Economic Inequality and Higher Education: Access, Persistence, and Success

5. Community Colleges

101 Chapter 5 Community Colleges DAN GOLDHABER AND GRETCHEN K. PERI T HE EVIDENCE that higher education is a key to economic advancement is uncontested. Relative to those who fail to attain a college diploma, graduates of four-year colleges1 tend to be significantly more successful in the labor market. In 2004, for instance, the annual average unemployment rate for persons with a bachelor’s degree or higher was 2.7 percent as compared to 3.7 percent for those with an associate’s degree, 4.5 percent for those with some college but no degree, and 5.0 percent for high school graduates without any college attendance (U.S. Bureau of Labor Statistics 2005).2 In 2003, college graduates with a bachelor’s degree had a median income $14,200higherthannongraduates(seefigure5.1)(TheCollegeBoard2004a).3 There is also evidence that college graduates tend to live healthier, happier lives (Michael 1972; Kenkel 1991; Grossman 1975, 1982; Berger and Leigh 1989; Behrman and Wolfe 1989; The College Board 2004a).4 There is some question as to whether the benefits of college attendance accrue primarily as a consequence of human capital accumulation resulting from college training or from the screening role that colleges play in identifying individuals who are productive (Spence 1973; Dale and Krueger 2002; Becker 1964; Groot and Oosterbeek 1994; Layard and Psacharopoulos 1974). The answer to this question is important in determining the societal benefits associated with college attendance but, regardless of the reasons for the benefits, it is clear that college completion is one of the best ways to ensure economic success. Far less is known about an increasingly important part of the postsecondary schooling world: community colleges. The number of undergraduate students attending any type of college has grown considerably over the last thirty years, but this growth has occurred disproportionately in the community college sector. In 1970, the share of postsecondary undergraduate students enrolled in community colleges was just over 30 percent. In 2003, it had risen to about 45 percent.5 Furthermore, community colleges appear to be particularly important for lower-income and minority 102 Economic Inequality and Higher Education students. In 2002, for example, 43 percent of African American and 58 percent of Hispanic postsecondary students were attending two-year colleges. In the same year, minority students constituted 36 percent of total enrollment at two-year institutions versus about 25 percent at four-year colleges (NCES 2005a). In 2000, low-income students were almost twice as likely as high-income students to spend their first year of undergraduate study at a community college (The College Board 2004a). Does the existence of community colleges lead to reductions in educational inequality that in turn translates into a reduction in society’s economic inequalities? The answer is complicated. It depends both on whether community colleges encourage greater educational attendance and how well community college students fare in the labor market compared with those who graduate from traditional four-year institutions. A fair amount of research covers how community college students compare to four-year college students, but far less on how the existence of community colleges affects the choices of prospective postsecondary students. Here we explore the role of community colleges in postsecondary schooling as it relates to alleviating or exasperating access, persistence and success in higher education, and what this in turn portends for their influence on economic inequalities in society. Trends in (Community) College Attendance Postsecondary college attendance increased significantly after World War II. In the last three decades alone, the percentage of high school graduates attending at least some college has grown from 51 to 64 percent (NCES Figure 5.1 Median Earnings by Education, 2003 $21,600 $30,800 $35,700 $37,600 $49,900 $59,500 $79,400 $95,700 $0 $20,000 $40,000 $60,000 $80,000 $100,000 Less than HS diploma High school diploma Some college, no degree Associate’s degree Bachelor’s degree Master’s degree Doctorate degree Professional degree Source: The College Board (2004a, figure 1). Note: Includes full-time year-round workers aged twenty-five and older. 2005b).6 Enrollment is projected to continue this upward trend through at least 2014. This growth, however, has occurred disproportionately among community colleges (see figure 5.2).7 Much of this increase in attendance has been among low-income students, and it appears that a shift is occurring in the distribution...