funding since 1975:

The key factor in how well education is building the common good across all income levels is funding.  Since 1975 funding by state and local governments for higher education has dropped from 60.3 % to to 34.1 % in 2010. The last eight years has seen this figure continue to drop close to 24 %. Public colleges and universities have coped with the unprecedented drop in state and local funding by raising tuition year after year to the point where students are now carrying the highest level of student loan debt ever at $1.5 trillion. Families can’t keep up with the tuition increases.”

We saw federal funding as necessary to balance the inequity across states:

“Total education US federal funding accounts for only 14 % of education spending vs OECD countries where national general funding is allocated across regions at 54 %. “

Or New America recommends that all federal higher education programs be combined together to support families and students based on a families’ ability to pay for their child’s higher education:

“At New America, we have also offered a much more ambitious approach. In our 2016 report Starting from Scratch, we proposed replacing the country’s federal financial aid system—Pell Grants, federal loans, and higher education tax credits—with a new federal-state partnership program that would eliminate unmet financial need for all students. Instead, the price students would pay would be limited to their Expected Family Contribution, the amount the government determines a household can afford to contribute toward the education of their children. Federal, state, and institutional funds would make up the difference between students’ EFC and the net price at the participating institution. “

We need high quality alternatives to a college education as well.  A study by the National Center for Education Statistics showed that 46 % of low income students did not attend college, many for financial reasons but also due to lack of interest or to start working.  From all income levels many high school graduates are not interested in a traditional college education, we need an empowering and certified apprenticeship program along the model that Germany has established to better meet the needs of corporations and give all non-college graduates opportunities for a well-paying job and career.

We as a society need to take responsibility for providing an education framework, access and funding so that all citizens can learn, progress and contribute fully to our society. Certainly this is the essence of a democracy our founding fathers envisioned of a well-educated citizenry building our country and economy that works for all.

Vocational Programs Match Young Workers with Good Jobs

(Editor Note: Insight Bytes focus on key economic issues and solutions for all of us, on Thursdays we spotlight in more depth Solutions to issues we have identified. Fridays we focus on how to build the Common Good. Please right click on images to see them larger in a separate tab.)

Photo: simplyhelp.org

Companies like CVS, Tesla, Electric Boat and others are working with local high schools and community colleges to train young workers with job skills that translate into good paying jobs. Direct connections between big corporations and local high schools are taking off. Volkswagen is helping schools in Tennessee modernize their engineering programs; Tesla is partnering with Nevada schools on an advanced manufacturing curriculum; and fisheries in Louisiana have created courses for students to train for jobs in “sustainability.”

There are 6.6 million job openings at the end of June 2018, many requiring specific skills in manufacturing, support, sales or materials management are the highest level in a decade.

Source: OECD, Federal Reserve Bank of St. Louis, Brookings Institute – 6/28/17

There are 3.6 million high school students enrolled in career education programs that provide immediate skills to fill job openings in career fields where there is high demand.

Of interest are programs that provide good paying jobs in industries with careers with a future growing into more responsibility and management.  Solar training programs sponsored by the federal government in 2009 worked with 400 local community colleges to try and meet the demand to fill 75,000 solar industry jobs by 2020. Over 30,000 students attended sponsored community college programs funded by the Department of Energy.  Funding for the program ended in several years ago however a new program has been implemented called the Solar Training Network. The Solar Training Network supported by a foundation brings together job seekers, trainers and employers in the industry to fill job demands.

In July the GOP Administration announced a $150 million apprenticeship program to help fill 4 million jobs that are in the apprentice sector for candidates without college degrees, women, ex-offenders and workers of color.  We applauded the program in a post then, but noted that a 40 % cut was included previously in the 2019 budget to a similar program in the Department of Labor – so staying power is a concern.

We are excited to see all these job training programs begin to get the visibility and funding to move ahead.  Though from our perspective with millions left out of the economic mainstream and with millions of jobs to be filled a massive jobs set of programs needs to be carefully designed and funded in the billions of dollars to even begin to come close to meeting the need and having an economic impact.

Apprenticeship Program A Good Step Forward

 

Photo: siemens.com

The Administration has announced a new job training and apprenticeship program focused on many hard to fill positions in manufacturing. The President signed an order to create a Council for the American Worker instructing the secretaries of commerce and labor to coordinate existing federal programs and focus on new apprenticeship programs for job seekers without college degrees and older workers.  Labor Secretary, R. Alexander Acosta noted prior to the announcement that in June 2017 the administration had allocated $150 million in funding to strengthen apprenticeship programs.

Officials from various job development interested groups including unions, corporations,  and trade association officials signed a ‘Pledge to America’s Workers’ committing to the creation of more career opportunities.  Many of the leaders had made previous commitments, though Fed Express announced a new pledge of 512,000 workforce development slots with tuition assistance provided.

While, ‘dual careers’ have been a staple part of German and European education programs in the U.S. the ‘college for all’ mantra has taken its effect discouraging apprentice program candidates. However, many European firms like Zurich Insurance have applied their experience with apprenticeship programs to their U.S. subsidiaries to fill positions and have shared their experience with U.S. based firms like Accenture and Walgreens. Apprenticeships are 4.0% of the workforce in Germany while in the U.S. the total is about 500,000 in skilled trades like plumbing, electrical or metal work, just a small fraction of the U.S. workforce.

Source: The Labor Department, The Wall Street Journal – 2016

American employers are struggling with filling many positions in manufacturing that require special skills but not at the level of a college degree. We expect that as more co-automation jobs are created apprenticeship programs will become the norm to accelerate the number of qualified workers and retrain those workers who lost jobs from automation.

We are pleased to see the GOP Administration move ahead with executing on its pledge to increase the number of apprenticeship training programs and enlist all interested stakeholders in the process. However, this Administration has also announced budget cuts of 40 % to a Department of Labor Workforce Innovation and Opportunity Act, so making the program work and develop momentum seems challenging given the mixed signals.  We see apprenticeship programs as crucial to expending jobs opportunities for the working class when they are combined with good salaries, benefits and continued training. Education is a bedrock institution to build a thriving society  for all not just the wealthy.

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