Joe Cortright Talent Dividend Metrics

Talent Dividend Metrics A Progress Report Joe Cortright April 2010 Working Draft / Subject to Revision / April 2010

Roadmap 1. The Talent Dividend Calculation 2. Four Key Metrics 3. Years of Post Secondary Education 4. Dynamics: Migration, Retirement 5. Next Steps Working Draft / Subject to Revision / April 2010

Working Draft / Subject to Revision / April 2010

Talent Working Draft / Subject to Revision / April 2010

The Hypothesis • Better educated metropolitan areas have higher incomes • Better skilled workers are more innovative and productive Working Draft / Subject to Revision / April 2010

0% 10% 20% 30% 40% 50% Washington-Arlington-Alexandria, DC-VA-MD-WV San Jose-Sunnyvale-Santa Clara, CA San Francisco-Oakland-Fremont, CA Boston-Cambridge-Quincy, MA-NH Raleigh-Cary, NC Austin-Round Rock, TX Minneapolis-St. Paul-Bloomington, MN-WI Seattle-Tacoma-Bellevue, WA Denver-Aurora, CO New York-Northern New Jersey-Long Island, NY- Baltimore-Tow son, MD Atlanta-Sandy Springs-Marietta, GA San Diego-Carlsbad-San Marcos, CA Portland-Vancouver-Beaverton, OR-WA Hartford-West Hartford-East Hartford, CT Chicago-Naperville-Joliet, IL-IN-WI Columbus, OH Kansas City, MO-KS Philadelphia-Camden-Wilmington, PA-NJ-DE-MD Charlotte-Gastonia-Concord, NC-SC Richmond, VA Rochester, NY Salt Lake City, UT Sacramento-Arden-Arcade-Roseville, CA Indianapolis-Carmel, IN Dallas-Fort Worth-Arlington, TX Milw aukee-Waukesha-West Allis, WI Los Angeles-Long Beach-Santa Ana, CA St. Louis, MO-IL Nashville-Davidson-Murfreesboro-Franklin, TN Miami-Fort Lauderdale-Pompano Beach, FL Orlando-Kissimmee, FL Providence-New Bedford-Fall River, RI-MA Houston-Sugar Land-Baytow n, TX Phoenix-Mesa-Scottsdale, AZ Pittsburgh, PA Cincinnati-Middletow n, OH-KY-IN Virginia Beach-Norfolk-New port New s, VA-NC Four Year College Detroit-Warren-Livonia, MI Buffalo-Niagara Falls, NY Oklahoma City, OK Birmingham-Hoover, AL Attainment Rate Cleveland-Elyria-Mentor, OH New Orleans-Metairie-Kenner, LA Jacksonville, FL Tampa-St. Petersburg-Clearw ater, FL San Antonio, TX Memphis, TN-MS-AR Louisville-Jefferson County, KY-IN Las Vegas-Paradise, NV Working DraftRiverside-San Bernardino-Ontario, CA / Subject to Revision / April 2010

The Evidence Education Explains Most Differences in Metro Income Annual Per Capita Income, 2005 NY $50,000 $48,000 SEA $46,000 HAR DEN MIN PHI $44,000 HOU BAL SAN y = 763.27x + 16466 CHI R2 = 0.5846 $42,000 MIA NO DAL LA MIL $40,000 PIT LV DET RIC CHA NASIND STL BIR PRI SAC KC JAC CLE $38,000 CIN POR RAL LOU ROC COL ATL AUS MEMTPA OKC $36,000 VB SLC PHO BUF $34,000 SAT ORL $32,000 $30,000 15 20 25 30 35 40 45 Percent of Population with a 4-Year College Degree, 2006 Working Draft / Subject to Revision / April 2010 Sources: BEA (Income), Census (Education)

Estimating the Gain • Each 1% improvement in college attainment is associated with a $763 increase in per capita income for the entire metropolitan area • These education gains are the product of a shift in the entire skill distribution, not just moving 1% past the 4 year mark Working Draft / Subject to Revision / April 2010

Make progress at every stage Working Draft / Subject to Revision / April 2010

Additional Evidence for the Talent Dividend • President’s Council of Economic Advisors • Unemployment Rate Differential in the Great Recession Working Draft / Subject to Revision / April 2010

Educational Gains Stagnating For decades, the number of educated American workers grew faster than did the demand for them. But beginning with the cohort that completed its schooling in the early 1970s, the growth rate in the supply of educated Americans slowed significantly. Working Draft / Subject to Revision / April 2010

Least well educated metros have highest unemployment rates Working Draft / Subject to Revision / April 2010

“Social Returns” to Education Ed Glaeser: Well-educated metro’s had lower unemployment rates than explained by individual educational attainment. Poorly educated metros had unemployment rates 1.8 times higher than explained by individual levels of education. Working Draft / Subject to Revision / April 2010

2. Metrics for improving attainment • High School Completion • College Continuation • Adult Post-Secondary Education • College Completion Working Draft / Subject to Revision / April 2010

Different Sources of Data – Institutional • Enrollment records • Generated by schools • Aggregated by others (NCES, NCHEMS, NSC) – Population • Survey data • Gathered by Census Bureau • Covers entire population; sampling variability Working Draft / Subject to Revision / April 2010

Institutional Measures • Administrative records from educational institutions – Diplomas, Enrollment • Reported to and aggregated by national organizations – NCES, National Student Clearinghouse • High coverage/ Can drill down; but can be vague and anomalous Working Draft / Subject to Revision / April 2010

High School Completion • Cumulative Promotion Index • Product of high school grade level success rates: – [(9th to 10th %) x (10th to 11th %) x (11th to 12th) % x (12th to Diploma %)] • If 90% are promoted each year – CPI= .9 x .9 x .9 x .9 = 65.1% • Computed from NCES data Working Draft / Subject to Revision / April 2010

High School Graduation Rates (CPI Method) WAS CIN PDX DET SAC IND NY BAL PHI MEM RIC KC VBN RAL ROC HOU RIV DEN NAS ATL OKC LOU MIL SLC AUS STL SDO JFL BIR CLE SEA TSP LA SJO DFW CHI MSP PHX LV MIA CHA ORL COL SAT SFO BUF 35% 40% 45% 50% 55% 60% 65% 70% 75% 80% 85% Source: Computed from NCES/CCD Working Draft / Subject to Revision / April 2010

College Completion • Institutions report 6-year graduation rate for four-year institutions • Data reported by institutions, tabulated by IPEDS • We sum by metro area, weighting institutional rates by enrollment for four- year institutions. Working Draft / Subject to Revision / April 2010

College Graduation Rates SDO COL LA SEA RIC SAC STL ORL ATL CLE ROC JFL BUF AUS TSP NAS BOS MIA VBN BAL PDX RIV PHI OKC CIN HAR DFW NY RAL DET NOLA CHA PIT SLC IND BIR PRO MEM LOU MIL SFO LV KC CHI SAT PHX HOU DEN WAS MSP SJO 10% 20% 30% 40% 50% 60% 70% Source: Computed from IPEDS Working Draft / Subject to Revision / April 2010

National Student Clearinghouse Working Draft / Subject to Revision / April 2010

Population Measures • Data from American Community Survey • Two Questions: – Attendance – Attainment • Asked of 1% Sample Annually • Use 3-year 2006-2008 pooled sample Working Draft / Subject to Revision / April 2010

MicroData Tabulations Working Draft / Subject to Revision / April 2010

ACS Attendance Question Working Draft / Subject to Revision / April 2010

The ACS Attainment Question Working Draft / Subject to Revision / April 2010

High School Completion (on time) • What percent of 19 year olds report having received a high school diploma or GED? • Census question makes no distinction between diploma and GED Working Draft / Subject to Revision / April 2010

College Continuation • What proportion of 18 to 24 year olds who have completed high school are enrolled in college? Working Draft / Subject to Revision / April 2010

College Enrollment Percent of 18-24 Year Olds Attending Post-Secondary Education SAT PDX CHA HOU MEM LA SJO TSP CIN ROC SEA CLE NAS BUF SLC SDO WAS PIT IND BAL MIL PRO DFW RIC STL HAR LOU SAC OKC COL KC BIR MIA AUS PHX ORL DET PHI JFL VBN NOLA CHI SFO RAL LV DEN RIV ATL MSP NY BOS 25% 30% 35% 40% 45% 50% 55% Source: American Community Survey, PUMS, 2006-2008 Working Draft / Subject to Revision / April 2010

Adult Post-Secondary Education • What proportion of 25-44 year olds, who have completed high school, but do not have a bachelor’s degree, attended college classes? Working Draft / Subject to Revision / April 2010

Adult Enrollment and Age Enrollment Declines with Age Percent of Persons with Less than a BA Degree Attending College Classes, by Age 18.0% 16.0% 14.0% Attending College Classes 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 2 R = 0.983 0.0% 20 25 30 35 40 45 50 55 60 65 70 Age Source: American Community Survey, PUMS, 2006-2008 Working Draft / Subject to Revision / April 2010

Adult Post-Secondary Attendance 25 to 44 Year Olds with No Four-Year Degree Attending Post-Secondary Classes RIC KC LA PRO TSP PHX RAL PIT RIV MIL LOU ORL ROC BOS CHI SEA PDX NY PHI HOU COL MIA SAT SJO DFW NAS ATL AUS HAR CLE WAS OKC NOLA CHA CIN MSP STL JFL BAL SLC VBN LV BIR BUF DEN IND MEM DET SFO SDO SAC 5.0% 5.5% 6.0% 6.5% 7.0% 7.5% 8.0% 8.5% 9.0% 9.5% Source: American Community Survey, PUMS, 2006-2008 Working Draft / Subject to Revision / April 2010

College Completion • What percent of 24 year olds report having received a four-year college degree? Working Draft / Subject to Revision / April 2010

College Completion 24 Year Olds with a Four-year degree or higher CHA BOS ROC IND OKC BAL DEN ATL PRO SEA CLE CHI SDO CIN MIL DFW PDX HAR BUF DET RIC BIR MSP SAC TSP ORL NAS NY LV PHX LA STL COL SAT NOLA MEM SJO PHI SLC HOU MIA SFO PIT RIV VBN JFL LOU AUS KC WAS RAL 10% 15% 20% 25% 30% 35% 40% 45% Source: American Community Survey, PUMS, 2006-2008 Working Draft / Subject to Revision / April 2010

Making Use of the Data • Where am is my region strong and weak? • Who is doing better that I might learn from? • Are there special conditions that affect local performance? Working Draft / Subject to Revision / April 2010

Years of Post-Secondary Education • Four-year degree attainment rate is too simple to capture the “size” of the Talent Dividend challenge • How much additional education is needed to raise the attanment rate? Working Draft / Subject to Revision / April 2010

YPSE Weights Value Years of PSE High school graduate, or Less 0 Some college, less than 1 year .5 One or more years of college but no degree 1.2 Associate degree 2 Bachelor's degree 4 Master's degree 5 Professional degree 5 Doctorate degree 7 Working Draft / Subject to Revision / April 2010

YPSE v. 4 year attainment Years of Post-Secondary Education Correlates with BA Attainment y = 0.2097x - 0.0634 2 R = 0.9763 60.0% 50.0% 40.0% BA Attainment Rate 30.0% 20.0% 10.0% 0.0% 0 0.5 1 1.5 2 2.5 3 3.5 YPSE: Years of Post-Secondary Education Source: American Community Survey, PUMS, 2006-2008 Working Draft / Subject to Revision / April 2010

How much effort? • Years of Post-Secondary Education • Portland: About 100,000 person years of additional post-secondary education to raise the four-year college attainment rate by 1 percentage point. Working Draft / Subject to Revision / April 2010

Adding Dynamics • Our talent measures are “snapshots” • We need to account for movement in and out of the working population • Movement in time: Retirements • Movement in space: Migration Working Draft / Subject to Revision / April 2010

Dynamics • Migration – Workers are constantly moving in and out of every metropolitan area • Retirement – Young people are entering the labor force – Older workers are reaching retirement age Working Draft / Subject to Revision / April 2010

Migration • About 2.7 million working age persons with four-year degrees move to a different metropolitan area each year Working Draft / Subject to Revision / April 2010

Talent Migration * Net In-Migration of Working Aged Adults with a Four-year Degree PHI CHI JFL MIL BAL LOU SLC PRO CIN VBN DFW TSP NY BUF SFO PIT PDX HAR IND WAS ATL PHX ROC BOS NAS SDO SAT RAL MEM ORL COL SJO HOU CHA LV NOLA DET LA MSP KC RIC SAC RIV SEA AUS -1% -0.5% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.5% * Not adjusted for international out-migration Source: American Community Survey, PUMS, 2006-2008 Working Draft / Subject to Revision / April 2010

Retirement: Boomer Talent Exodus Number of College Educated Leaving Will More than Double 1,400,000 1,200,000 College Educated Persons Turning 65 1,000,000 800,000 600,000 400,000 200,000 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Year Working Draft / Subject to Revision / April 2010

Retirement Rate Rising Everywhere ATL AUS CHA RAL IND COL MSP MIL DFW MEM NAS BOS Next Five Years KC CHI DEN Last Five Years DET SEA PRO BIR PDX SJO HOU CIN NY PHI RIC PIT WAS VBN STL SLC LOU BAL NOL HAR SFO BUF CLE LA Percent of Working Aged Adults with ORL a Four-Year Degree or Higher SDO OKC JFL Reaching Retirement Age SAT SAC RIV ROC PHX MIA TSP LV 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% % BA+ Reaching Retirement Working Draft / Subject to Revision / April 2010 Source: American Community Survey, PUMS, 2006-2008

• Career counseling – getting employers involved in supporting college career paths • Social marketing • How to account for non-traditional, part-time students • Value of liberal arts in synergy with vocational • 2 and 4-year institutions working together; also reconciling data on 2-yr 4-yr grad rates • Long term pipeline balance with short term results of TD • Race and ethnicity; come up with better language • Tension between TD as initiative and goal; define short- term strategies to help get big-wins; speed as theme with prototyping as strategy • Compounding value of doing the 1% • Where are the gaps that business community should take on. Working Draft / Subject to Revision / April 2010

Typical Improvement • Can we move Portland (33.3% college attainment to the same level as • San Diego (34.2%) or Atlanta (34.6%) college attainment? • The Portland Talent Dividend $1.6 Billion Annually Working Draft / Subject to Revision / April 2010

Share of 18 to 24 Year Olds Attending College Percent of 18 to 24 year old residents enrolled in college 0% 10% 20% 30% 40% 50% Raleigh-Durham Portland Las Vegas Working Draft / Subject to Revision / April 2010

Joe Cortright Talent Dividend Metrics

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Joe Cortright Talent Dividend Metrics — Presentation Transcript