Higher Education in New Hampshire and the Economy

Ross Gittell

James R. Carter Professor Whittemore School of Business and Economics University of New Hampshire

Topics



High education, per capita income and high technology …”The New Hampshire Way”



Supply of and demand for the college educated in New Hampshire



The economic argument for investment in higher education in New Hampshire



Looking Forward

Over the last decade NH ranks 11 th of 50 states and 1 st Northeast in employment growth. NH has the 6 th in highest per capita income in the US

(2003) ..income rank improved from 25 th three decades ago

Region US New England NH ME VT RI MA CT Leading State Bottom State Employment Change 1990-2003 16.8% 12.4% 22.7% 16.7% 16.0% 12.5% 12.2% 7.3% 61.9% Nevada 5.3% Hawaii Rank 11 25 27 37 38 49 Per Capita Income 2003 31,632 38,171 34,702 28,831 30,740 31,916 39,815 43,173 43,173 Conn 23,448 Mississippi Rank 6 34 22 17 3 1

New Hampshire’s Strong Economic Recovery From Early 2000s Recession



Total Employment NH …Jan04-Jan05

  Total employment grew 2.9% compared to US average of 1.6% (NH ranked 8 th highest)

Other fast growing states are Nevada, Arizona and Florida which have much lower per capita income

Services employment grew 5% compared to US average of 1.7% (ranked 8 th ) 

High Tech Employment in NH ..June 03 to June 04

   7.8% growth, NH ranked 4 highest big turnaround from “tech bust” decline of more than 1/3 rd and ranked 50 th .. NH reliant economy ..shift within high tech to growth sectors from commodity manufacturing… growth in engineering and life sciences R&D, engineering services and testing labs and cable and other program distribution

The Education Advantage: Educational Attainment and High Technology Employment Concentration 8%

Percentage Of Population (25+) With Bachelors Degree 2000 vs. High Tech Employment Concentration

14%

US Avg (15.2% , 6.12% )

12% 10%

VA NH MA CO MD

10% 12% 8% 14% 6% 4% 16% 2% 18% 20% 22% 0%

Percent w/ BA

24%

Educational Attainment (% of adults with a 4-year college degree) has a strong positive correlation with per capita income across the 50 states. NH is in the top tier…

Per Capita Income correlated to Percent of Adults population with Bachelors Degree median lines denote US av erage (15.5%, $29,847) 45000 CT NJ 40000 MA MD CO 35000 NH 21% 5% 7% 9% 11% 13% 30000 15% 17% 19% 23% 25000 20000 Percent with bachelors degree

10 NH Counties Correlation: Higher Education and Income

10% Percentage of Population Over 25 w/ Bachelor Degree or Higher vs. Per Capita Income (2000) 40000

Hillsborough (31.7%, $38483)

15%

NH (28.6%, $33398)

35000

Rockingham (30.1%, $36016)

20%

Belknap (23.3%, $30082)

25%

Carroll (26.5%, $30423)

30000 30%

Grafton (32.7%, $31338)

35%

Merrimack (29.1%, 30907) Cheshire (26.6%, $28217)

Sullivan (19.7%, $27671)

Strafford (26.4%, $27140)

25000

Coos (11.9%, $25242)

20000 % With Bachelors Degree

The Supply Side of College Educated Labor in New Hampshire

Bachelor's Degree or Higher Educational Attainment, Population 25 and Older State Massachusetts Connecticut Vermont New Hampshire Rhode Island Maine 1980 7 4 12 14 27 37 Rank 1990 3 2 8 9 19 28 2000 2 5 7 9 18 27 Percent of the Population 1980 20.0

20.8

18.7

18.1

15.6

14.0

1990 27.2

27.2

24.4

24.2

21.1

18.5

2000 33.1

31.2

29.7

28.6

25.7

23.3

U.S.

16.2

20.3

24.4

Source: 1980, 1990, and 2000 5% Census PUMS Notes: In each year, the District of Columbia ranked first. Other high-ranking states in 2000 were (3) Colorado, (4) Maryland, (6) New Jersey, (8) Virginia, and (10) Washington.

NH “Imported” in a High Tech/High Per Capita Income Economy NH attracting skilled workers and entrepreneurs for many reasons

(3 of 4 adults with Bachelors+ were born in another state)

   Unique Quality and Character of Life    Mountains and Seacoast Strong Communities (social capital) New England History and Character Ranked First in Nation  Favorable Tax Climate (as percent of income)  Safest State (crimes per capita)  Lowest Poverty Rate Ranked Among Top 3 in US  Child and Family Well Being (Casey, 2003)   Healthiest State (Morgan Quitno, 2003) Most Livable State (Morgan Quitno, 2003)

BUT …State-wide New Hampshire Domestic In-Migration is Slowing

  In-migration increased at annual rate of 17%, 1991-96 Grew at 4% rate in late 1990s   Expected to decline 5% per year 2001-2006 (New England Economic Project) There are recognized concerns about too much growth and the effect of significant in-migration on sprawl and the character/culture of New Hampshire  There is an economic need and social value in focusing on educating “our own.”

Who will work in high tech industries in the future? Age distribution of BA/BS holders in NH compared to other NE states and US… o lder workers near retirement more likely to have college degree than entry level aged 0.50

0.45

Proportion of Residents with a BA/BS or More, By Age, New England States and the U.S.

0.40

0.35

0.30

0.25

0.20

0.15

0.10

0.05

0.00

25 27 29 31 33 35 37 39 MA 41 43 45 47

Age of Resident

49 NH VT 51 US 53 55 57 59 61 63 65

20% 10% 0% -10% 60% 50% 40% 30%

Big decline in percent change in 46-64 as baby boomer generation ages in NH and US and retires

Age 45-64 Population Change Over Selected Time Periods 14.7% 4.4% 1980-1990 36.6% 50.1% 1990-2000 28.7% 40.2% 2000-2010 3.8% -2.1% 2010-2034 United States New Hampshire

The Demand-Side: Higher Education and the economy



Nearly 2 of every 3 new jobs in US and NH will require some college education



While less than 1 of 3 adults currently have college degree in NH

“Even in Coos County”….“BA+” Occupational Employment 2000 to 2010 demand is significant

Coos County Occupations

Registered Nurses General and Operations Managers Postsecondary Teachers, All Other Counselors, Social, and Religious Business Operations Specialists, All Other Network and Computer Systems Accountants and Auditors Financial Managers Recreation Workers Educational, Vocational, and School Chief Executives Medical and Health Services Managers Instructional Coordinators Financial Specialists, All Other Pharmacists Computer Science Teachers, Business Teachers, Postsecondary Insurance Sales Agents Loan Officers Industrial Production Managers

Totals: County Jobs 2000

271 245 101 98 109 41 75 72 63 41 49 33 33 31 32 29 29 28 28 29

1437 County Jobs 2010

334 277 117 124 116 64 81 80 69 47 55 43 38 36 36 34 34 25 25 26

1661 Growth Rate

23% 13% 16% 27% 6% 56% 8% 11% 10% 15% 12% 30% 15% 16% 13% 17% 17% -11% -11% -10%

15.59% Growth Rate State

30% 16% 32% 28% 19% 73% 20% 19% 19% 31% 19% 39% 33% 32% 29% 32% 32% 7% 5% 1%

22.49% Growth: County/

77% 81% 49% 95% 34% 77% 39% 58% 50% 47% 64% 79% 46% 51% 44% 53% 54% na na na

69.30% Openings per year

15 11 5 6 4 4 3 3 3 2 2 2 2 2 1 1 1 1 1 1

70

Demand-Side Model: Assumptions

(all can be varied)

 Average tenure in occupation is 20 or 25 years (or 5 or 4 percent turnover per annum)  One-third of all Bachelors requiring jobs in NH will be filled by people with out of state degrees  In-state degree graduates staying to work in state public (70% or 60%) and private (40% and 30%)  High Demand assumes high turnover and low in state-retention. Low Demand assumes low turnover and high retention. “Mean” demand is the average of High and Low.

NH Occupations requiring a Bachelors

Statewide NH Occupational Cluster Totals

Totals Business Education information Sciences Health Services Engineering, Math, Physical Sciences Social, Community, Arts Agriculture

annual turnover rate

2000 2010 120,762 151,535 48,197 24,347 11,228 58,353 29,981 18,938 15,782 13,906 7,217 85 20,523 14,810 8,851 79 Annual Annual Filled By Openings Openings out of state 9,112 3,425 1,781 1,332 7,905 2,943 1,537 1,220 33% 33% 33% 33% 1,263 786 524 4

0.05

1,105 647 452 3

0.04

33% 33% 33% 33% Filled in Filled in State State 5,296 1,972 1,030 817 6,105 2,295 1,193 893 741 433 303 2

0.04

846 526 351 2

0.05

Business and Related Occupations

Occupations (sort high to low on change between 2000 to 2010) BU SIN ESS REL AT ED OCCU P AT ION AL CL U ST ER Business Operations Specialists, All Other Securities/Commodities/Financial Svcs Sales Agents Accountants and Auditors Financial Specialists, All Other Property/Real Estate/Community Assoc Managers Personal Financial Advisors Training and Development Specialists Employment, Recruitment, and Placement Specialists Cost Estimators Market Research Analysts Financial Analysts Insurance Sales Agents Tax Examiners, Collectors, and Revenue Agents Probation Officers/Correctional Specialists Purchasing Agents, Ex Wholesale/Retail/Farm Prod Loan Officers Credit Analysts Compensation, Benefits, Job Analysis Specialists Loan Counselors Wholesale and Retail Buyers, Except Farm Products Budget Analysts Survey Researchers Financial Examiners Economists Legal Support Workers, All Other Requir es Som e Sk ill beyond Bac helor ' s General and Operations Managers Management Analysts Financial Managers Chief Executives Sales Managers Marketing Managers Administrative Services Managers Advertising and Promotions Managers Human Resources Managers Purchasing Managers Subtotal

State-w ide Jobs 2000

4,361 2,202 3,313 1,194 928 373 1,053 676 766 461 440 1,668 455 220 1,198 931 224 199 103 672 131 32 105 35 115 11,776 2,693 3,321 2,514 1,639 1,241 1,174 433 964 587 48, 197

Forcasted State-Wide Jobs 2010

5,187 2,973 3,989 1,573 1,135 542 1,215 809 892 580 554 1,781 519 278 1,256 977 256 226 123 691 149 45 113 40 102 13,684 4,443 3,952 2,993 2,064 1,547 1,442 574 1,070 579 58, 353

Education

Occupations (sort high to low on change between 2000 to 2010) EDUCATION OCCUPATIONAL CLUSTER Elementary School Teachers, Ex Special Ed Secondary School Teachers, Ex Special Ed/Voc Ed Primary, Secondary, and Adult Teachers, All Other Middle School Teachers, Ex Special Ed/Voc Ed Preschool Teachers, Except Special Education Special Ed Teachers, Presch/Kindergarten/Elem Sch Special Education Teachers, Middle School Special Education Teachers, Secondary School Kindergarten Teachers, Except Special Education Education, Training and Library Workers, All Other Graduate Teaching Assistants Vocational Education Teachers, Secondary School Adult Literacy/Remedial/GED Teachers & Instructors Vocational Education Teachers, Middle School Requires Some Skill beyond Bachelor's Education Administrators, Elementary/Secondary Education Administrators, Postsecondary Education Administrators, Preschool/Child Care Prg Subtotal

State-wide Jobs 2000

5,789 3,983 2,776 3,616 2,691 882 535 460 537 505 297 326 90 76 1,003 537 244 24,347

Forcasted State-Wide Jobs 2010

6,985 5,042 3,582 4,231 3,115 1,283 710 610 667 619 393 393 118 92 1,189 637 315 29,981

Health and related occupations

Occupations (sort high to low on change between 2000 to 2010) HEALTH SERVICES AND RELATED OCCUPATIONAL CLUSTER Registered Nurses Counselors, Social, and Religious Workers, AO Occupational Therapists Medical and Public Health Social Workers Physician Assistants Child, Family, and School Social Workers Medical and Clinical Laboratory Technologists Dietitians and Nutritionists Occupational Health/Safety Specialists and Techs Recreational Therapists Orthotists and Prosthetists Health/Safety Engineers, Ex Mine Safety Eng/Insp Farm and Home Management Advisors ( Health bio Ag) Athletic Trainers Requires Some Skill beyond Bachelor's Medical and Health Services Managers Subtotal

State-wide Jobs 2000 Forcasted State-Wide Jobs 2010

11,443 1,010 564 557 274 537 538 222 189 192 57 89 58 52 1,077 15,782 14,902 1,291 781 770 440 696 656 269 225 205 69 98 63 58 1,492 20,523

Information occupations

Occupations (sort high to low on change between 2000 to 2010) INFORMATION SCIENCES OCCUPATIONAL CLUSTER Computer Software Engineers, Applications Computer Systems Analysts Computer Software Engineers, Systems Software Network and Computer Systems Administrators Network Systems and Data Communications Analysts Database Administrators Computer Programmers Computer Hardware Engineers Requires Some Skill beyond Bachelor's Computer and Information Systems Managers Subtotal

State-wide Jobs 2000

3,823 1,701 937 940 596 294 1,159 407 1,371 11,228

Forcasted State-Wide Jobs 2010

7,684 2,645 1,710 1,624 1,121 472 1,303 432 1,947 18,938

Engineering occupations

Occupations (sort high to low on change between 2000 to 2010) EN GIN EERIN G/ P H YSICAL SCIEN CES/ MAT H Construction Managers Civil Engineers Mechanical Engineers Environmental Engineers Environmental Scientists/Specialists, Incl Health Technical Writers Insurance Underwriters move tro Math Chemists Sales Engineers Electronics Engineers, Except Computer Physical Scientists, All Other Life Scientists, All Other Surveyors Industrial Production Managers Hydrologists Biomedical Engineers Conservation Scientists Geoscientists, Except Hydrologists and Geographers Airline Pilots, Copilots, and Flight Engineers Chemical Engineers Foresters Materials Engineers Industrial Engineers Electrical Engineers Engineers, All Other Requir es Som e Sk ill beyond Bac helor ' s Engineering Managers Natural Sciences Managers Actuaries Subtotal

State-wide Jobs 2000

1,067 805 1,421 188 256 283 426 194 506 593 215 156 246 1,599 66 56 46 36 99 65 80 302 849 998 1,784 1,433 106 31 13, 906

Forcasted State-Wide Jobs 2010

1,311 895 1,509 261 321 346 475 239 545 627 249 187 272 1,622 88 77 57 43 101 65 79 287 831 970 1,716 1,484 119 34 14, 810

Social, Community & Arts Occupations

Occupations (sort high to low on change between 2000 to 2010) SOCIAL/CULTURAL/ARTS/RECREATION Recreation Workers Graphic Designers Public Relations Specialists Social and Community Service Managers Editors Writers and Authors Architects, Except Landscape and Naval Legal and Related Workers, All Other Art and Design Workers, All Other Commercial and Industrial Designers Multi-Media Artists and Animators Landscape Architects Meeting and Convention Planners Interior Designers Cartographers and Photogrammetrists Architects/Surveyors/Cartographers, All Other Film and Video Editors Fashion Designers Requires Some Skill beyond Bachelor's Public Relations Managers Legislators Producers and Directors Art Directors Admin Law Judges/Adjudicators/Hearing Officers Subtotal

State-wide Jobs 2000

1,093 821 432 607 491 410 402 200 722 231 125 113 73 105 40 27 26 33 347 410 194 222 93 7,217

Forcasted State-Wide Jobs 2010

1,303 1,023 591 756 595 514 492 287 797 268 158 137 90 117 51 38 36 37 471 488 247 260 95 8,851

“Crosswalk” assumptions..

Filling Occupations (rows) x Degree (cols)

Business Engineering, Math, Physical Sciences Social, Community, Arts Information Health Services Education Agriculture Business

50% 10%

Soc&Beh Engineer Science PhySciMath

30% 100% 25%

Health

10% 5% 80%

Education Liberal Arts Information Agricullture

20% 70% 75% 25%

90% 10% 100%

Degree areas in NH projections. Biggest percent gaps in Information sciences, Education, Health and Engineering/Sciences and Math –

all need a 50 percent or higher increase in degrees

Gap Analysis 2002 to 2010 Needed Change 2002 to 2010

Grand Total All Bachelor Degrees Information Sciences Education Health/Biological Sciences Engineering/Physical Sciences and Math Business and Business Management Social Sciences Liberal/Creative Arts Agriculture

Filled by Percent Change Needed Public Mean High Low

1134 391 28% 183% 37% 197% 18% 169% 378 268 132 126 44 7 -38 85% 63% 53% 22% 6% 1% -22% 100% 76% 68% 31% 15% 8% -15% 70% 51% 39% 13% -2% -7% -29%

Current Percent Degree Number Gap Level Public Mean High

7947 340 50.9% 62.9% 2226 622 2916 669 536 674 456 1695 1541 2476 229 83.0% 62.9% 54.4% 34.0% 44.6% 59.3% 74.7% 456 427 243 369 98 12 -51 538 509 309 522 226 143 -35

Low

1537 575 373 344 176 217 -30 -118 -67

The Economic Case for investment in higher education

Public $ Returns on Investment in Higher Education in NH

Income and Multiplier Effects of BA in New Hampshire Population 24 years and over BA High School Difference Annual Income Difference Over Lifetime (35 years) Difference Over Lifetime + Mutliplier Effect in Economy

Source: PUMS 5% Census 2000

Ave. Annual Income Female $34,570 Male $63,191 $22,238 $12,332 $431,620 $863,240 $37,911 $25,280 $884,800 $1,769,600

Traditional Aged Students With Limited Access to Higher Education in NH Counties.. the data contrasts with aspirations of surveyed NH HS seniors.. 67% of females and 55% of males to 4-year college

NH High School to College

2002 (latest year) County Coos Belknap Strafford Merrimack Sullivan Cheshire Grafton Hillsborough Rockingham Carroll

NH TOTAL

HS Graduates 377 566 964 1,138 366 707 929 3,903 2,927 408

12,285

HS Grads to College 156 250 429 563 185 365 496 2,219 1,680 239

6,582

Pct going to 4-yr College 41% 44% 45% 49% 51% 52% 53% 57% 57% 59%

54%

Additions if at state average 48 56 92 52 13 17 6

281

Economic Opportunity ..reduce the loss from low HS matriculation to 4-year college in some counties

  Each HS Graduating Class “shortcoming” in graduates going to college results in loss of $10 million dollars a year in the state With multiplier effects in economy …each (20 year) generation loss from low matriculation to 4 year colleges is about $.5B or 1 percent of the state’s overall economy

Looking Forward…

“other” areas to focus efforts

Non-Traditional Students



165,000 adults report their highest level of education as

some college

 50,000 (or 30% in survey) indicated that they expect to obtain a college degree in next five years

Female under-representation in tech-fields

… a problem and an opportunity in NH

% Female FY-2000

Field

NH

Health Professions Education Biological Sciences Total --All Degrees 93.5% 72.8% 60.5% 57.1% Business Management 47.8% Social Sciences 46.6%

Mathematics

Physical Sciences

39.7%

32.1%

Information Sciences 21.7%

Engineering & Related 19.4%

MA

83.2% 83.5% 61.7% 56.5% 47.7% 52.9%

43.8%

46.6%

24.4% 24.7% ME

86.0% 72.2% 56.2% 59.5% 55.1% 48.9%

50.9%

44.3%

19.2%

11.1%

CO

89.0% 65.0% 61.0% 53.7% 46.9% 54.3%

39.4%

39.5%

25.6%

17.0%

CT

80.7% 65.5% 59.0% 56.3% 47.6% 48.2%

47.4%

43.1%

25.7%

16.5%

4-State Ave.

84.7% 71.6% 59.5% 56.5% 49.3% 51.1%

45.4%

43.4%

23.7%

17.3%

20000

Graduate Education matters…NH at “bottom” of “elite” states with high per capita income and high % adults with graduate degrees

Per Capita Income vs Percent of Population With Graduate Degree 2000 Median Lines Denote US Avg ($29845 , 1.8%) 10% 8%

VA (31087, 8.1%) MD (34257, 8.6%) NY (34897, 8.0%) CO (33370, 7.8%)

NH (33396, 7.1%)

MA (37756, 9.3%) CT (41489, 9.3%) NJ (38365, 7.3%)

6% 4% 25000 2% 30000 0% Per Capita Income 35000 40000

WSBE Freshman Profile: Exploring the “Brain Drain”

Introduction to Business Classes at UNH

2003-2004

Survey Respondents

85 percent of all students in the course

Semester Spring 2003 Fall 2003 Spring 2004 Fall 2004 Total All Semesters Survey Respondents 94 439 102 519 1154

40 35 30 25 20 15 10 5 0

Equal percentages have none, one and two parents who are college graduates

34.5

Number of Parents Who Graduated From College 32.8

32.4

Both One Neither

30 20 10 0 60 50 40

Forty percent were born in New Hampshire

Born in New Hampshire 57.9

41.3

Yes No

60 50 40 30 20 10 0

54 percent graduated from NH High School

(1 of 7 moved into the state during their childhood)

54.1

Graduated from New Hampshire High School 45.2

Yes No

3/4ths said they are likely to go on to graduate school

25 20 15 10 5 0 45 40 35 30 39.1

Highly Likely Likelihood of Going to Graduate School 32.3

21.6

Likely Somewhat Likely 6.4

Not Likely

30 20 10 0 70 60 50 40

Only about 1/3 rd said they are likely to work in NH after graduation.. Compared to just less than 50 percent of NH High School senior students surveyed

Likelihood of Working in New Hampshire After Graduation 68.4

30.8

Yes No

Work in NH after graduation and WSBE Option Preference: Accounting students most likely to stay in state (46%), International Business students least likely (13%)

Work In NH By Intended WHSBE Option Work in NH Work Outside NH 100 90 80 30 20 10 0 70 60 50 40 23.7

75.2

Marketing 30.9

69.1

Management 30.0

70.0

Finance 46.4

52.9

33.3

65.6

12.5

87.5

Accounting Ent Ventures Int Bus/Econ 40.0

60.0

Info Sys

Where do students plan to work after 10 ten years of employment?

Most (1/3rd) expect to work in MA followed by NH (22%). Over ½ plan to work in New England, 1/10 th in NY followed by California. Less than 4 percent expect to work abroad.

Most Likley State of Employment 10 Years After Graduation 35 30 25 20 15 10 5 0 31.8

MA 21.9

NH 17.1

US Other 11.5

NY 7.0

CA 3.9

3.6

Foreign ME || VT 2.9

FL || GA

Looking Forward..

The future of the NH economy depends on investment and attainment in education The state can no longer rely on in-migrants to support a high tech, high income economy Significant “returns” can come with: -- increasing matriculation rates of traditional students -- programs to improve access and delivery to non traditional students -- science, math and engineering and related degrees and increasing female representation in these fields -- increasing graduate education -- retaining more students who go to school in state to work in the economy