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CTE Research Review, Community College Edition

Research Image_6.2013The American Association of Community Colleges (AACC) released “Where Value Meets Values: The Economic Impact of Community Colleges,” quantifying the value of community colleges in terms of economic impact (i.e., to the national economy) and return on investment (i.e., to individuals and society).

Specifically, AACC found that, in 2012 alone, former American community college students generated $806.4 billion in added income, based on increased productivity and wages. Foreign community college graduates added another $1.5 billion in new income. AACC also found a 4.8 benefit-cost ratio for students based on the return to their investment into the community colleges (or $4.8 dollars in higher future wages for every dollar invested in their education). In total, AACC estimates $371.8 billion as the net present value of community colleges in terms of increased wages for individuals, after accounting for the money invested in the education.

At the societal level, AACC finds a benefit-cost ratio of 25.9 and a net present value at nearly $1.2 trillion, based on added income and social savings (i.e., lower health care costs, reduced crime rates, etc.) which are associated with more education and employment.

In addition to the report, AACC has created four fact sheets breaking down the data.

The Community College Research Center (CCRC) released a two-page policy brief on “Performance Funding: Impacts, Obstacles, and Other Intended Outcomes.” To date, 32 states have implemented some form of performance funding, with mixed results. The brief delineates performance funding 1.0 (where institutions receive a bonus over and above regular state funding) and performance funding 2.0 (where performance is built into the state allocations for institutions), and provides an overview of research-based lessons learned about performance 1.0. The CCRC is currently exploring the 2.0 model, as discussed in this working paper, “The Political Origins of Performance Funding 2.0 in Indiana, Ohio and Tennessee: Theoretical Perspectives and Comparisons with Performance Funding 1.0,” also released this month.

Kate Blosveren, Associate Executive Director

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