Site Search

Executive Summary and Introduction

Executive Summary
and Introduction

Decades of unprecedented technological advances have remade the U.S. and world economies. Mainstay industries such as heavy manufacturing have declined while entirely new fields have created millions of jobs, permanently altering the economic landscape. And more change is on the way.

In this environment, ensuring that Texas students have the range of technical skills they need to pursue a successful career is a critical goal, both for the individual and the state as a whole. Many Texas businesses simply cannot prosper without a growing labor pool of skilled technical employees.

At present, however, most of the state’s attention is devoted to encouraging and preparing students to earn four-year degrees. But there are other paths to success, and we neglect these at our peril.

Regardless of how much we promote university education, a large number of Texas students simply will not choose to attend a four-year school. But our economy is large and diverse enough to provide them with rewarding careers and strong incomes – as long as they acquire the postsecondary training they need to succeed.

Many high-paying and rapidly growing professions are open to persons with technical training. In 2007, more than 80 percent of all Texas jobs did not require a bachelor’s degree (Exhibit 1). More importantly, neither did nearly 44 percent of jobs paying an above-average income for the state (Exhibit 2). That included more than 343,000 jobs requiring an associate degree and paying average annual earnings of $53,229, as well as 79,000 jobs requiring technical certificates and average incomes of $46,616 (Exhibits 3 and 4).

And the U.S. Department of Education estimates that about 80 percent of the fastest-growing job categories in the near future will require some postsecondary training, but not a bachelor’s degree.¹

Texas has a number of community and technical colleges that can offer our children affordable, state-of-the-art training for jobs with a future after just one or two years. As Chapter 4 of this report documents, they make important contributions to the state economy; their graduates’ incomes generate about $10.1 billion in the Texas economy each year. And they can play a vital role in ensuring that Texas continues to prosper in challenging economic times.

But to maximize the effectiveness of our community and technical colleges, the state must ensure that its policies help rather than hinder them.

A “One Size Fits All” Model

Many state policies are geared largely toward pushing all students into university programs (see Chapter 2). These policies may inadvertently send the signal that the four-year degree is the only path to success.

The Texas high school class that entered the ninth grade in Fall 2007, for instance, will be required to meet the new “four-by-four” standards, which require four years each of language arts, social studies, math and science. But some applied science and math courses relevant to technical courses will not count toward the four-by-four requirements.² The new requirements may force many students to abandon career and technical education (CTE) courses.

Similarly, proposed new grade-point average (GPA) calculation standards for high schools would only include CTE courses aligned with university programs such as accounting.³ Many technical courses will not count toward the calculation of student GPAs, giving students less incentive to enroll in them.

Furthermore, the ability of our community and technical colleges to train skilled workers has been hampered by declining state funding. As Chapter 3 illustrates, state funding for community and technical colleges has not kept pace with inflation and is falling in real terms. And while CTE courses can be quite expensive to establish, often requiring state-of-the-art technology and equipment, the state does not offer funding for startup costs. In some urban areas, employers donate materials and equipment and allow students to train in their facilities, but rural institutions often lack such partners.

Such state policies are shortsighted, both from the perspective of individual students and from that of Texas as a whole, which needs a productive, skilled work force with a variety of technical skills to compete successfully.

The Skilled Worker Shortage

Dwindling enrollment in vocational training is starting to affect many Texas businesses that face shortages of skilled workers. Employers in and near the cities of Corpus Christi, Port Arthur, Beaumont and Texas City report that they cannot find enough welders. One large petrochemical company representative said that they have needed more welders than they can hire for the past two years.⁴

Carol Wilson, senior human resources director for Centerpoint Energy, told Comptroller staff that “it’s getting tougher to find people for technical skills-related positions. The demand is greater than the supply.”⁵

And the existing supply of skilled workers is aging. The Wall Street Journal recently noted that “unions, construction contractors and other businesses” are facing impending shortages of skilled workers since many of them are reaching retirement age, and there are too few young workers with the skills needed to replace them.⁶

The impending wave of retirements in the baby boom generation will remove many of our most experienced and skilled technical employees from the work force. This may drive up wages for a wide variety of technical occupations, and force employers to import labor from other states or other countries.⁷ Both are costly solutions, and may ultimately lead employers to reduce operations or relocate elsewhere.

Texas’ publicly funded higher education institutions are not meeting this demand. In 2007, for example, Texas had roughly 44,000 job openings for workers with some postsecondary technical or career training, but the state’s public institutions produced just 36,442 students with the skills needed for those jobs.⁸

By contrast, in the same year, our public universities produced more bachelor’s, master’s and doctoral graduates than the economy could employ, awarding about 104,000 degrees while the state added just 85,000 jobs requiring a bachelor’s degree or above (Exhibit 5).⁹ Private Texas colleges and universities added another 26,000 graduates, for a total oversupply of about 45,000.¹⁰

It should be noted that privately funded career schools greatly supplement our supply of skilled technical workers, graduating more than 53,000 students with a diploma, certificate or some other credential in 2007.¹¹ Even so, these data provide further evidence of the way in which Texas public policy pushes students toward the university regardless of the actual needs of the state economy, or the economic prospects graduates face.

Challenges

Foregoing postsecondary training and education can mean a tremendous loss of income over a lifetime. A student who earns an associate degree, for example, will earn an average of $340,000 more over a working lifetime than someone with just a high school diploma – and nearly $600,000 more than a worker with no diploma.¹²

These increased earnings, moreover, can be achieved with a relatively small investment of time and money. Tuition and fees for two years at a community college in Texas, for example, cost an average of about $3,800, compared to more than $26,000 for four years at a public university.¹³

Yet far too many Texas high school students fail to pursue postsecondary education, despite its obvious benefits and advantages. As illustrated in Chapter 5, their reasons tend to fall into three broad categories:

• inadequate knowledge about school programs and financial aid opportunities, and how to take advantage of them.
• institutional and bureaucratic obstacles that make it difficult for students to obtain career and technology education.
• financial barriers, and the inability of financial aid systems to reach those most in need.

All of these challenges are common among the students most likely to benefit from postsecondary career and technology education.

Steps Texas Should Take

This report includes several recommendations to help overcome these challenges.

1. Make more parents and students aware of all postsecondary educational options, including career and technical education (CTE), and the availability of financial assistance.
2. As part of this effort, use data on educational and employment outcomes to quantify the economic benefits of CTE, and publicize these results to help make current and prospective students aware of its value and promise.
3. Ensure that state academic requirements, such as those represented by the new “four-by-four” policy and new GPA calculation standards, do not prevent or discourage students from enrolling in career and technology courses.
4. Establish a $25 million Jobs and Education for Texans (JET) fund to provide support for postsecondary CTE courses, including startup funding for new programs.
5. Link any incentive funding for postsecondary technical education to measures that help ensure the state receives a positive return on its investment.

Endnotes

---