Jamie Merisotis, President and CEO, Lumina Foundation
Economic Club of Florida, Tallahassee, FL
Thank you, and good afternoon everyone. I’m pleased to be here today—and not only because this visit gives me a temporary reprieve from the winter weather in my home city of Indianapolis. I’m excited to be with you because I feel we have a lot in common. After all, as the current president of the Economic Club of Indiana, I feel like I’m in something of a comfort zone here. I appreciate the value of organizations such as this, and I’m quite aware of the power and potential represented in this room. I know first-hand that the men and women drawn to such groups, if properly organized and motivated, can be a tremendous force for good in their communities—a real catalyst for positive change.
And make no mistake: Positive change is what I’m here to talk about today … substantive change in college success rates—and your role in helping make that change happen.
You’ve just heard in the introduction a bit about Lumina Foundation and where I am coming from. The foundation’s raison d’etre for the last five years—what we call Goal 2025—has put us in a unique leadership role nationally. That goal, as you just learned, is that by the year 2025, we want 60 percent of Americans to hold high-quality college degrees, certificates or other credentials.
The Goal 2025 effort is more than just a good cause. In fact, it is an urgent need – a national imperative.
Lumina’s work in recent years—bolstered by ongoing research from many noted economists, labor experts and thought leaders—tells us that the Goal 2025 effort is more than just a good cause. In fact, it is an urgent need … a national imperative.
Nationally, and in nearly every state, we are far from this 60 percent goal right now. Here in Florida, according to the most recent Census figures, 37 percent of the state’s working-age residents—that is, Floridians between ages 25 and 64—have at least a two-year college degree. That figure is virtually unchanged over the last four years. In short, attainment rates are essentially flat here in Florida … and when it comes to educational progress, flat is frightening.
In any city, the key factor in economic growth and job creation is the education level of its residents
That’s because educational success is inextricably linked to economic prosperity. Economists and labor experts agree that, in any city or region, the key factor in economic growth and job creation is the education level of its residents. Without access to a well-educated workforce, today’s business has little chance of surviving, let alone thriving, in the global economy.
As all of you are aware—sometimes personally and painfully aware—American companies and workers no longer merely compete with their counterparts in nearby states or regions. Today the competition is worldwide … and it is fierce. Unfortunately, when it comes to preparing the nation’s labor force, we’re slipping dangerously. College-attainment rates are soaring among young adults in many other nations, but our national rate has been stagnant for decades. In fact, so many nations have moved ahead of us that we’ve fallen to 15th in the proportion of 25- to 34-year-olds who have obtained a two- or four-year degree. Clearly, this is very troubling. We need to ramp up if we hope to keep up.
By now, the case for increased college attainment is well-documented—and by “college” I am referring to all forms of post-high school or postsecondary education, not just four-year degrees. The simple fact is, two-thirds of all of the nation’s jobs will require some form of postsecondary education by the end of the decade. That’s a huge increase since the mid-’70s, when only about a quarter of those jobs required any education beyond high school.
In the next decade Florida will will need to fill some 2.8 million job vacancies
What that means here in Florida is that, in the next decade, this state will need to fill some 2.8 million vacancies resulting from job creation, worker retirements and other factors. Of these expected vacancies, well over half—about 1.6 million jobs—will require postsecondary credentials. In short, we have a huge gap to fill. And failing to do so will result in devastating losses: massive amounts of unrealized human potential, perhaps hundreds of thousands of Florida jobs that are likely to go uncreated or unfilled.
Anyone who doubts the value of a college credential would do well to look at the facts.
Labor experts tell us that, in any city or state, the key factor in economic growth and job creation is the education level of its residents. And there’s ample evidence to support that claim:
- Employers here in Florida and throughout the nation are having more and more difficulty finding workers who are properly equipped for today’s increasingly complex jobs.
- The Georgetown Center on Education and the Workforce points out that, in 1973, only 28 percent of all U.S. jobs required postsecondary training. By 2010, that number had increased to 60 percent, and that trend is sure to continue.
- We also know that Americans with a high school diploma or less accounted for four out every five jobs lost in the recent recession—and those low-skill jobs are continuing to disappear, even during the recovery period. Meanwhile, workers with bachelor’s degrees have continued to gain jobs, even during the worst of the slowdown.
- In fact, since the Great Recession’s official end in 2010, the economy has added 2 million more jobs that require a four-year degree, and more than 1.5 million for those with associate’s degrees. Many of these jobs have gone to young people. It’s true that the job market hasn’t exactly been kind to recent graduates, but those who lack college credentials are far worse off. According to data from last year, national unemployment rates for 18- to 24-year-olds (not enrolled in school) were below 9 percent for those with bachelor’s degrees and 12 percent for those with associate degrees. For those with only a high school credential, the unemployment rate was a whopping 24 percent.
- If you need more proof, just follow the money. Bachelor’s degree holders earn an average of 84 percent more over their lifetimes than those with just a high school diploma. This wage gap is nothing new, of course, but you may be surprised to learn that it’s actually gotten wider in recent years. As recently as the late 1990s, the lifetime wage differential for four-year college graduates over high school graduates was only about 75 percent.
These statistics show clearly that the labor market is hungry for college graduates, and it’s getting hungrier all the time. Even in this tight job market, employers are willing to pay more for college graduates … because more and more of these employers are having difficulty finding the types of skilled workers they need.
Of course, the benefits of higher education aren’t just economic, and they’re not just limited to individuals. In fact, the social and cultural benefits of a well-educated population are enormous. We all know—and social science research actually shows —that college-educated citizens are more globally aware, more engaged, more apt to make reasoned and ethical decisions than those who lack higher education.
On every front, then—individual and societal, economic and social, national and local—increased college attainment is a powerful progressive force. And here’s the thing: It is a force that a state or city or region can unleash if the various stakeholders in that community take the right steps … and if they take those steps together.
Clearly, that’s happening here in Florida. As an example, the state Chamber of Commerce has put the issue of educational attainment front and center in its Six Pillars Plan, the 20-year blueprint for securing the state’s future. It’s no accident that the very first pillar addressed in that document is one called “Talent Supply and Education.” The Chamber’s plan includes important messages about increasing degree attainment and aligning the education system at all levels, from pre-K all the way into the workforce. Those messages are well worth heeding, and I’m happy to say they are being heeded here in Florida.
In fact, there are many promising signs in this state—steps and trends that bode well for Florida and in which you can take great pride. For instance:
- There’s the Florida College System. The rich array of community colleges that cover the state should be seen as a solid base of that “Talent Supply Pillar” I just mentioned. Chancellor Randy Hanna and the leaders of these state colleges deserve tremendous credit for their work. These schools serve some 900,000 students a year—including 65 percent of Florida high school graduates, and more than 80 percent of the state’s minority students during their first two years. And a big part of that service—to students and to the state—is in creating and maintaining clear pathways to the workforce through programs that actively involve local employers.
- The State University System is another point of pride. These universities play a hugely important role in the state’s economic and social well-being, awarding more than 70,000 degrees annually at the bachelor’s degree level and above. The system’s chancellor, Frank Brogan, is a strong voice for educational quality and accountability who has put student success at the top of his agenda.
- Often overlooked is the impressive work being done by the state’s 31 independent colleges and universities. These private, non-profit institutions contribute a quarter of all bachelor’s degrees to the state’s total each year and have high levels of student success.
- And there’s another strong advocate for student success on the scene now in Florida: your state’s new public education commissioner, Tony Bennett. Having worked with him in Indiana, I know that Dr. Bennett is committed to excellence and focused on results for all students.
Coming from outside the state, one interesting and important trend I’d highlight is that state leaders and institutions have worked consistently to keep tuition costs low and to operate efficiently within those funding constraints. In fact, Florida colleges are among the most efficient in the nation, as measured by expenditures per degree or per student. This may be due in part to the embrace and expansion of online programs—programs that make college-level learning affordable and accessible to a much wider and more diverse swath of the state’s population.
This leads me right back to the main theme of my remarks this afternoon: the pressing need for change.
The most salient issue for Florida—and for nearly every state, city and region—is one of talent … developing the talent necessary to spur economic growth, support lasting prosperity, improve the quality of life and ensure security and stability. Without question, the key to talent development is education. And even though genuine progress is being made here in Florida, it’s clear that progress is too limited and too slow.
The fact is, college-attainment rates are well below the level that positions you for success and stability in the 21st century global economy. You need to address this problem now … and you must do so in a way that is collaborative and committed.
After several years of intense engagement in this work, we at Lumina are encouraged by the energy surrounding this effort across the nation. We’re absolutely convinced that the 60 percent goal is achievable, and we see at least the outlines of the path that will lead us there. But we’re also acutely aware of an unavoidable truth: We can’t reach the goal by conducting business as usual.
Again, let’s look at the facts. At its current pace, Florida will reach a degree-attainment rate of about 43 percent by 2025—well short of the 60 percent goal. So, the question is: How can you accelerate progress … especially with limited funding on the horizon to fuel that acceleration? Another vexing question: How can you increase attainment while also broadening opportunity for minority populations? Census data show that about 41 percent of white, working-age residents of Florida have at least a two-year degree. Among Latinos, the rate is far lower, just 31 percent; and among similarly aged African Americans, it’s lower still: only 25 percent.
For the state to address the equity imperative and reach its college-attainment goals, Florida—indeed, the entire nation—must have a preeminent higher education system. And that system simply can’t be a clone of the one that’s now in place. It needs to be a redesigned system, one that is flexible, affordable, and quality-focused to properly serve the needs of students, employers, and the state’s civic and social well-being.
At Lumina, we’ve thought a lot recently about this redesigned system. We’ve had to … because it is becoming increasingly clear that the current system just can’t get us where we need to be as a nation.
It’s not just a capacity issue. Even if it were possible simply to “super-size” the current system, we’d still fall short of Goal 2025. That’s because the problem isn’t just about scale. It’s about structure. The fact is, higher education needs to operate in new ways. It needs to be redesigned so that it better meets the needs of today’s students and positions the nation for success in our 21st century global society.
This redesigned system must deliver high-quality education to the growing numbers of low-income, first-generation, minority and adult students who represent our future as a nation. And it must do so with a specific eye toward what the state needs to thrive economically and socially. In other words, higher education must be retooled so that it is both more affordable and more productive. It must become a truly student-centered system—one that ensures access to all types of students, gives those students the support they need to succeed, and enables them to earn credentials that demonstrate real and relevant learning.
While I don’t have time today to go into extensive detail about this redesigned system, I would at least like to highlight three specific areas where fundamental change is needed:
- First, we need a new system for financing higher education. Our current tuition and student aid systems were designed decades ago to meet student needs and social and economic conditions that are dramatically different from those we face today. Clearly it’s well past time for a new model, one that can direct resources to support the success of today’s students—a much larger and far more diverse group than ever before. Redesign of the financing system must focus on ensuring that priority is given to these 21st century students, who need the most support both to get into college and to help make sure they succeed when they get there.
- Second, we need new higher education business and finance models that significantly expand the nation’s capacity to deliver affordable, high-quality education. Without an expanded array of affordable higher education options, it will be impossible for the nation to substantially increase higher education attainment. Since current financial models were built around traditional approaches to delivery, new and more productive business models that rely on affordable, lower-cost academic delivery are needed to expand the nation’s capacity to deliver high-quality education. These models must be supported by public finance and regulatory policies that create incentives and remove barriers to change.
- Finally, we need to redesign our approach to credentialing. For far too long, credits and degrees have been awarded, not for what students know and can do, but on the basis of the time they spent in class. That means their credentials don’t necessarily represent knowledge and skills that are valued in the workplace. We need a new credentialing model—one that is based on learning rather than seat time … one that provides more and better-articulated levels of achievement … one that is aligned in new and stronger ways with workforce-development systems.
Lumina is committed to working on many fronts to help bring about these changes … and I’m happy to talk about those efforts in the question-and-answer session that follows my remarks.
For the rest of my time, though, I don’t want to talk about what higher education needs to do; I’d rather talk about what you can do to help make Goal 2025 a reality. Individually, as employers and civic leaders, you can play a vitally important role in this effort. The best way to approach this work is to view it from three perspectives or through three lenses: company, community and country.
From the company perspective, each employer can take direct and meaningful steps to aid college attainment among its own workers. Some examples:
- More and better programs that provide tuition reimbursement.
- Flexible work scheduling to allow workers to attend college classes.
- Assistance and counseling to help create individualized learning plans for workers, including encouraging prior learning assessments to recognize college-level learning already acquired. This will both accelerate time to the credential and hold down the costs of credential completion.
These and other incentives for employees should be developed to help employees pursue certificates, degrees and credentials of all kinds.
Next, from the community perspective, employers should make education a central plank in their platform of community engagement and service. In fact, boosting attainment should be at the top of the list when it comes to corporate responsibility efforts. What better way to demonstrate good corporate citizenship than to foster an “education-friendly” workplace?
Finally, and most broadly, employers need to view the Goal 2025 effort through the larger lens of country. Florida’s employers—and really, all of us as Americans—need to be advocates for increasing college attainment because that’s what the entire country needs.
What kind of advocacy is required? Well, one specific kind of advocacy we need is at the policy level. Just as we’ve seen at the K-12 level, with the active involvement of business leaders in causes such as effective teacher education and charter schools, we need an equal level of involvement in higher-ed reform. After all, with two-thirds of jobs being created requiring some form of postsecondary education, we need to acknowledge that while K-12 improvement is absolutely necessary, it’s also insufficient.
The truth is that dramatic improvements at the K-12 level, and all of the efforts to fix our schools; to reward high-quality teaching; and to help make students college-ready—all of that merely gets students to the starting line. Employers must do all they can to help get them to the finish line—and that means some type of high-quality postsecondary education.
Specifically, what we need is active engagement in issues like improving productivity in higher education—increasing the capacity of the system to serve a lot more students, at the lowest possible cost, while ensuring that underrepresented populations get top attention. It means focusing on the large numbers of adults who have been knocked out or shut out of the evolving labor market, where postsecondary skills are in such demand. And it means pushing policymakers to make college success a priority, with clear goals and measurable results.
So you see, Goal 2025 isn’t something for Lumina to achieve. It’s not a wholly owned effort of philanthropy … or employers … or state and federal policymakers … or the higher education community. It is—and it must be—a broad-based, inclusive and intensive effort that we all embrace.
Everyone in this room has felt the transformative power of education. And we all know that power needs to be more broadly shared. I urge you to do all you can to make that happen because the payoff will be huge … for all of us.