Massachusetts Economic Growth and Recovery. Depends on a Strong System of Public Higher Education. April 17, 2002

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1 Massachusetts Economic Growth and Recovery Depends on a Strong System of Public Higher Education April 17, 2002

2 At Issue Education reform has made a difference in Massachusetts. Will the high school graduates of 2003 have access to affordable, quality public higher education?

3 Essential Facts 85% of the jobs in a knowledge-based economy require postsecondary education. Two-thirds of Massachusetts residents attending college in-state are enrolled at public colleges and the University. 75% of public higher education graduates enter the Massachusetts workforce after graduation. Public higher education is the primary postsecondary entry point for minority and low income students. Massachusetts state appropriations for public higher education are not keeping pace with peer states.

4 Public Colleges and the University Enroll the Largest Share of Massachusetts Residents Massachusetts Residents Attending College by Location and Type of College: 1996 Massachusetts Residents Attending College Residents Attending College in Massachusetts 26% Attend Out-of-State Institutions 37% Attend Private Colleges 74% Attend Institutions in Massachusetts 63% Attend Public Higher Education

5 Massachusetts Fastest Growing Public Higher Education System The public sector (2 and 4-year) has grown faster in Massachusetts than in any other state. (The share of total enrollment in Massachusetts Public Higher Education Institutions: up 7.5%.) Figure 5: Change in Public Institutions' Share of Total Freshmen 1992 to 1998 Texas, -0.6 Georgia, -0.8 Alabama, -1.2 Utah, -1.4 Missouri, -1.8 Ohio, -1.8 Pennsylvania, -1.8 Florida, -2.0 Nevada, -2.1 Maine, -2.2 Michigan, -2.3 Maryland, -2.4 Nebraska, -2.6 New York, -3.0 New Jersey, -3.2 Illinois, -3.3 Hawaii, -3.7 Washington, -3.7 California, -5.3 New Mexico, -6.5 Arizona, -6.5 New Hampshire, -6.5 Minnesota, -6.9 Oregon, -7.2 Alaska, -7.4 Delaware, -8.8 Massachusetts, 7.5 Idaho, 6.1 South Dakota, 5.5 North Carolina, 5.2 Vermont, 3.8 South Carolina, 3.4 Mississippi, 2.3 West Virginia, 1.9 Rhode Island, 1.8 Oklahoma, 1.5 Iowa, 1.4 Louisiana, 1.2 North Dakota, 0.8 Montana, 0.8 Indiana, 0.8 Tennesse, 0.8 Wisconsin, 0.8 Wyoming, 0.6 Kansas, 0.6 Connecticut, 0.6 Arkansas, 0.2 Colorado, 0.2 Virginia, 0.1 Kentucky, 0.0 U.S. = (-1.3%) Percent of Total Freshmen Postsecondary Education OPPORTUNITY, (9/01) No. 11.

6 Minorities Fastest Growing Segment of Massachusetts Potential Workforce Figure 9: Massachusetts Potential Labor Force Entrants by Figure 8: MA: P otential Labor Race Force Entrants and Ethnicity by R ace and Ethnicity From: BEYOND 2000: Demographic Change, Education and the Work Force, Nellie Mae Foundation, 1993; available at MISER s web-site: White Black Hispanic Asian

7 Accessibility for Low Income Students at Risk Affordability = Accessibility Adequate financial aid is key to low income student access to postsecondary education state financial aid budget reduced by $10 Million.

8 Massachusetts Public Higher Education Tuition and Fees Consistently Higher than Peers and National Segmental Averages Tuition and Fees 1990 to 2001 $4,500 $4,000 $4,003 $3,500 $3,770 $3,000 $2,500 $2,000 $1,500 $2,052 $1,931 $1,223 $2,153 $1,653 $1,000 $500 $915 $ Massachusetts Tuition and Fees at Public 4-Year Institutions Peer Average Tuition and Fees at Public 4-Year Institutions Massachusetts Tuition and Fees at Public 2-Year Institutions Peer Average Tuition and Fees at Public 2-Year Institutions

9 State Dollars Invested Per Student: Peers Out- Pace Massachusetts State Appropriations Per FTE of Key Peer States* $12,000 $10,000 $8,000 $6,000 $4,000 NC $10,264 CT $8,801 MN $8,255 NJ $7,604 MA $7,437 NY $6,898 MA $7,360 $2,000 $ Connecticut Massachusetts Minnesota New Jersey New York North Carolina Sources: Grapevine, NCES, BHE Fall 01 Early Enrollment Report * Adjusted to represent the relative funding requirements of a state s system of higher education based on geographical cost of living differentials.

10 State Appropriations for Massachusetts Public Higher Education: Not Keeping Pace with Peer States 140% 120% Peer Comparison Cumulative Percent Change in State Appropriations 1988 to 2002 Texas 127% 100% 80% 60% Peer Average 85% 70% Minnesota 40% New York 20% 0% -20% % 13% Massachusetts % Massachusetts* Minnesota New York Texas Peer Average Source: Grapevine Peer States: Arizona, California, Colorado, Connecticut, Florida, Georgia, Illinois, Maryland, Michigan, Minnesota, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Texas, Virginia, Washington

11 Massachusetts Public Higher Education Hit Hard in 2002 Percent Changes in Higher Education State Appropriations Fiscal Year % Average Peer Increase 4.3% 4.0% 14 States 2.0% Average Peer Decrease -4.6% Massachusetts Decrease -6.2% 0.0% -2.0% -4.0% -6.0% -8.0% States at Least Level Funded Arizona California Colorado Connecticut Georgia Illinois Maryland Michigan Minnesota New York Pennsylvania Texas Virginia Washington 3 States States w ith Reduced Funding Florida New Jersey Ohio Source: Grapevine and data collected by BHE from peer states as of 4/15/02

12 Anticipate Harder Hit in 2003 Percent Changes in Higher Education State Appropriations Anticipated Fiscal Year % Average Peer Increase 2.7% 2.0% 12 States Average Peer Decrease -2.0% Massachusetts House 1 Decrease -6.5% 0.0% -2.0% -4.0% -6.0% States at Least Level Funded California Colorado Connecticut Florida Maryland Michigan Minnesota New Jersey New York Ohio Pennsylvania Texas 5 States States w ith Reduced Funding Arizona Georgia Illinois Virginia Washington -8.0% Source: Grapevine and data collected by BHE from peer states as of 4/15/02

13 State Funding Commitment: K-12 and Higher Education Percent of State Annual Budget Appropriations on Mass. Public Education % 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% Source: BHE Fiscal K-12 Public Higher Ed

14 Higher Education = Higher Earnings = Higher Standard of Living and Quality of Life for the Commonwealth s Residents Figure 1: Total Earnings, Average of M a ssa chuse tts $90,000 $80,000 $78,687 $70,000 $60,000 $50,000 $40,000 $30,000 $32,003 $42,614 $53,621 $20,000 $10,000 $- No College Degree Associate Degree Baccalaureate Degree Post-graduate Degree Source: MISER

15 State Appropriations for Higher Education in Massachusetts is Historically Erratic Compared to Peer States 20% Peer Comparison Annual Percent Change in State Appropriations 1998 to % 10% 5% 0% % -10% -15% -20% Source: Grapevine Massachusetts Peer Average

16 State Funding Commitment: K-12 and Higher Education Nationally and in peer states, public education dollars are appropriated at the rate of $2 (K-12) to $1 higher education. In Massachusetts, the rate is $3 to $1. Public higher education systems in peer states receive double the annual percent share of the state budget. 35% 30% 25% 20% Percent of Total State Expenditures on Public Education: Mass., Peer State Avg., and Nat'l Avg (Est.) 5.3% 10.9% 10.8% 15% 10% 15.4% 22.3% 22.6% 5% 0% Source: NASBO Mass. Peer State Avg. National Avg. K-12 Higher Education

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