The Times West Virginian

Business

February 9, 2014

Study shows PROMISE investment valuable for state

FAIRMONT — A new study is part of the process to ensure that West Virginia has a workforce ready to meet the needs of the economy.

The West Virginia University College of Business and Economics’ Bureau of Business and Economic Research (BBER) recently carried out a report commissioned by the West Virginia Higher Education Policy Commission (HEPC). The study, titled “From Higher Education to Work in West Virginia, 2012,” was just released at the end of January.

John Deskins, director of the BBER, explained that the report looks at the employment and incomes of thousands of graduates from public colleges and universities in West Virginia in the past decade.

Using data from the HEPC from 2012, the BBER analyzed how graduates were fairing in the labor market, including whether they were working in the state and what part of the state, as well as their salaries that year, he said.

The outcomes were examined based on a wide number of characteristics, such as the PROMISE scholarship and other tuition assistance, area of concentration and degree earned, academic achievement, and personal characteristics like gender, age and race.

Of those graduates in the last decade, nearly 48 percent were working in the state in 2012. For everyone who had received the merit-based PROMISE scholarship during that time frame, the work participation rate in West Virginia was 60 percent, which shows a pretty sizable increase, Deskins said.

As the HEPC is trying to promote ways to keep graduates in the state to contribute to the economy, this finding could be a significant factor in terms of future policy, he said.

“It was good to see our PROMISE numbers going up in terms of PROMISE graduates who stay in the state after graduation,” said Jessica Tice, senior director of communications for the HEPC.

“When you talk to PROMISE recipients/graduates, not only does PROMISE incentivize them to stay here in West Virginia for their post-secondary studies, but also kind of the idea of the state investing in them really in turn makes them want (to search for jobs in the state).”

She said an especially compelling finding from the report was that 80 percent of PROMISE recipients who graduated in 2003-2004, which was the first group to receive the scholarship, worked in the state in the year 2012. The 2012 workforce participation rates of PROMISE recipients dipped for the graduating classes that followed. The 2010-2011 graduates hovered at around 66 percent.

Additional research would need to take place, but it’s a pretty fair assumption that some of those students could have gone on to graduate school, which would explain why their workforce participation rate didn’t spike early on, Tice said. Those students could have also started a family or experienced other personal circumstances.

In addition, the 2012 workforce participation rate for students who received the need-based Higher Education Grant Program scholarship over the past decade was 65.5 percent, which is even higher than the PROMISE scholarship rate, she said.

Deskins reported that two industries — health care and social assistance, as well as educational services — accounted for the employment of more than half of the graduates from the previous decade who were working in the state in 2012. This shows that these industries are hiring a lot of skilled workers with higher education.

In terms of income outcomes, the average income for those graduates was nearly $42,000 in 2012, he said. The study shows that income rose significantly for those individuals as they moved further and further past their graduation date.

While this result was expected, Deskins said it’s comforting to see people getting higher income as they gain experience and move up the ladder in their careers.

However, he said the work participation rate in the state tends to fall as the time since graduation increases. For instance, overall work participation was nearly 55 percent in 2012 for graduates of 2010-2011, compared to only around 41 percent for 2001-2002 graduates.

Part of this could be because people sometimes become stay-at-home parents a few years after they graduate. But another possibility is that people could become more inclined to leave the state to look for jobs further after graduation, Deskins said.

The HEPC and the BBER have a long-standing relationship of working together on projects. In the coming years, the BBER wants to continue to inform about the best ways to draw highly productive men an women to the state to contribute to the economy, he said.

“I definitely think West Virginia can find ways to improve public policy to attract people to the state,” Deskins said.

Tice said the HEPC knows from a study by Georgetown University's Center on Education and the Workforce that West Virginia needs to produce an additional 20,000 college graduates by 2018 just to sustain the current economy.

“We definitely know that the trend is moving toward the need for some form of education and training beyond high school,” she said. “For the HEPC, we actually just started implementing a new master plan which is focused on access, success and impact.”

Not only do graduates impact the workforce, but they also affect the economy through community involvement, investments and research, Tice said.

The HEPC has a student financial aid advisory board that considers changes for procedures and policies, and uses information from reports like this one to help with its recommendations for the future, said Dr. Angie Bell, vice chancellor for policy and planning.

These type of statistics are used to provide factual information to high school students about the benefits of higher education in West Virginia and data on the outcomes for different majors and program. In addition, the HEPC uses these figures to look at the contribution of graduates to the state’s economy.

“We do look to see where we have challenges in terms of retaining students,” Bell said. “There are certain fields where we see lower retention levels. We think about strategies for how to better retain students in those fields.”

She said it was interesting to see that throughout the recession, an increasing number of students were showing up in the West Virginia workforce. This reinforces the message that, as seen throughout the country, achieving higher education credentials is insurance against economic cycles.

Email Jessica Borders at jborders@timeswv.com or follow her on Twitter @JBordersTWV.

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