This chapter provides an overview of the labour market and higher education system in the state of Ohio, an assessment of the labour market outcomes of graduates, and a discussion of state policies that contribute to aligning higher education and the labour market. The policy discussion focuses on four policy areas – strategic planning and co-ordination of higher education; educational offerings, student supports and pathways; funding; and information – and includes policy recommendations in each area.
Labour Market Relevance and Outcomes of Higher Education in Four US States
Ohio, Texas, Virginia and Washington
Higher Education
4. Ohio
Abstract
4.1. The labour market and higher education in Ohio
The economy and labour market
Ohio’s economy is transforming, but manufacturing remains a vital industry
Ohio is the 7th largest economy in the United States, and the 36th largest economy in the world, with a Gross Domestic Product (GDP) of almost USD 676 billion in 2018 (U.S. Bureau of Economic Analysis (BEA), 2020[1]; Ohio Development Services Agency, 2019[2]). In the context of the wider OECD, Ohio’s productivity is at a similar level to that of Germany and Sweden. However, Ohio lags behind many other parts of the United States on some indicators of productivity. For example, GDP per capita is slightly below the average level of the United States as a whole, and below that of the Great Lakes area (U.S. Bureau of Economic Analysis, 2019[3]).
Ohio is located in the Great Lakes industrial region in the Midwest of the United States, and is well connected by road and waterway to many of the region’s largest population centres. Manufacturing and other forms of heavy industry, including automotive manufacturing and the production of rubber and fabricated metals, have traditionally been leading economic sectors in the state. Mining, agriculture and construction are also important industries in the state, though compared to manufacturing they provide a relatively small contribution to the overall economy.
Following the 2008-09 economic recession, Ohio’s GDP recovered quickly, and increased by 40% in the period from 2009 to 2018 (U.S. Bureau of Economic Analysis, 2019[4]). The state has been undergoing a period of de-industrialisation for many decades, in tandem with other nearby areas that make up the United States’ “rust belt”. As in other rust-belt areas, much of the economic growth of recent years has been driven by growth in the service economy, which contributed 65% of the overall growth in GDP between 2009 and 2018 in Ohio. Over the same period, the GDP of the goods-producing sector increased by 53% and the sector has maintained its share of the overall Ohio economy – at about 22% – over the past decade (U.S. Bureau of Economic Analysis, 2019[5]). Manufacturing remains a vital industry in Ohio; the state is the third largest producer of manufactured goods in the United States, after California and Texas (Ohio Development Services Agency, 2019[2]). Nevertheless, evidence indicates that the nature of many manufacturing jobs is changing rapidly (Box 4.1).
Efforts have been made at the state level to diversify the economy as traditional industries decline. In particular, through its long-established Third Frontier initiative, Ohio has invested heavily in enhancing capabilities for research and development and entrepreneurship in technology (Ohio Development Services Agency, n.d.[6]). In recent decades, Ohio has become one of the leading US states for technological research and development in areas such as fuel cell development, biomedical instrumentation, aerospace, defence and biotechnology. As of 2018, the information and communications technology (ICT) industry made up around 6% of Ohio’s economy, and employed 7% of the workforce (COMPTIA, 2019[7]). Some start-up clusters have also developed in Ohio in recent years, particularly in Cincinnati and Columbus, which both perform well nationally in measures of start-up growth and activity (Ewing Marion Kauffman Foundation, 2017[8]).
As in other states and jurisdictions, macro-level indicator values mask important internal variations. Ohio is among the US states that suffer from marked regional inequality, in the context of decline in the traditional industrial and coal mining industries in some areas of the state. Half of the 88 counties of Ohio have poverty rates greater than the US national average, with the highest poverty rates in the Appalachian region (Ohio Development Services Agency, 2019[9]).
Ensuring a sufficient volume of skilled workers to meet current and future economic needs is an ongoing concern in Ohio. The state is ageing; in the year 2000, Ohio had 3.2 million people under the age of 20, compared to 1.9 million over the age of 60. By 2017, the estimated population under 20 was 2.9 million, compared to 2.7 million people over 60 (U.S. Census Bureau, 2018[10]).The changing demographic profile could lead to more pronounced labour market shortages in the coming years, as much of the incumbent workforce reaches retirement age. Indeed, by 2030 it is estimated that 20% of the Ohio population will be aged 65 years or over, and in nine counties the share is likely to be above 25% (Scripps Gerontology Center, 2019[11]).
Table 4.1 presents an overview of some key contextual indicators for Ohio.
Table 4.1. Ohio at a glance
Notes: All numbers are for 2018 unless otherwise noted. Racial and ethnic categories are mutually exclusive. MIT Living Wage annual calculations are based on full-time working hours (2 080 hours per year).
Box 4.1. The changing face of manufacturing globally and in Ohio
Across OECD countries, major changes in goods production and distribution processes are taking place. In addition to automation and increasing use of software and data in the manufacturing process, new production technologies, such as 3D printing, synthetic biology and nanotechnology, are making manufacturing processes more efficient and reliable while also reducing cost. (OECD, 2018[12]) This evolution of manufacturing is also evident in Ohio, where regions of the state with a strong manufacturing tradition have shifted focus from low-tech to high-tech industries (Bacher, 2012[13]).
As in the wider United States, the number of manufacturing jobs in Ohio has increased in the last decade, while wages have also increased (Figure 4.1). New manufacturing facilities have also been established; the volume of new site selections for businesses in Ohio was second-highest in the United States in 2017, with over half of new sites earmarked for manufacturing (Ohio Manufacturers’ Association, 2018[14]).
Figure 4.1. Index of change in manufacturing employment and earnings, 2010-19
Note: Employment and earnings data are as at December of each year, and seasonally adjusted.
Source: U.S. Bureau of Labor Statistics (2019[15]), State and Metro Area Employment, Hours and Earnings (database), https://www.bls.gov/sae/data/home.htm.
Between 2000 and 2016, some sectors within the manufacturing industry in Ohio have grown rapidly, while others have diminished. By 2016, output in manufacturing of motor vehicles, trailers and cars had halved from 2000 levels (from USD 24.4 billion to USD 12.1 billion), while chemical manufacturing is now the largest manufacturing industry in Ohio, contributing USD 16 billion to the economy in 2016.
The required skillset of manufacturing employees has also evolved rapidly. Beyond traditional manufacturing-related competencies, employers in the United States are increasingly searching for people who have strong competence with computer-aided technologies, quality control, or engineering process improvement (Emsi, 2019[16]). The changing nature of manufacturing jobs and industries therefore creates a strong imperative for employers, policy makers and education institutions to upskill workforce in sufficient numbers to align with industry needs.
Sources: Bacher (2012[13]), Emsi (2019[16]), OECD (2018[12]), Ohio Manufacturers’ Association (2018[14]), U.S. Bureau of Labor Statistics (2019[15]).
In Ohio’s tight labour market, demand for skilled workforce is high, and likely to increase further in the future
The labour market in Ohio has been steadily adding jobs in the years following the 2008-09 economic and financial crisis. Non-farm employment has increased by almost 6% in the five years from 2014-19, with almost all sectors of the economy recording jobs growth in this period. Trade, transportation and utilities is the largest single sector of employment, accounting for more than 18% of non-farm employees in the state in January 2019. A further 17% of employees work in the education and health services sector. Other major sectors include the government sector (14% of employees) and professional and business services sector (13% of employees) (U.S. Bureau of Labor Statistics, 2019[15]).
Despite the changes in the manufacturing industry in Ohio in the most recent decade, the long-term labour market trend has been a steady shift towards service-providing industries. While the overall numbers in non-farm employment in Ohio at the beginning of 2019 were similar to the levels in 2000 (approximately 5.6 million people) the share employed in goods-producing jobs declined from 23% in 2000 to less than 17% in 2019 (U.S. Bureau of Labor Statistics, 2019[15]).
The labour market in Ohio has become tighter in recent years. The unemployment rate has steadily declined from a peak of 11.1% in January 2010 to 4.1% in November 2019, though it remains slightly higher than the national average. Over the same period the employment rate increased by more than two percentage points from a low point of 58.2% at the beginning of 2010. While some level of underemployment will always exist (as some graduates choose to work in non-graduate jobs and transition between education and graduate employment or between graduate jobs) in the tight labour market in Ohio, there is limited evidence of underemployment of higher education graduates. At the same time, as in other states, labour force participation has declined over the past decade, even as the number of available jobs has increased (Figure 4.2). The labour force participation rate in Ohio in November 2019 was just under 63%, similar to the national average level, and has remained close to this level since 2014. Many contributing factors to declining labour force participation have been identified, including changes in job quality, required skills and job location since the recession, as well as addiction problems and the ageing population (Hanauer and Mcgowan, 2019[17]).
As in many other states, a geographic mismatch is evident in Ohio, with larger metropolitan areas experiencing labour market shortages, while workers in many rural areas have difficulty finding jobs (OWT, 2018[18]). The highest unemployment rates are in Ohio’s Appalachian regions, where around 15% of Ohio’s labour force is located. Unemployment is above the state average in 30 of the 32 counties that comprise the Appalachian region, and surpasses 7% in three counties in the region (Monroe, Meigs and Adams). In other parts of the state, such as in Mercer Country, Delaware County and Wyandot County, the unemployment rate is below 3.5% (U.S. Bureau of Labor Statistics, 2019[19]).
The underlying demographic situation also indicates a likelihood of increasing demand for workers for many occupations into the future, as the number of jobs becoming vacant due to retirements continues to grow. Data from the Ohio Department of Jobs and Family Services indicate that the labour market is likely to add approximately 250 000 jobs between 2016 and 2026, putting even greater pressure on workforce supply (Ohio Department of Jobs and Family Services, 2018[20]).
Figure 4.2. Trends in the key labour market indicators in Ohio, 2009-19
Notes: Data in panels A, B and C are seasonally adjusted. The labour force participation rate is defined as the percentage of people who are either employed or unemployed (but looking for jobs) out of the total civilian non-institutional population, which includes all individuals over the age of 16 who are potentially available for work. The employment rate is the percentage of people who are employed out of the total civilian non-institutional population. The unemployment rate is the percentage of people who are unemployed (but looking for jobs) out of all individuals in the labour force (employed or unemployed but looking for jobs). The mean hourly wage is not adjusted for inflation.
Sources: Panels A, B and C: U.S. Bureau of Labor Statistics (2019[21]), Labor Force Statistics from the Current Population Survey (database), https://www.bls.gov/cps/tables.htm; Panel D: U.S. Bureau of Labor Statistics (2019[22]), Occupation Employment Statistics (database), https://www.bls.gov/oes/home.htm.
In 2018, around 43% of the young adult population (aged 25-34) had attained a post-secondary degree, while a further 22% had some college education but had not attained a degree1 (Figure 4.3). These shares are slightly higher than the education levels in the population aged 25-64, where just over 40% have at least an associate’s degree. Going forward, a key policy goal in Ohio is to raise educational attainment levels in the overall population substantially, to help ensure an adequate supply of workforce for existing middle- and high-skilled jobs, and emerging jobs of the future in the state (see Section 4.3). In general, higher levels of education also can help to insulate graduates against the effects of economic downturns: in the most recent economic crisis, beginning in 2008-09, unemployment in the OECD rose to more than 12% for those without upper secondary education, while remaining below 5% for higher education graduates (OECD, 2016[23]). Higher education graduates are also more likely to perform the non-routine jobs most resistant to automation, and are in a stronger position to pivot to new job profiles and keep pace with technological developments in the workplace (OECD, 2016[24]; OECD, 2019[25]).
Figure 4.3. Level of educational attainment for Ohio residents aged 25-34, 2018
Source: U.S. Census Bureau (2019[26]), American Community Survey 2018 (database), https://www.census.gov/programs-surveys/acs/data.html.
The higher education system
The Ohio Department of Higher Education co-ordinates and oversees higher education in the state
The Ohio Department of Higher Education (ODHE), formerly known as the Ohio Board of Regents, is the cabinet-level agency that oversees higher education in Ohio. Originally created in 1963, the ODHE is led by the Chancellor of Higher Education, who is appointed by the Governor. The current Chancellor, Randy Gardner, was a long-standing member of the Ohio Legislature before being appointed by Governor DeWine in January 2019 to head the ODHE. With a permanent staff of around 80 people, the agency’s main responsibilities include approving new degree programmes in public and private higher education institutions, managing the allocation of state funds to public higher education institutions, co-ordinating state-funded financial aid programmes, and supporting the state Legislature in policy making and budget planning. The ODHE operates under the direction of the Chancellor and Governor, and implements policy adopted by the General Assembly. Four permanent staff, including one of the Vice Chancellors, work specifically on higher education and workforce alignment.
Each of Ohio’s 14 public universities and 23 community colleges is autonomously governed by its own board of trustees. Each institution has considerable autonomy in relation to designing its educational offerings, managing staffing and compensation levels, setting admission criteria, and determining internal quality assurance processes. Exceptions to institutional autonomy are set forth in the Ohio Revised Code and include, notably, compliance with state rules relating to programme approval, transfer and articulation, and tuition increases. As elsewhere in the United States, public and private institutions in Ohio have to comply with federal regulations relating to external accreditation in order to be eligible to receive federal student aid funding.
The Governor’s Office of Workforce Transformation plays a central role in co-ordinating Ohio’s skills and workforce policies
The Ohio General Assembly is the main driver of higher education policy in the state. Higher education objectives and initiatives are set forth in the biennial state operating budget, adopted every odd-numbered year, while any capital investments relating to higher education are included in the biennial capital budget adopted every even-numbered year. The Legislature also leads on the development of any specific higher education legislation or amendments to the Ohio Revised Code relating to higher education. The Legislature consults with the ODHE and other state executive agencies and stakeholder groups as part of its law-making process.
Higher education policy also comes within the remit of the Governor’s Office of Workforce Transformation, which co-ordinates Ohio’s efforts in the area of workforce development through direct co-operation with the ODHE, the Ohio Department of Education, the Ohio Department of Job and Family Services (ODJFS) and other state agencies (see Box 4.2).
Associations of higher education providers and employers also contribute to policy making in the field of higher education and workforce development. The Inter-University Council (IUC), for example, represents four-year public state universities, while the Ohio Association of Community Colleges (OACC) represents two-year public community colleges and the Association of Independent Colleges and Universities (AICUO) represents 51 major private universities and colleges in the state. The Ohio Chamber of Commerce, local chambers, and the Ohio Business Roundtable (Ohio BRT), representing the interests of major companies in Ohio, are among the employer organisations routinely involved in higher education and workforce policy.
Box 4.2. Governor’s Office of Workforce Transformation in Ohio
Under the direct responsibility of the Lieutenant Governor, the Governor’s Office of Workforce Transformation (OWT) seeks to co-ordinate Ohio’s skills and workforce policies. Established in 2012, the Office acts as a dedicated co-ordination point between 17 state agencies, including the Departments of Education (ODE) and Higher Education (ODHE), Jobs and Family Services (ODJFS), Rehabilitation and Corrections (DRC), and the Governor’s Office of Appalachia, responsible for regional development in the south east of the state.
Advised by the Governor's Executive Workforce Board, composed of leaders in business, education, and workforce development, the OWT’s stated objective is to identify the needs of Ohio businesses and align workers' skills with those needs “to close the skills gap and get more people into rewarding careers”. The OWT seeks to do this primarily though established priorities in the state workforce development plan (see Section 4.3) and by connecting Ohio's business, training and education communities to support skills development and workforce alignment.
Source: OWT (2020[27]).
The majority of students in Ohio attend public institutions, and there is an increasing focus on shorter-duration programmes of study
Post-secondary education in Ohio is provided by a diverse range of institutions. In addition to public and private four-year universities, there is an extensive network of public two-year community colleges and some private institutions delivering shorter-duration qualifications. In addition, the Ohio Technical Center (OTC) network delivers a range of courses leading to industry-recognised and vocational qualifications, and high school graduates can also pursue federal apprenticeships.
All public higher education institutions and some private institutions in Ohio are accredited by the Higher Learning Commission (HLC), one of six regional bodies responsible for institutional accreditation in the United States. The OTCs are accredited by a national agency, the Accrediting Commission of Career Schools and Colleges (Accrediting Commission of Career Schools and Colleges, 2020[28]), while other national agencies accredit the remainder of institutions. In total, there are about 250 institutions offering post-secondary education programmes based in the state, in the public and private sectors (Table 4.2).
Table 4.2. Post-secondary institutions in Ohio, 2019
Note: Only post-secondary institutions listed in the Integrated Postsecondary Education Data System (IPEDS) as being located in the state of Ohio are included in this table. Each institution is counted only once in the table, regardless of the number of campuses it operates.
Sources: ODHE (n.d.[29]), Public Institution Profiles, https://www.ohiohighered.org/campuses/map; NCES (2019[30]), Integrated Postsecondary Education Data System (database), https://nces.ed.gov/ipeds/use-the-data.
In 2018, Ohio post-secondary institutions had more than 800 000 enrolled students across all institution types, making the state the seventh largest post-secondary education system in the United States in terms of enrolments (NCES, 2018[31]). Approximately half of the student body was enrolled in the 14 public four-year institutions, and more than one-quarter of students were enrolled in public two-year colleges (Figure 4.4). The majority of the private sector is made up of not-for-profit institutions, while enrolment in private for-profit colleges makes up about 4% of overall enrolment.
Figure 4.4. Annual enrolment in selected types of post-secondary education institutions, 2001-18
Source: NCES (2019[30]), Integrated Postsecondary Education Data System (database), https://nces.ed.gov/ipeds/use-the-data.
While absolute numbers remain relatively small, an increasing number of young people in Ohio are availing themselves of federal apprenticeships, as an alternative to more traditional post-secondary options. In 2018, there were 28 000 apprentices enrolled in Ohio, double the 2011 level. This reflects the national trend of renewed interest in apprenticeships among young people; the number of new apprentices across the United States has increased steadily since 2011 (U.S. Department of Labor, 2019[32]).
Public four-year institutions
Ohio’s 14 public four-year institutions educate the majority of post-secondary students in the state, awarding bachelor’s (ISCED 6) and master’s (ISCED 7) degrees, and providing doctoral-level training (ISCED 8). The public four-year sector in Ohio is also a major contributor to national research and development activity. Public universities in Ohio range from “open access” institutions, such as Central State University, Shawnee State University or Youngstown State University, to highly selective institutions such as Miami University and The Ohio State University. Six Ohioan public universities ranked in the top 200 institutions nationally in 2017 for expenditure on research and development (R&D), including The Ohio State University and the University of Cincinnati, which ranked 22nd and 54th respectively (National Science Foundation, n.d.[33]).
Many of the public state universities have regional branch campuses in addition to their main campus, which enhances accessibility to the public university system throughout the state. In total, about 17% of all public university students were attending branch campuses in 2018 (Table 4.3).
Table 4.3. Public university campuses and enrolment in Ohio, 2018
Note: Enrolment totals are based on fall headcount data.
Source: ODHE (n.d.[34]), Headcount Enrollment Statistics, https://www.ohiohighered.org/data-reports/enrollment.
All of Ohio’s public universities have arrangements that allow students to begin their studies at either a community college or a branch campus. This can help to defray costs substantially for students, by allowing them to continue to live with family or in their local region while beginning their post-secondary studies. For example, at community colleges, students who complete the Ohio Transfer Module and achieve an associate’s degree with a designated transfer pathway become eligible to transfer to a main university campus (see Box 4.6). Students studying at regional university campuses can become eligible for transfer to the main campus after meeting a designated set of criteria, which can differ across institutions, but generally requires the completion of a minimum number of credit hours or attaining a minimum grade point average in college coursework.
At the same time, students can also complete their entire degree programmes at regional university campuses. Many of the branch campuses are specialised in particular fields of education, such as the Ohio State Agricultural and Technical Institute in Wooster or the Heritage Medical Clinic in the Cleveland campus of Ohio University.
Public sub-baccalaureate institutions
Public sub-baccalaureate institutions in Ohio comprise community colleges and Ohio Technical Centers. Ohio has 23 community colleges across the state, offering a range of sub-baccalaureate qualifications, including associate’s degrees and certificates. As is the case in other US states, community colleges play an important role in improving access to post-secondary education in Ohio, and tend to serve a broader cross-section of the population than the public university sector. Under-represented populations represent a much larger share of enrolment in community colleges than in public or private four-year colleges (Table 4.4).
While the share of overall student enrolments at community colleges has remained reasonably steady in the past 10 years, in absolute numbers, enrolment in Ohio’s community colleges has been in decline in the last decade, falling from a peak of about 315 000 in 2010/11 to just under 247 000 in 2017/18. This reflects, to some extent, the current high labour market demand in Ohio; in general, demand for community college education across the United States tends to fluctuate depending on prevailing local labour market conditions (Hillman and Orians, 2013[35]).
The OTC network, funded through the Ohio Department of Higher Education and located throughout the state, delivers a range of career and technical education. Programmes offered by the OTCs generally take between six and eighteen months to complete, and lead to the award of a vocationally-oriented industry certification or licence. In some cases, credits earned from completed OTC programmes are transferable to a degree programme at a two-year or four-year institution. During the 2016/17 academic year, just over 11 800 credentials were awarded by OTCs, an increase from the 9 657 awarded during 2012/13 (ODHE, 2019[36]). Community colleges are also increasingly offering students the opportunity to earn industry-recognised credentials, which can be in addition to, or integrated into, their more traditional offerings of associate’s degrees or post-secondary certificates. These trends reflect the recent state-wide push to incentivise and improve “certificate productivity” in colleges and OTCs (Box 4.3).
Box 4.3. Improving certificate productivity in Ohio
In the last decade, Ohio state authorities have taken a number of steps to improve non-degree certificate productivity in career and technical education. Key actions have been as follows:
In 2014, the state adopted new requirements on institutions for reporting certificates, and a new classification of certificates into technical certificates and general certificates, with a premium subsequently placed on technical certificates.
A new process was developed to designate certificates as having labour market value, by ascertaining whether the certificate is specifically requested by employers in job advertisements, or by other means of demonstrating labour market value. The state maintains a public list of technical certificates that have achieved the labour market value criteria.
Since 2016/17, state funding for Ohio Technical Centres is based completely on certificate productivity.
Ohio has developed clear transfer pathways to degree programmes from many certificate programmes (see Section 4.3).
Source: ODHE (n.d.[37]).
Performance monitoring mechanisms for publicly funded career and technical education cover both community colleges and Career and Technical Centers. Under the Carl D. Perkins Career and Technical Education Act, introduced by the federal government in the 1980s and last re-authorised in 2018, states are required to develop accountability mechanisms for career and technical education providers, and report on key performance indicators, including non-traditional participation and completion, student retention and placement, and credential attainment. State performance targets for each of the indicators are negotiated with the U.S. Department of Education, and local performance targets are in turn agreed between the state and the institutions. Institutions that do not reach 90% of their target are required to submit a performance improvement plan to the state (Ohio Board of Regents, 2015[38]).
Private higher education institutions
The majority of students enrolled in private post-secondary institutions are in the not-for-profit sector, at four-year institutions, which is the third largest post-secondary sector in the state (Table 4.4). Institutions in this sector offer a range of undergraduate and graduate programmes across the state and vary in mission and orientation, encompassing comprehensive and research-active universities, religious colleges, liberal arts colleges and specialist institutions.
About 4% of students in Ohio attend private for-profit institutions. In general, the number of for-profit institutions across the United States has been in decline in recent years, following tightening of federal restrictions on eligibility for student financial aid at many institutions in this sector as part of the Gainful Employment regulations (National Student Clearinghouse Research Center, 2019[39]).
Table 4.4 provides a profile of public and private not-for-profit higher education institutions in Ohio.
Table 4.4. Profile of public and private not-for-profit higher education institutions in Ohio
Notes: These figures are based on information from Ohio-based higher education institutions that are eligible for federal (Title IV) funding and that are required to report student-level data to state and federal authorities. Colleges and universities that do not receive some forms of federal or state-funded student assistance, are therefore not included. The 150% graduation rate refers to the percentage of graduates who completed their degree within one and a half times the normal completion time; that is, 6 years for a four-year degree and 3 years for a two-year degree. The completion rate for four-year institutions is based on the 2012/13 graduate cohort and the completion rate for two-year institutions is based on the 2011/12 graduate cohort.
Sources: NCES (2019[30]), Integrated Postsecondary Education Data System (database), https://nces.ed.gov/ipeds/use-the-data; NCES (2018[31]), Digest of Educational Statistics 2018, https://nces.ed.gov/programs/digest/.
4.2. Assessment of labour market outcomes: The alignment between supply and demand of graduate skills in Ohio
Alignment of supply and demand
The share of jobs requiring a post-secondary credential in Ohio is expected to increase rapidly in the coming years
Public authorities in Ohio use projections of labour market needs to inform workforce planning. The Bureau of Labour Market Information in the Ohio Department of Jobs and Family Services (ODJFS) produces projections of jobs by occupation and type of qualification required, which are updated at regular intervals. A “Short-term Outlook” provides a near-term indication based on current trends, while longer-term projections anticipate employment needs over the coming decade. The Department of Jobs and Family Services also periodically publishes a list of in-demand occupations, compiled using statistics on job openings, labour market outcomes, a survey of employers and recent employment trends. In addition to informing potential students about career areas with the best employment prospects, the in-demand jobs list is used to prioritise the allocation of funding towards producing new credentials. For example, the state requires that at least 85% of federal funding allocated under the Workforce Innovation and Opportunity (WIOA) Program is invested in programmes related to in-demand occupations.
The Bureau of Labour Market Information classifies occupations according to the typical experience and education required for entry to the occupation, as assigned by staff in the U.S. Bureau of Labor Statistics (U.S. Bureau of Labor Statistics, 2019[40]). According to the latest long-term occupational projections, overall, about 40% of jobs in Ohio in 2026 will require a post-secondary credential as a minimum standard for entry (Ohio Department of Jobs and Family Services, 2018[20]). Demand for workforce with post-secondary credentials is expected to increase particularly strongly in certain occupational groups, including healthcare and technical practitioners, education and training, management, and business and financial operations. However, most occupational groups are likely to either maintain current demand levels, or surpass them by 2026 (Figure 4.5).
Figure 4.5. Projected employment growth in occupations that typically require post-secondary education, 2016-26
Note: Occupational groupings are based on the Bureau of Labour Statistics Standard Occupational Classification. See the Reader’s Guide for more details.
Source: Ohio Department of Jobs and Family Services (2018[41]), Ohio Job Outlook, http://www.ohiolmi.com/proj/OhioJobOutlook.htm.
The projection by the ODJFS of 40% of jobs requiring a post-secondary qualification by 2026 is likely to be overly conservative, as it is based on the minimum educational requirements for entry into an occupation, assumes that educational requirements will not change over time, and may not adequately capture emerging jobs in rapidly evolving fields. Analysis by the Georgetown Center on Education and the Workforce (CEW) showed that, in 2010, actual education levels of those employed in various occupations were substantially higher than the minimum level indicated by the U.S. Bureau of Labor Statistics. Alternative projections of educational demand by CEW, based on these actual education levels across occupation, and employment growth rates by industry, indicated that by 2020, 65% of all jobs nationally would require at least some post-secondary education (Carnevale, Smith and Strohl, 2013[42]). Within this 65%, 18% of jobs are expected to require a level of “some college or post-secondary certificate”, while the remaining 47% of jobs are projected to require at least an associate’s degree. Ohio policy makers have adopted this higher projection of 65% of workers requiring post-secondary education as the most likely scenario (Demaria, Carey and Burgess, 2018[43]).
The higher level of actual qualifications among staff across various occupations may, to some extent, reflect a trend of “credential inflation” observed across the United States and other economies, with employers demanding higher credentials for jobs that traditionally would have required a high school diploma only (Fuller and Raman, 2017[44]). At the same time, it is evident that the world of work is changing rapidly, as more routine jobs become vulnerable to automation, new job types emerge, and the nature of many existing jobs is evolving as technology becomes more embedded across occupations (OECD, 2019[25]). Research by Burning Glass Technologies on employer needs indicates a new set of skills is rapidly becoming foundational in today’s digitalised economy: digital building block skills, such as data management and programming; business enabling skills (such as project management and business process); and “human skills” (such as critical thinking, collaboration and problem solving) (Burning Glass Technologies, 2019[45]). In this context, public authorities across the United States have identified high-quality post-secondary education credentials as the best means to develop and demonstrate the broad range of skills and competencies demanded in the contemporary labour market.
Many of the jobs on the most recent list of in-demand jobs compiled by the Ohio Department of Jobs and Family Services do not necessarily require a post-secondary qualification, or even a high school qualification. For example, the highest identified demand is for labourers, customer service representatives and office clerks, none of which specify a post-secondary credential as a necessary minimum level of education (Table 4.5). At the same time, 56% of all of the occupations on the list require post-secondary attainment as a minimum level (Ohio Department of Jobs and Family Services, 2018[20]). This reflects the wider trend across the United States of job growth concentrating in areas where post-secondary credentials are required; national employment projections show that 15 of the 20 fastest-growing occupations require some post-secondary education (U.S. Bureau of Labor Statistics, 2019[46]).
Table 4.5. The top ten in-demand jobs in Ohio and typical education required, 2019
Note: Job titles are based on the Bureau of Labor Statistics Standard Occupational Classification; see the Reader’s Guide for more details.
Source: OhioMeansJobs (2019[47]), In-demand occupations list, http://omj.ohio.gov/OMJResources/In-DemandOccupations.stm.
Unmet demand for post-secondary education is already evident in many sectors of the economy in Ohio. Shortages of graduates with a post-secondary credential have become acute in many occupations (see the next section), and are likely to increase in the future. It has been estimated that the greatest shortages across the state are likely to occur in middle-skill jobs: those that require some post-secondary education but not a bachelor’s degree (National Skills Coalition, 2017[48]; JP Morgan Chase and Co, 2015[49]). As a result, there is a collective focus within both the higher education system and wider workforce development policy on increasing the output of graduates with certificates and other shorter-term post-secondary credentials, such as industry certifications, as discussed in the next section.
Credential awards are increasing, particularly for short-term certificates, but Ohio will not reach its attainment goal at current levels of output
Given evidence of widespread and deepening shortages of workers with post-secondary education, states across the United States are responding by putting greater emphasis on workforce development (see Chapter 2). Ohio is 1 of 42 states that has placed quantifiable and ambitious post-secondary attainment goals at the centre of its workforce development strategy (Lumina Foundation, 2019[50]). In 2018, the Governor’s Office of Workforce Transformation, the Ohio Department of Education and the Ohio Department of Higher Education jointly endorsed a state-wide goal for post-secondary attainment: by 2025 65% of Ohioans aged 25-64 should have a post-secondary credential of value in the workplace (Demaria, Carey and Burgess, 2018[43]; Ohio Board of Regents, 2015[51]).
State authorities have estimated that, in order to achieve the 2025 attainment goal, Ohio will need to produce almost one million additional credentials in total between 2017 and 2025 (Ohio Board of Regents, 2015[51]). The establishment of the numerical goal provides a common focus for all organisations and agencies in the state with a role to play in workforce development. Ohio has also taken steps to monitor advancement towards the goal at the state level, by tracking levels of post-secondary attainment in the state and producing regular progress reports.
Ohio has made notable gains in the past decade on post-secondary attainment, even as overall enrolments in post-secondary education have fallen. By 2017, an estimated 45% of adults aged 25-64 had a degree or workforce-relevant post-secondary certificate, compared to 35% in 20082 (ODHE, 2020[52]). Within the 45%, around 5% hold post-secondary certificates, while the remaining 40% hold a degree. The overall volume of credentials awarded has also gradually risen in the last decade, with increases recorded in awards at all levels (Figure 4.6). As discussed in Section 4.3, the introduction of a performance-based award formula for the State Share of Instruction in 2012, which allocates funding to post-secondary institutions based on completion of qualifications and courses, incentivises institutions to increase the volume of credentials awarded annually.
Figure 4.6. Trends in the production of degrees by education level, 2009-18
Note: See Reader’s Guide for further information on credential education levels.
Source: ODHE (2019[36]), Degrees & Certificates Awarded at Ohio Institutions (database), https://www.ohiohighered.org/data-reports/degrees.
In absolute numbers, the greatest increase in awards has been at the bachelor’s level, where annual degrees awarded increased from 38 483 in 2009 to 49 963 in 2018. However, credential output has expanded most substantially at the less-than-one-year award level, where credential output has more than tripled since 2009 and reached an annual level of 10 800 awards in 2018 (Figure 4.6). This category of credentials are defined in Ohio as awards for completion of organised programmes of less than 30 semester credit hours, or less than 900 clock hours, that are designed for an occupation or specific employment opportunities (for technical certificates) and completion of an organised programme of study at sub-baccalaureate level of less than one year (for general certificates). These awards made up 14% of all qualifications awarded in 2018, compared to 7% in 2009, reflecting Ohio’s focus in recent years on non-degree employment-oriented credentials as a cost-effective way to upskill the population (ODHE, n.d.[37]).
Despite increases in output at all levels of post-secondary credentials, current trends indicate that the increases in awards at all levels are not at the scale needed to reach the attainment goal in 2025. An extra one million credentials between 2017 and 2025, achieved linearly over time, indicate that annual award production would need to be more than double its 2018 level of around 105 000 awards. Latest projections from Lumina Foundation, based on the rates of increase in credential completions in recent years, show that the post-secondary attainment rate among adults is unlikely to surpass 50% by 2025 if current trends continue (Lumina Foundation, 2019[53]).This highlights the challenge ahead for Ohio.
Skills shortages are evident in many fields and industries, creating risks for Ohio’s economy
Across Ohio, many economic sectors are experiencing an ongoing struggle to fill open positions. A 2015 analysis by the National Skills Coalition found that shortages were most severe in the middle-skill jobs category, where 55% of jobs in the economy are concentrated, but only 47% of total workers are qualified at the appropriate level (National Skills Coalition, 2017[48]). However, across the state, shortages of workers at all skill levels are evident. In the Northeast, for example, there is a severe shortage of manufacturing and construction professionals; health professionals and technicians; architects; finance and business professionals; and supervisors of skilled workers (Team NEO, 2019[54]).
Skills shortages create both economic and social risks across Ohio. During the Ohio fact-finding mission, the OECD review team heard from business leaders that shortages of qualified workers in some industries are resulting in a “rush to automate” to support continued business growth in the face of a lack of qualified workers. In the manufacturing industry, employers rank the lack of qualified workers as the number one challenge hampering growth. In 2019, 53% of employers in the sector reported that worker shortages would directly affect profits in their company, an increase from 45% in 2017 (MAGNET, 2019[55]).
The social impact of skills shortages can also be acute. Healthcare practitioner coverage is identified as insufficient in 59 geographic areas across Ohio (Health Resources and Services Administration, 2020[56]). In Appalachia, there are shortages of paediatric primary care providers, dentists and mental health providers, as well as early childhood education and care providers. This creates risks for the healthy growth and development of children in the region (Children's Defense Fund, 2016[57]). As in many other states, Ohio is also dealing with a shortage of education professionals, including arts and science teachers, Teaching English as a Second Language (TESOL) teachers, teachers for special educational needs and school psychologists (Office of Postsecondary Education, 2017[58]).
At the same time, there are indications that the supply of new credentials to the labour market in many high-demand areas is stagnant or decreasing. While overall, the volume of credentials awarded is on an upward trajectory in Ohio, the share of qualifications in many fields experiencing labour market shortages has declined in the past decade (Figure 4.7). For example, despite acute labour market shortages, the share of credentials of all types awarded in the field of education has declined from 2008 to 2018, with annual output of more advanced qualifications falling sharply (by more than 25% for bachelor’s degrees and more than 45% for master’s degrees). In health, while the overall volume of qualifications awarded increased by about 25% between 2008 and 2018, certificate and associate’s degree production has decreased over the same period (Figure 4.7).
Figure 4.7. Qualifications awarded in selected fields of education, 2008-18
Source: Adapted from NCES (2019[30]), Integrated Postsecondary Education Data System (database), https://nces.ed.gov/ipeds/use-the-data.
Outside of increasing its own production of skilled workforce, there appear to be limited opportunities for Ohio to mitigate the economic risks created by skills shortages. Across the OECD, many jurisdictions have taken measures to encourage migration of skilled workers, as a means to shore up local labour supply and address acute skills shortages, including expanding existing programmes and the range of occupations eligible for award of a visa (OECD, 2019[59]). Immigrants accounted for 8% of the high-skilled workforce in Ohio in the period 2009-13, double the share of immigrants in the overall Ohio population, and were less likely to be subject to underemployment than elsewhere in the United States (Batalova, Fix and Bachmeier, 2016[60]). However, declines in immigration across the United States and restrictions in scope to the main skilled labour visa programme (H1-B)3 limit the potential to fill acute skills needs through immigration. This puts an even greater onus on the workforce development system in Ohio to meet its future labour market needs by upskilling a larger share of its incumbent population.
Some notable differences also exist in attainment between racial and ethnic groups and gender across different fields of study (Figure 4.8). For example, Black/African American graduates are less likely to be awarded a degree or certificate in some fields that are highly valued in the labour market such as mathematics and statistics, engineering and computer and information services; about 4% of all degrees awarded to Black/African American graduates are in these fields, compared to more than 7% of all degrees awarded to Whites, and about 13% of all degrees awarded to Asians.
These differences shown in Figure 4.8 indicate that some high-value fields of study or those with labour market shortages appear to be currently less accessible to certain population groups. Drivers of these differences can be linked to underlying socio-economic patterns, or reflect wider stereotypical or cultural beliefs related to fields of study. Regardless, their impact is to reduce the overall size of the available talent pool for these fields in Ohio. Identifying and tackling the underlying reasons for variations in field of study choice by gender or race/ethnicity is therefore likely to be an ongoing policy concern in the future in Ohio, as in other jurisdictions.
Figure 4.8. Certificates/degrees awarded by race/ethnicity, gender and field of study, 2018
Note: The figure includes all credentials awarded from certificate to doctoral level.
Source: Adapted from NCES (2019[30]), Integrated Postsecondary Education Data System (database), https://nces.ed.gov/ipeds/use-the-data.
Bottlenecks and barriers in the pipeline
Addressing imbalances in post-secondary attainment between different population groups is vital to meeting Ohio’s state-wide attainment goal
As discussed above, at current rates of enrolment and completion in post-secondary education programmes, Ohio is unlikely to meet its ambitious target for post-secondary education attainment. A number of supply-side factors create leaks in the talent pipeline and impede progress towards the goal. Firstly, the overall volume of students passing through the high school system has been decreasing in Ohio in recent years. In addition, a sizeable share of the young student population does not make it to high school graduation, or graduates without the necessary knowledge and skills for college-level study (Table 4.6).
Table 4.6. Indicators on upper secondary education imbalances in Ohio
Note: Students are generally identified as economically disadvantaged via federal meal programs, open to pupils from households with incomes at or below 185% of federal poverty levels. Through a recently enacted program known as the Community Eligibility Provision, a certain number of students are deemed economically disadvantaged even though they come from households above 185% poverty. In contrast, children in poverty are from households at or below 100% federal poverty; they also include some non-school-aged children.
Source: Adapted from Thomas B Fordham Institute (2019[61]), Ohio education by the numbers: 2019 statistics, http://ohiobythenumbers.com/.
Other barriers to increasing the availability of skilled workforce are also evident. One in two Ohio school students is classified as economically disadvantaged, and one in five students lives in poverty, both factors associated with lower levels of educational success (OECD, 2018[62]). Urban areas in particular have higher poverty rates and lower high school graduation rates in Ohio; almost 30% of high school students in urban districts do not graduate from high school within four years (Table 4.6). The loss and disengagement of talent in earlier levels of education therefore is a core barrier to increasing post-secondary attainment in Ohio, outside of the control of higher education policy makers.
As in other states, stark imbalances exist among population subgroups with regard to educational achievement, and ability to access the enhanced labour market prospects that post-secondary education brings. For example, while about 40% of the White population had at least a post-secondary certificate in Ohio in 2018, the share of the Black and Hispanic population with post-secondary education reached only 27%, a gap of more than 13 percentage points (Lumina Foundation, 2019[50]).
There is also a widening gender gap in post-secondary attainment – the female post-secondary attainment rate reached almost 49% in 2018, compared to just under 41% for males (ODHE, 2020[52]). The size of the gender gap has increased in recent years, mirroring the trend across the OECD of women pulling ahead on educational attainment (OECD, 2019[63]). Furthermore, gender gaps in achievement are more pronounced for some already lower-achieving groups, such as Black and Hispanic students and those from lower-income backgrounds. The intersection of group inequalities further increases the educational barriers faced by some subgroups and creates more extreme gaps in achievement.
State projection models of future attainment levels indicate that a range of adjustments to tackle the leaky pipeline would be required to increase the volume of credentials over current levels to the extent needed to approach Ohio’s goal of almost 1 million additional credentials by 2025. Table 4.7 shows the projected numbers of additional credentials that could be obtained under a number of different conditions related to individual variables, as calculated by the Ohio Department of Higher Education attainment goal projection model (ODHE, 2018[64]). For example, if the state managed to boost both high school graduation rates and post-secondary enrolment rates to the same levels as the top three states in the United States, it would contribute about 5% of the additional credentials required to meet the goal (Table 4.7). This reflects the demographic situation in Ohio, where the additional credentials gained by increasing high school completion and post-secondary enrolment would be offset, to some extent, by smaller cohorts of young people in the education system. Increasing the enrolment of adult learners to the levels of the top three states would also contribute an additional 5% of credentials to the goal.
Table 4.7. Projected additional credentials produced during 2017-25 under different scenarios
Note: Projected additional credentials refer to potential additional credentials produced under the given change in conditions alone, compared to the continuation of 2016 enrolment and completion rates. Projections also aim to consider future demographic change.
Source: ODHE (2018[64]), Attainment Goal Projection Tool, https://www.ohiohighered.org/attainment/projection-tool.
However, the projections indicate that closing gaps in attainment is by far the most promising pathway for Ohio to meet its attainment goal. Table 4.7 shows that addressing existing attainment imbalances between different population subgroups is likely to yield the most dramatic increases in attainment, compared to increasing overall high school completion, post-secondary enrolment rates, or enrolment in the adult population. The most promising avenues for increasing attainment may therefore be to strongly target attainment gaps between different sub-populations. For example, elevating the attainment rate of Black/African American, Hispanic, Native American and Alaska Native adults to the same level as the expected attainment rate of White adults by 2025 would contribute approximately 14% of the additional qualifications required to reach the goal. Raising the attainment rate of males to match the expected rate of females by 2025 would contribute about 34% of the required credentials to meet the goal (Table 4.7).
Much is already being done at the school level in Ohio to close achievement gaps between different groups of the population, and targeting increased achievement in particularly vulnerable subgroups. For example, schools are regularly evaluated on their ability to improve the achievement of students with disabilities, from lower-income backgrounds, and from disadvantaged minority groups (Ohio Department of Education, n.d.[65]). However, the underlying trends and future projections imply that Ohio will need to step up policy actions to close gaps, in order to achieve the attainment goal. Ohio could also consider defining more granular targets to support the goal that prioritise increasing throughput in areas with the most pressing need, or closing gaps between different subgroups.
Brain drain, economic imbalances across the state, and wider social issues slow down progress towards the goal
Across the OECD, regional inequalities have been compounded in the years following the 2008-09 economic crisis, as urbanisation continues to progress and regional differences in productivity and economic growth persist (OECD, 2019[66]). In the United States, employment growth rates in larger cities have far surpassed that of smaller cities and non-metro areas. While employment grew by over 14% in metro areas with a population of 1 million or more between 2010 and 2016, the growth rate in non-metro areas over the same period was at just over 2% (Muro and Whitman, 2018[67]). Intra-state economic inequalities are also pronounced within Ohio, where 10 of the 88 counties were responsible for more than 60% of Ohio’s overall GDP in 2018, and the bottom 40 counties combined contributed less than 10% of the state’s GDP (U.S. Bureau of Economic Analysis, 2019[68]).
Overall, Ohio is one of the US states that has experienced a net “brain drain” in the last decades, as highly educated young adults migrate to other states in greater numbers than those choosing to relocate from out-of-state to Ohio (United States Joint Economic Committee, 2019[69]). However, the economic imbalances within the state also create additional regional brain drain and contribute to differences in educational achievement across Ohio, as highly educated workers are attracted to areas of the state with better labour market prospects, contributing further to brain drain in certain regions of the state. As Figure 4.9 shows, in 17 out of Ohio’s 88 counties, less than one in four adults has an associate’s degree or higher, while in 8 counties around half of adults have a degree (Figure 4.9).
The geographic spread of attainment across the state reflects the difficulty in ensuring that employers in some regions can access an adequate pipeline of the skills they need. Concentration of talent in dynamic areas such as Columbus and Cincinnati can create some of the new economic activity the state needs, and help to achieve the attainment goal by providing attractive environments that encourage graduates to remain in the state. However, this also presents economic risks to areas of the state that may lose vital talent to major urban regions. The review team heard about the difficulties that employers faced in a number of regions to attract and retain suitably qualified workforce. Hence, it is important to ensure that workforce policy and regional development policy are closely aligned and complementary to each other (see Section 4.3).
Figure 4.9. Attainment rate of adults (25-64) in Ohio counties, 2017
Source: U.S. Census Bureau (2019[26]), American Community Survey 5-year Estimates (2013-2017), https://www.census.gov/programs-surveys/acs/data.html.
Economic stagnation and population decline also limit labour market opportunities and rewards in some areas of Ohio, and reduce the incentives for the local population to pursue post-secondary education. This is further compounded by the difficulty that the population in some disadvantaged rural areas can face to physically access post-secondary educational opportunities and improve their skills, as a result of being located in “education deserts” (Hillman and Weichman, 2016[70]). Indeed, the OECD review team in Ohio heard a number of times during their review visit that lack of transportation was a significant impediment to accessing both education and the labour market in some areas of the state.
At the same time, while talent tends to flow from rural to urban areas and physical access to education in rural areas is more difficult, a sizeable share of urban populations in the state face obstacles of their own to accessing post-secondary education. As discussed in the previous section, students in urban school districts across the state have lower high school completion rates, and lower rates of transfer to post-secondary education than suburban or rural students (Table 4.6). Urban poverty rates have also been on the increase in recent years (Ohio Development Services Agency, 2019[9]). Improving educational success in high-poverty urban areas of Ohio can increase the available pool of talent to meet labour market needs, as well as reduce overall economic inequality. The state-wide introduction of a new rating system and a wider suite of data and indicators for public schools in 2017 has the potential to allow policy makers to more systematically identify the greatest areas of difficulty, and highlight practices of schools that are successful despite adverse socio-economic conditions (Churchill, 2019[71]).
Given its ageing population and labour market shortages, Ohio more than many other US states needs to remove social barriers for access to and completion of post-secondary educational offerings. This arguably puts greater pressure on policy makers to work together to overcome social issues and contextual challenges that are not directly related to post-secondary education, but have an impact on the supply of available workforce, such as poverty, transportation, and problems of addiction.
Output from workforce programs related to post-secondary education has been flat in recent years, and there is some evidence of bottlenecks in selected fields
Ohio has put a heavy focus on workforce development in recent years, particularly following the establishment of the Governor’s Office of Workforce Transformation in 2012 (Box 4.2). The Office co-ordinates many innovative state-level initiatives to upskill the population, as well as Ohio’s participation in federal workforce development programmes. While workforce programmes make up a relatively minor component of overall education provision in the state, most programmes have at least some objectives that relate to post-secondary attainment. Workforce programmes also play an important role in improving access to education for under-represented and disadvantaged groups. For example, two key state-led policies are the Choose Ohio First Scholarship Program (see Section 4.3) and the Aspire Program for adult learners needing additional support to earn a post-secondary qualification (ODHE, n.d.[72]). The federal Workforce Innovation and Opportunity Act (WIOA) also provides funding for education and training to unemployed and under-employed young people in Ohio; one of its objectives is to increase post-secondary attainment (Ohio Department of Jobs and Family Services, 2017[73]).
Available data on workforce development initiatives indicate that the scale of provision in many of the state’s core workforce alignment programmes is likely to make only a modest impact on overall post-secondary attainment. Furthermore, in some programmes, completions have decreased since monitoring of the programmes began in 2012. For example, completions in the Choose Ohio First initiative peaked at 1 257 in 2014/15, and reduced to 731 by 2016/17 (Figure 4.10). Completions in apprenticeships also remained flat, at around 1 500 annually, over the period 2012/13 to 2016/17.
Figure 4.10. Completion trends in key workforce initiatives in Ohio, 2013-17
Note: Data on completions for the ASPIRE Program in 2016/17 are not currently available.
Source: OWT (n.d.[74]), Workforce Success Measures, https://workforcesuccess.chrr.ohio-state.edu/home.
Decreasing or even stable trends in completion across workforce programmes linked to post-secondary education provision is a potential cause for concern, given the current state-wide focus on workforce development, and on post-secondary attainment. It could indicate that despite the existence of well-designed initiatives and the multi-dimensional approach to workforce development in Ohio (as outlined in (Governor’s Office of Workforce Transformation, 2019[75])), workforce programmes may not currently have the capacity needed to increase their contribution to meeting current and future skills needs in Ohio. It appears that completion rates in programmes targeting populations with traditionally lower levels of educational success (such as the ASPIRE Program) may also not be scaling up over time, although future growth in labour market supply in Ohio depends partially on the ability of the state to harness talent from these population groups.
Other types of bottlenecks also may restrict growth in attainment. For example, there is some evidence that individual institutions are not always in a position to add capacity to their educational offerings, even when there is demand by qualified students and the labour market. In nursing, an occupation in current and future high demand, and experiencing shortages, the OECD review team heard from institutional representatives that qualified candidates are not able to access places in some programmes in public institutions, because of faculty shortages and a lack of available placement spots in hospitals. Faculty shortages are likely to become more acute in high-demand fields in future years, as the current workforce ages and higher education institutions have to compete to a greater extent with industry for staff (Pritchard et al., 2019[76]). Relatively low general public funding levels to institutions may also limit their ability to expand capacity (see Section 4.3).
The long-term value of post-secondary credentials
Most graduates in Ohio enjoy a positive return on attaining post-secondary education, even when taking above-average student debt levels into account
US and international evidence show a strong relationship between higher education attainment and enhanced rates of labour market participation (OECD, 2019[63]; U.S. Census Bureau, 2019[26]). This is also the case in Ohio, where higher education graduates have considerably better employment prospects than those with upper secondary education, and better integration into the labour market than the US average. Labour force participation rates for both the workforce as a whole and for younger adults rise progressively for each level of post-secondary credential achieved. Participation in Ohio is particularly strong for graduates with a bachelor’s degree; 92% of bachelor’s graduates aged 25-34 participated in the labour force in 2018, higher than the U.S. average (90%) and far above the OECD average (88%) (U.S. Census Bureau, 2019[26]).
Employment rates for graduates with all types of post-secondary education are above the US average in Ohio, and above the rates of the other three states participating in the review. The employment benefits of attaining an associate’s degree also appear to be stronger in Ohio than in most other US states; the employment premium gained by those with an associate’s degree is higher than the US average. The gap in labour force participation rates between graduates with associate’s degrees and those with bachelor’s degrees is also smaller in Ohio than in the other three states in the review. This underlines the generally favourable outlook for post-secondary graduates in the tight labour market in Ohio.
Earnings for graduates with post-secondary education in Ohio also increase with each successive level of education achieved, compared to those without a post-secondary education. The median salary of 25-64 year-olds in Ohio with some college is USD 2 000 higher than that of high school graduates, while the median salary premium is USD 5 000 for achieving an associate’s degree, and USD 20 000 for achieving a bachelor’s degree (Figure 4.11).
Figure 4.11. Median annual pre-tax earnings by level of education and age group, 2018
Note: Data refer to the earnings of full-time employees.
Source: U.S. Census Bureau (2019[26]), American Community Survey 2018 (database), https://www.census.gov/programs-surveys/acs/data.html.
For the younger population aged 25-34, Figure 4.11 shows that the financial benefit of achieving “some college” is less evident in the data. This reflects national trends, where cumulative additional earnings of those with some college (net of foregone earnings and costs of attending college), only begin to exceed the earnings of high school graduates on average once a graduate reaches their mid-30s (Ma, Pender and Welch, 2019[77]). However, young Ohioan graduates in this age group with degrees are generally already earning a substantial wage premium compared to peers with high school education, starting with a median wage USD 5 000 higher for those that have achieved an associate’s degree, rising to more than USD 16 000 higher for those with a bachelor’s degree (Figure 4.11).
Additional employment and earnings gains from post-secondary education need to be considered with respect to the cost of higher education and the impact of individual student debt accrued during study, important factors to take into account when assessing the overall returns to post-secondary education. Although state regulation has imposed caps in tuition fee increases in public higher education institutions, tuition fees in public 2-year and 4-year institutions in Ohio remain above the US average. In 2017/18 tuition fees in public four-year colleges were USD 10 026 (16th highest in the US) while tuition fees in public 2-year colleges were USD 3 672, slightly above the national average of USD 3 243, though below the US median of USD 3 891 (SHEEO, 2019[78]). Graduates are also more indebted in Ohio than on average in the United States. Average student debt at public and private not-for-profit 4-year institutions in 2018 was USD 30 323, slightly above the national average (USD 29 200) and 18th highest in the United States. Ohio also had the 16th highest share of students graduating with debt in the United States in 2018 (60%) (TICAS, 2019[79]).
U.S. Department of Education College Scorecard data for institutions in Ohio show that, as expected, both debt and returns on attending college vary by type of institution. In general, graduates from institutions that predominantly award certificates have lower debt levels and lower median earnings 10 years after enrolment, while graduates from institutions that predominantly award bachelor’s degrees have higher median 10-year earnings along with higher levels of debt (Figure 4.12). These two sets of institutions form distinct clusters, while the group of institutions that predominantly award associate’s degrees show a more varied set of outcomes, with some having debt and earnings levels similar to certificate-awarding institutions, and others showing 10-year earnings similar to some predominantly bachelor’s institutions, with generally lower levels of debt.
Nevertheless, evidence suggests that despite debt levels, college still pays off overall for a majority of students, despite the variety of earnings outcomes. A 2019 report by the Georgetown Center for Education and the Workforce based on the 2019 U.S. Department of Education College Scorecard indicates that, in general, a college education is still a worthwhile investment, especially when considered over a long-term time horizon. Qualifications from community colleges and some short-term credentials are associated with good relative earnings in the short-term, while institutions that primarily award bachelor’s degrees are associated with the highest earnings in the long term (Carnevale, Cheah and Van der Werf, 2019[80]). For Ohio, estimates using a metric of Net Present Value (NPV) of future earnings4 show that potential earnings over 40 years for graduates of post-secondary institutions in Ohio range from USD 343 000 to USD 1 519 000, depending on the institution (Carnevale, Cheah and Van der Werf, 2019[80]). In total, 163 of the 225 institutions show a 40-year NPV of their programmes of over USD 600 0005.
It is also important to take into account the wider benefits of higher education, beyond financial returns. Across the OECD, graduates with a higher education degree on average tend to enjoy a range of more positive social outcomes, compared to their peers without a degree (OECD, 2019[81]). While no specific studies on social benefits of higher levels of education appear to have been carried out in Ohio, in the United States as a whole, college graduates are more likely to vote, take on voluntary work, exercise regularly and engage in educational activities with their children (Ma, Pender and Welch, 2019[77]).
Figure 4.12. Median earnings and median debt of graduates of Ohio post-secondary institutions, by type of institution
Notes: Earnings and median debt are in USD. Only institutions with available data on both median earnings 10 years after enrolment and median debt at graduation are included in the figure. Institutions whose data is suppressed for either of these variables for privacy reasons were excluded. In total, 222 of the 317 institutions contained in the 2019 College Scorecard are included in the figure. The debt figure used covers only the debt of those who graduated with a qualification and does not include the debt of those who did not complete their course of study.
Source: Adapted from U.S. Department of Education (2019[82]), College Scorecard (database), https://collegescorecard.ed.gov/data/.
Some groups of graduates achieve less favourable labour market outcomes and face a more uncertain future
As discussed in previous sections, overall returns on investment in post-secondary education in Ohio remain positive, and the skills shortage and tight labour market mean that job prospects are generally favourable for those who invest in post-secondary education. Nevertheless, a large body of evidence demonstrates that post-secondary credentials in Ohio differ vastly in terms of their value to employers and ability to produce favourable labour market outcomes, depending on the type of institution and credential awarded, the field of study, and the industry of employment.
Labour market outcomes data show that some types of institutions and credentials produce poorer labour market outcomes on average. For example, the vast landscape of non-degree credentials encompasses credentials with sizeable labour market returns, as well as those that employers either do not value or do not recognise (ExcelinEd and Burning Glass Technologies, 2019[83]). US Gainful Employment data for non-degree credentials in public and not-for-profits in Ohio, and all credentials in for-profit institutions, illustrate the wide spectrum of possible returns on these credentials. Annual earnings rates are in general most favourable for public and private not-for-profit institutions, while for-profit institutions have the highest ratios of debt-to-earnings (Table 4.8). In particular, the average ratio of debt-to-earnings across for-profit 4-year institutions was just above 9%, the “pass” benchmark set by the Gainful Employment legislation6.
Table 4.8. Average debt-to-earnings annual rate for non-degree credentials, by type of institution
Note: The debt-to-earnings annual rate is the ratio of the median annual Title IV loan payment amount, for all student loans, incurred by students who completed the Gainful Employment (GE) Program compared to those former students’ average annual earnings. The median annual loan payment amount is based on the median of the student loan debt incurred by students who completed the GE program, amortized over 10 years for certificate and associate’s degree GE Programs, 15 years for bachelor’s and master’s degree GE Programs, and 20 years for graduate doctoral and first-professional degree GE Programs. Earnings are based on actual average earnings using the most recently available data from programme completers in the previous three academic years, based on U.S. Social Security Administration records.
Source: Office of Federal Student Aid (2017[84]), Gainful Employment Data: 2015 cohort (database), https://studentaid.gov/data-center/school/ge/data.
The share of post-secondary students in private for-profit institutions across the United States has been on a downward trend since 2010, and the share in Ohio is less than 5%. Evidence suggests that for the average student, for-profit education does not pay off (Cellini and Turner, 2019[85]) and can contribute to the persistence of socio-economic disadvantage (Gelbgiser, 2018[86]). Previous studies have shown credentials from private for-profit institutions in the United States appear to be valued less by employers than credentials from public or private not-for-profit institutions (Deming et al., 2016[87]). The generally poor outcomes in Ohio for graduates from for-profit institutions even in the tight Ohio labour market also indicate that qualifications from these institutions are not meeting employer needs (Halbert, 2017[88]). State authorities therefore have a role to play in ensuring that clear and accessible information is available to students on labour market outcomes, particularly for this sector of provision (see Section 4.3).
The extent to which graduates use the skills they acquire in the labour market also varies according to their field of study and the industry they enter after graduation. At the bachelor’s level, graduates from some fields are less likely to be employed following graduation. For example, employment rates of liberal arts bachelor’s graduates are below the average employment rates for bachelor’s graduates in Ohio (see Chapter 3). Liberal arts graduates also have lower earnings than the median levels overall for bachelor’s graduates in Ohio (USD 40 000 compared to the average of USD 50 000). However, a recent national-level study also indicates that while short-term returns to liberal arts degrees are relatively low, the long-term returns for liberal arts colleges are higher than those of many other types of four-year institutions in the United States (Carnevale, Cheah and Van Der Werf, 2020[89]).
For other types of credential, labour market returns and the earnings premium provided by each successive level of education can vary substantially by both field of study and industry of employment. As discussed in Section 4.2, from 2009-18 the largest rate of growth in post-secondary education awards has been in certificates of less than one year of duration. Studies carried out across the United States provide a mixed view of whether certificates in general provide positive labour market returns over and above a high school diploma (Dadgar and Trimble, 2015[90]). Nevertheless, many openings in high-demand fields require certificates. Shorter-term programmes leading to a certificate can also broaden access to post-secondary education and provide pathways to higher levels of post-secondary education.
The returns to certificates and associate’s degree are linked heavily to the field of study, given that these qualifications are often heavily oriented toward specific occupations (Georgetown Center on Education and the Workforce, 2020[91]). State-level data show that for some fields of study and industry combinations, certificates appear to be associated with similar earnings to associate’s degrees in the years after graduation, while for other fields an associate’s degree achieves superior earnings. For example, the earnings level and trajectory of those with business-related credentials entering the retail industry are similar for certificates and associate’s degrees, while those with associate’s degrees in health professions earn a considerable premium over those with a certificate (Figure 4.13).
Figure 4.13. Median pre-tax salary of post-secondary graduates by selected field of study and industry in the six years after graduation
Source: Adapted from Ohio Education Research Center (OERC) (2020[92]), Higher Education Outcomes Dashboard, https://oerc.osu.edu/higher-ed-outcomes.
At the same time, even graduates with qualifications in the same broad field show steadily poorer labour market outcomes in certain industries of employment. Figure 4.14 shows that graduates with business-related credentials appear to have consistently poorer earnings when they enter the accommodation and food service industry, and, for certificate graduates, the retail trade and administrative support industries. In each of these cases, even at six years after graduation, the median earnings of the 2011 cohort were far below the median earnings for Ohio high school graduates in 2018. On the other hand, the median salary for graduates entering the manufacturing industry immediately after achieving a credential is at least 20% higher than the median high school salary. Many certificate qualifications in this field also appear highly valued in some industries; the highest earnings overall for graduates with business-related sub-baccalaureate qualifications are for those with certificates working in either the professional, scientific and technical industry (USD 46 900) or the finance and insurance industry (USD 50 700).
Figure 4.14. Earnings by industry for graduates with qualifications in business, management, marketing and related services, one and six years after graduation
Note: The median income for high school graduates refers to the 2018 full-time full-year pre-tax earnings of adults in Ohio with high school education as the highest level achieved.
Source: Adapted from OERC (2020[92]), Higher Education Outcomes Dashboard, https://oerc.osu.edu/higher-ed-outcomes.
Further investigation would be required to ascertain whether less valuable subfields within the broader field, local labour market conditions or study programme quality are the determinants of poorer outcomes. As Ohio works to accelerate expansion of the output of credentials of all types to meet the attainment goal, the state will also need to find a mechanism to concurrently evaluate credentials and ensure they are providing adequate outcomes for graduates. The challenge is further complicated by the fact that many in-demand jobs are in roles that are socially necessary, but with relatively poor earnings (such as nursing assistants, healthcare assistants and childcare staff). While higher education policy has very limited scope to influence labour market outcomes for these categories of credential, the wider workforce policy network in the state will need to ensure that appropriate incentives are in place to create a steady pipeline of workforce for these jobs into the future.
4.3. Policies to improve the alignment of the higher education system and the labour market in Ohio
The three key challenges relating to the supply of high-level skills and graduate outcomes in Ohio identified in the previous section have implications for the design of policy in the state. In particular, Ohio law makers and policy makers would be well advised to take steps to:
1. Increase the overall volume of graduates in high-demand fields, including through ensuring accessible, relevant, high-quality study options aligned to skills requirements are in place, communicating about and incentivising access to higher education, and ensuring students are supported to complete credentials.
2. Address the specific needs of non-traditional student populations through high-quality and joined-up services to support first generation and disadvantaged student groups (non-traditional learners) to access and progress through higher education. This includes making study affordable and physically accessible.
3. Help students to make good choices by providing clear information and advice to allow individuals to make decisions based on knowledge of likely labour market outcomes when choosing programmes, courses and majors.
In reality, these three policy priorities are strongly related and will need to be addressed with a combination of distinct policies. This section of the chapter assesses how well the current policy environment in Ohio is responding to the priorities identified and provides recommendations on how policies might be strengthened. It first considers the way in which overall strategy is set and policies co-ordinated. It then assesses specific state policies governing the educational programmes offered in Ohio, pathways for students between programmes and non-financial support to help students enter and complete higher education. The final sections of the chapter look at higher education funding – and the impact this has on affordability and relevance – as well as policies on the collection, dissemination and use of data on skills production and labour market outcomes.
Strategic planning and co-ordination
Strategic goals and strategies can provide a vision of how higher education should contribute to workforce needs and the kinds of actions that are needed to achieve this objective. Overarching goals and state-wide strategies have the potential to focus the efforts of the multiple actors involved in aligning higher education and workforce needs, including higher education institutions, state agencies and employers. Alongside statements of intent, leadership is needed to drive actions forward and practical mechanisms are required to co-ordinate the activities of different bodies involved in policy development and implementation.
Current and past Ohio administrations have prioritised workforce development and created structures to co-ordinate policy across state agencies
Ohio’s current Governor has identified workforce development as a key priority, building on an established tradition of strongly developed workforce policy in the state. At the centre of state government, under the direct responsibility of the Lieutenant Governor, the Governor’s Office for Workforce Transformation (OWT) seeks to co-ordinate Ohio’s skills and workforce policies (see Box 4.2). Advised by the Governor's Executive Workforce Board, composed of leaders in business, education, and workforce development, and under the leadership of the Governor and Lieutenant Governor, the OWT establishes overall strategy for workforce development in Ohio and co-ordinates with Ohio’s state agencies involved in workforce policy.
The state’s commitment to workforce development is also reflected in the organisational structure of the Ohio Department of Higher Education (ODHE), which has a specific Vice Chancellor post and staff team for workforce alignment. This is unique among the four states taking part in the current project. ODHE’s workforce alignment team co-operates directly with the Governor’s Office for Workforce Transformation, which helps to create coherence in policy making at the operational level. Moreover, as will be discussed in Section 4.3, Ohio has created mechanisms to share and pool administrative data from different state agencies dealing with education, employment and workforce policies, creating a shared information resource across the related policy areas.
Ohio’s Workforce Transformation Strategy establishes overarching priorities for skills development, although focuses relatively little on post-secondary education
In 2018, under the previous governorship, the Governor’s Office of Workforce Transformation, working with the Governor's Executive Workforce Board, co-ordinated the development of a state workforce development strategy entitled “Workforce 2.0” (OWT, 2018[18]). As summarised in Box 4.4, this strategy established broad goals for workforce development, each linked to specific actions, with a strong focus on promoting co-operation between education and employers.
Box 4.4. “Workforce 2.0” – Ohio’s Workforce Transformation Strategy
Against a backdrop of an ageing population, regional disparities in employment opportunities and stagnant population growth, Ohio’s Workforce Transformation Strategy sets out to help “connect Ohio’s business, training, and education communities” and “to attract and build a dynamically skilled, productive, and purposeful workforce that can compete globally to meet the needs of Ohio’s businesses and diverse economies”. The specific goals of the strategy, each associated with actions, are:
1. “Connect Business and Education” by supporting community-based partnerships, aligning education and business priorities to meet workforce demand and developing methods to determine and meet workforce supply and demand.
2. “Create a Culture of Continuous Learning” by leveraging Ohio’s public library system for workforce development and increasing educational attainment “in alignment with in-demand jobs” (this includes contributing to the 65% post-secondary attainment target).
3. “Build Career Pathways” by working with the business community to strengthen vocational training, increasing opportunities for those with disabilities and ex-offenders, and allowing students to earn credit for work, competency, and career-based experiences.
4. “Leverage Data for Accountability” by exploiting data for policy making, enabling more efficient data sharing and evaluating results of programmes “to ensure continuous improvement”.
5. “Coordinate Workforce Efforts” by aligning workforce-related efforts with other state entities and with federal workforce efforts, and by creating awareness of best practices.
Source: OWT (2018[18]).
Workforce 2.0 includes a commitment for all state agencies to contribute to the goal established by the Ohio Board of Regents in 2015 of achieving 65% of Ohio’s adult-age workers with a degree, certificate, or other “credential of value” by 2025 (Ohio Board of Regents, 2015[51]). As discussed earlier, this attainment goal, adopted in recognition of the need to increase the supply of qualified graduates to the Ohio labour market, has guided policy making in higher education in Ohio in recent years.
Despite the inclusion of this reference to the 65% goal, it is striking that Ohio’s Workforce Transformation Strategy contains relatively limited reference to post-secondary education and few specific actions in the sector. Specific actions in the area of higher education relate to certificate programmes, including focusing the now-discontinued OhioMeansJobs revolving loan fund on certificate programmes that align with in-demand jobs, conducting an inventory of such programmes, and taking action to create more career and technical education (CTE) programmes at the post-secondary (and secondary) level. Most other specific actions target those seeking secondary-level qualifications and/or participating in workforce programmes.
The priorities and actions included in Ohio’s workforce strategy do respond to the pressing need to ensure a higher proportion of the population gains good quality secondary-level education and training. The actions in the current strategy are those most closely associated with traditional “workforce policy” in Ohio and the United States more generally. However, given the demand for post-secondary qualifications outlined in the previous sections, there is scope to include a greater focus on boosting post-secondary attainment aligned with workforce needs in future iterations of the strategy.
There have been numerous state-level initiatives to support post-secondary attainment, but some have lacked scale or continuity, and evaluation of effectiveness is limited
Notwithstanding the limited references to actions to promote post-secondary attainment in “Workforce 2.0”, Ohio has implemented a wide range of policies and programmes to encourage more people to enter and complete higher education and to encourage credential acquisition in high-demand fields. Current initiatives are discussed in the next sections of this chapter. Nevertheless, two general points about the design and implementation of policies in the area of higher education-workforce alignment emerge from discussions with stakeholders in Ohio and analysis of current policy.
First, policy activity in the area of workforce transformation in Ohio in recent years, often at the initiative of the Legislature, has yielded a large number of distinct initiatives of varying duration. While the targeted student scholarship programme Choose Ohio First (see below) has existed since 2008, other initiatives such as the Ohio Means Internships and Co-ops (OMIC) programme received funding support for four years and appears to have lacked the critical mass of resources to achieve scale and widespread impact. While some degree of experimentation is welcome, frequent changes in policy programmes risk creating administrative burden and “reform fatigue” at the level of institutions. Each new reform effort requires extensive investment of resources by state authorities to raise awareness among institutions and the general public about the programme, and among institutions to learn about the parameters of new programmes and make applications for resources. As a general principle, it would be advisable to adopt a more long-term approach to policy making, aimed to ensuring stability, effectiveness and efficiency. This would be in line with the principle expressed in “Workforce 2.0” of “creating sustainability and longevity of best practices through future administrations” (OWT, 2018[18]).
Second, there is no evidence of systematic evaluation of policy and spending programmes to assess effectiveness and inform design of future initiatives and reforms. This is also a challenge highlighted explicitly in “Workforce 2.0”. More specifically, programmes appear to be established without a clear explanation of how they relate to other state initiatives, while independent evaluations of funding initiatives are not generally conducted. Developing evaluation plans as part of policy development and more systematic monitoring and evaluation would provide a stronger evidence base for law makers and policy makers to use to guide future decisions.
Higher education institutions have developed Campus Completion Plans to help reach state workforce goals, but these are less comprehensive than in other states
At the same time, as the adoption of the 65% post-secondary attainment goal, in the operating budget for the 2014/15 biennium, the General Assembly included a requirement for public higher education institutions to adopt “Campus Completion Plans” and submit these to the ODHE (ODHE, 2019[93]). These plans were conceived as a means to provide a continuous improvement framework to allow campuses to identify and implement strategies to increase the number and proportion of students earning post-secondary credentials. Public institutions were further required to update these plans every two years.
The detail and scope of Campus Completion Plans appear to vary widely. While all plans appear to focus on completion rates, some also report on efforts to align programme offerings more closely to workforce demand. Although the submission of updated plans every two years is a legal requirement, it is not clear how the plans are assessed or their implementation monitored by the ODHE. Furthermore, no financial resources are explicitly attached to the development of the plan or the implementation of the strategies in them. This contrasts with the situation in some other states, such as Virginia, where such institutional plans are used more actively as a means to align institutional and state strategies, and funding (albeit limited) is awarded to institutions for specific initiatives within the plans.
Recommendations for strategic planning and co-ordination
1. Ensure the 65% post-secondary attainment goal is strongly emphasised in the implementation of Ohio’s broader workforce strategy and in any potential future revisions to “Workforce 2.0”. Given projected demand for advanced skill sets in the state, Ohio’s overall skills strategy will need to create and promote as many opportunities as possible for different population groups to transition to post-secondary study options. Ensuring opportunities to access relevant industry certificates and cost-effective associate degrees will be particularly important in reaching first generation and disadvantaged student populations.
2. Ohio law makers should base decisions on future policies and programmes to support workforce alignment in post-secondary education on careful analysis of potential impact, and aim to ensure the continuity of successful initiatives. While small-scale interventions may be justified to test new concepts or innovative approaches, careful consideration should be given to the level of resourcing required to achieve impact and the administrative burden of each new initiative for higher education institutions, employers or other beneficiaries.
3. State authorities should build more detailed evaluation strategies into the design of policy initiatives and commission independent evaluations of existing policies and programmes.
4. Ohio law makers could consider introducing a requirement for more comprehensive institutional development plans for public institutions, integrating existing reporting on labour market outcomes of graduates and campus efforts to promote alignment with labour market needs (in addition to the actions already reported on attainment). Institutional initiatives in Campus Completion Plans could potentially be linked to small-scale targeted state funding to complement the core, performance-based funding model (see Section 4.3).
Student supports and pathways
In higher education systems with a strong tradition of institutional autonomy, such as those in the United States, higher education institutions and faculty make most of the crucial decisions on which educational programmes to offer and how they are offered. Public authorities nevertheless take actions that influence the provision, design and delivery of post-secondary educational programmes, the way different programmes relate to one another and the way students are encouraged to enter and move through the post-secondary system. The way they do this can have an impact on the ability of the system to meet the students’ needs for knowledge and skills, and to respond effectively to workforce demand.
In Ohio, as elsewhere in the United States, higher education institutions must comply with the standards of recognised regional or national accrediting bodies to receive funds from the federal student aid budget. As elsewhere, Ohioan state authorities have no direct role in accreditation, but do implement a rigorous system of authorisation of private providers and approval of new degree programmes in all higher education institutions in the state. They also enact rules and standards governing the co-ordination between different programmes and the options students have to transfer between them. Targeted state initiatives have also been used in Ohio to promote work-based learning opportunities for post-secondary students and to provide additional personal support for prospective students, who are deciding whether and what to study, and existing students, who may need help in navigating through higher education.
This section considers these various aspects of state policy and their potential to support alignment between higher education and workforce needs.
State authorities take into account evidence of workforce alignment in approval of new academic programmes, but have few mechanisms to monitor existing provision
The Chancellor of the Ohio Department of Higher Education is responsible for authorising independent (not-for-profit and for-profit) and out-of-state institutions to provide academic credit in the state, as well as for approving all new academic programmes and majors in public and private institutions. Institutions are also required to gain approval for substantial changes to existing programmes, although these “change requests” are usually handled at an administrative level by ODHE staff. This system of authorisation and approval means Ohioan public authorities have a direct say in steering the development of the academic post-secondary educational offerings in the state, even if primary responsibility for programme design and delivery rests with each institution. The state-level authorisation and approval processes required all institutions submitting proposals to be accredited by Ohio’s regional accrediting body (the Higher Learning Commission (HLC)) or national accrediting agencies.
Box 4.5. Workforce relevance criteria in academic programme approval in Ohio
Ohio’s general standards for approval of academic programmes include general requirements relating to the broad institutional environment for the programme, including external accreditation; mission and governance; resources and facilities; student support services; and faculty. Specific standards relating to the programme to be approved examine the coherence and content of the proposed curriculum, assessment, online learning and the programme budget, resources and facilities. As part of the consideration of the curriculum, the programme approval examines, where appropriate, if programmes include capstone experiences or culminating projects related to the needs of the workforce, internships or co-op opportunities and experience with technologies relevant to specific professions.
In addition, the general standards require institutions to demonstrate evidence of “workforce relevance, need and student interest”. Proposals or change requests must present evidence of: collaboration with employers, students’ potential for employment on graduation, and the competitive advantage of the submitting institution in providing the programme. In addition, public institutions must demonstrate that the proposed programme is not unreasonably duplicative of other programmes in the state and is aligned with state policy initiatives. Evidence may include local, state and national labour market research, demographic analysis, evidence of partnerships with business and industry (such as secured opportunities for co-ops and internships, or provision of adjunct faculty or mentors for students) or pilot courses or certificate programmes with a history of success, demonstrating the need and opportunity for a full degree.
Source: ODHE (2016[94]).
Detailed General Standards for Academic Programs (ODHE, 2016[94]) have been established, which are used to guide programme approval processes. These standards include consideration of the proposed programme curriculum and, as set out in Box 4.5, a requirement for institutions submitting proposals to demonstrate the labour market need for the programme. For the approval of new programmes and majors, following initial contacts with the ODHE, public institutions submit proposals to the ODHE, which are subsequently subject to a peer review by content experts from Ohioan public universities and colleges. The ODHE then works with proposing institutions to resolve concerns identified and makes a decision on whether to refer the proposal to the Chancellor for approval. Proposals that are recommended for approval are subject to a period of public comment before final approval by the Chancellor. For private for-profit private institutions and non-for-profit institutions that have been continuously accredited for less than 20 years, the approval process for new programmes additionally involves a site-visit to the proposing institution by reviewers appointed by the ODHE. Not-for-profit institutions that have been continuously accredited for over 20 years follow essentially the same procedure as public institutions.
The current Ohio system for evaluating the workforce relevance of new programme proposals incentivises higher education institutions to pay close attention to skills demand and workforce development issues in planning and implementing new educational programmes, or in making major revisions to existing programmes. As such, it is likely to contribute positively to the state’s overall higher education attainment and workforce alignment goals.
It is also noteworthy that the Higher Learning Commission, the regional accreditation body covering Ohio, has recently changed the language in their criteria for accreditation and now calls for institutions to demonstrate that their curricular and co-curricular activities prepare students for “informed citizenship and workplace success” (HLC, 2019[95]). Although the emphasis on the workforce-relevance of programmes and institutional procedures within HLC accreditation procedures remains modest and renewal of HLC institutional accreditation is generally required only every 10 years, HLC staff consulted by the OECD argued there was a shift towards greater focus on these issues within the accreditor and accreditation teams. This is likely to complement state-level efforts to increase emphasis on skills needs and workforce relevance through programme approval.
Despite the focus on workforce issues in the up-front authorisation and approval process and – to a limited extent – accreditation, there is no systematic monitoring of the labour market outcomes achieved by graduates from established programmes. State-level monitoring of the performance of existing programmes is restricted to analysis of basic efficiency measures and ongoing monitoring of the accreditation status of institutions. In common with states such as Virginia, public institutions in Ohio are required to report regularly on programmes that have low enrolment or duplicate others in the public system. Where enrolment in a programme falls below certain levels (with thresholds determined by each institution) or programmes are found to replicate others in the same region, public institutions are required to propose solutions, such as sharing courses across different campuses (Ohio General Assembly, 2017[96]).
The ODHE procedures for programme approval do set out requirements for maintaining approval, but for public and long-established not-for-profit institutions, these simply call for institutions to report on the results of accreditation processes by the HLC or other accrediting bodies (ODHE, 2016, p. 47[94]). The standard periodicity for HLC accreditation is every 10 years. In the case of for-profit and newer not-for-profit private institutions, the ODHE may nominate a representative to accompany the institutional site visit by the HLC or other accrediting body. As in other states examined in this review, the question arise as to whether more can or should be done to monitor the workforce-relevance of established post-secondary programmes.
Ohio has enacted a particularly comprehensive set of policies to promote articulation and transfer between levels of education and programmes
Ohio has implemented a range of credit accumulation and recognition policies to help students transition between different levels of education and programmes. The state’s “Articulation and Transfer Policy” (ODHE, 2019[97]), encompasses initiatives to allow students in secondary and technical education to gain credits that count towards post-secondary qualifications, as well as rules governing transfer of students between public higher education institutions.
As in other states, Ohio has a system of Advanced Placement (AP) in high schools, which allows students to gain learning credits that can subsequently count towards college-level general education requirements. Similarly, like other states, it also has a system for dual enrolment – College Credit Plus (CCP) – which allows students to enrol in college and take college-level courses while simultaneously completing their high school education. In addition, Ohio policy promotes articulation between specific courses in high school and technical colleges and related college-level programmes. Bilateral articulation agreements between certain schools and partner colleges and universities provide written assurance that courses completed in a secondary programme will count for credit at a particular college or university that offers a programme in the same field. For students in Career and Technical Education (CTE), state authorities have adopted Career-Technical Assurance Guides (CTAGs), which define guidelines for specific CTE programmes for which, by law, all public colleges and universities are required to award post-secondary credit (ODHE, 2020[98]; Poiner, 2018[99]).
Articulation and transfer policy within the higher education sector has focused on transfer between two-year and four-year institutions. Ohio introduced the first elements of a systematic articulation and transfer policy in 1990, with the development of the Ohio Transfer Module (Box 4.6). Since then, policy in this area has been further developed and strengthened, with a strong focus on guaranteeing credit recognition and transfer pathways. State legislation adopted in 2015 required the Chancellor of Higher Education to establish state-wide guaranteed transfer pathways from two-year to four-year degree programmes in public institutions in an equivalent field (Ohio General Assembly, 2015[100]). A new system of guaranteed transfer pathways is currently being implemented across the public college and university system, under the co-ordination of the Ohio Department of Higher Education (Box 4.6).
Box 4.6. Ohio’s policies for articulation and transfer within higher education
The Ohio Articulation and Transfer Network (OATN), a dedicated team of staff within the ODHE, co-ordinate the development and implementation of Ohio’s post-secondary articulation and transfer policy across Ohio’s public university and college system. Under the supervision of an oversight board composed of senior representatives from higher education institutions, the OATN co-ordinates the work of faculty in public higher education institutions in developing and applying standards for curriculum requirements, advising, credit recognition and guaranteed pathways. Key components in the articulation and transfer system include:
The Ohio Transfer Module (OTM): a standard set of general education learning outcomes corresponding to core elements of the general education component of associate’s and bachelor’s degree programmes. Each public institution has an OTM specified according to state-wide guidelines, and OTMs completed in all public institutions are recognised as equivalent and automatically accepted for credit accumulation on transfer between institutions.
Transfer Assurance Guides (TAGs): discipline-specific guides that specify the content and combination of courses (called “TAG courses”) that students need to take to be able to transfer efficiently to specific majors in public four-year institutions. Career-Technical Assurance Guides (CTAGs), designed on the same principle, perform a similar role for transfer between Career and Technical Education (CTE) to college-level credit programmes.
Ohio Guaranteed Transfer Pathways (OGTPs): a more recent initiative, building on the OTM and TAGs, to create coherent, pre-defined sets of courses in two-year colleges that lead to associate’s degrees that are automatically recognised for transfer into specific majors in four-year public universities. OGTPs are being developed by faculty in public institutions in eight main disciplinary areas, and institutions are stepping up student advising activities to help more students decide on learning goals early and select the right course combination to allow efficient transfer to bachelor’s-level study.
Sources: ODHE (2019[97]; 2020[101]).
It is clear that Ohio has developed a highly sophisticated system of policies and initiatives to promote articulation and transfer between the state’s public colleges and universities. The state Legislature has taken a keen interest in the issue and has legislated to require articulation and transfer to a greater extent than in other states involved in the United States labour market relevance project. The modular, flexible nature of higher education in the United States, which allows students more freedom to choose pathways than in many other OECD higher education systems, inevitably leads to students following more complex pathways. The articulation and transfer policy is an attempt to reduce this complexity by building clearer pathways, backed up with stronger steering and guidance for students. It is nevertheless evident, as illustrated in Box 4.6, that the highly developed nature of articulation and transfer policies in Ohio has itself created a complex system of distinct, but related components, which has the potential to create confusion for faculty, staff and students trying to navigate the system. There may be scope to streamline the system and reduce the number of distinct elements used as the new guaranteed pathways initiative is implemented.
It is challenging to assess the impact of Ohio’s articulation and transfer policies to date because of limitations in the publicly available data, the absence of a counterfactual situation with which to compare, and the wide range of external factors that influence individual students’ decisions to transfer between institutions. Data on the proportion of all enrolled students in public two-year colleges in Ohio who transfer each year to public four-year main campus show an increase in the transfer rate from 3.4% in 2012 to 4.0% in 2018 (Mustafa, 2018, p. 16[102]). In addition, about 2% of two-year students transfer to other public two-year colleges of regional campuses of public universities. In the same period, the average transfer rate from regional campuses – which have similar enrolment profiles to community colleges – to main public four-year campuses increased from 9.8% to 12.9%.
These low rates of transfer in part reflect the fact that only a minority of students enrol in community college and university main campuses with the intention of transferring to another institution. A cross-state analysis of two-year to four-year transfer rates restricted to degree-seeking students and using data from the National Student Clearinghouse found that 21% of such students from Ohio community colleges in the studied cohort transferred to a four-year institution with a completed associate’s degree (Jenkins and Fink, 2016, p. 20[103]). This rate of “transfer with award” is lower than the US average of 29% and the equivalent rates in states such as Florida, Virginia or Washington. Although the specific configuration of Ohio’s public higher education system, with its network of university regional campuses, may have affected the analysis, the study shows the importance of developing robust metrics for measuring transfer and of carefully monitoring the effects of articulation and transfer policy.
Despite past initiatives, state authorities currently provide limited support for work-based learning opportunities for students and workforce engagement by faculty
Ohio has a strong history of provision of co-operative education, particularly in fields related to the state’s historically dominant industries. The University of Cincinnati, in particular, was a pioneer in providing co-operative education for its students. In the state operating budgets covering 2014-17, the General Assembly provided a total of almost USD 20 million to support the expansion of co-operative education and other forms of work-based learning through the Ohio Means Internships and Co-ops Program. The available funds were allocated by the ODHE through requests for proposals, initially to individual higher education institutions and, from 2015, to consortia of institutions across the six JobsOhio regions. The funds were to be used to incentivise more students to pursue co-ops and internships in majors other than STEM (Science, Technology, Mathematics and Engineering), incentivise more businesses to hire student co-ops and interns, and enhance the capacity of campuses to organise and follow up internship placements.
The OMIC funded almost 6 500 internships and co-operatives across the state, and the grants are reported to have “catalyzed and accelerated efforts by campuses across Ohio to make work-based and experiential learning a priority” (ODHE, 2018[104]). Overall, the investment programme appears to have addressed a reality confirmed in interviews by the OECD that operating co-op and internship programmes effectively takes considerable time and effort on the part of faculty and staff. In particular, the process of identifying and working with employers to develop the ability to offer high-quality internships, interaction with businesses during internships, and follow-up and evaluation all require resources.
The OMIC programme did not receive further funding after the financial year 2017, so has effectively been wound up. Although the programme was most successful in promoting uptake of internships and co-ops in universities and employment sectors where internships were already common (ODHE, 2018[104]), it provided potentially valuable support to institutions and employers across the state. The OECD team does not know the exact reasons for the discontinuance of the programme. However, given the potential of internships and co-ops to strengthen students’ workforce-relevant skills and the strong support for internships heard from stakeholders during the OECD visit, there is a case for reintroducing state funding for initiatives in this area.
At the same time, institutional representatives consulted by the OECD team highlighted an increasing commitment on the part of academic staff to ensuring the relevance of programmes to workplace skills needs, and an increased focus on advising students about career choices and work-based learning opportunities. While there is variation between institutions and departments, there is a risk that academic staff become detached from industry practice and wider developments in the world of work outside of academia. Staff have limited opportunities to engage in their own experiential learning in organisations outside of their institutions to update their knowledge and build networks. Support for staff practice-oriented sabbaticals in organisations and businesses working in their fields could potentially be integrated into future state support for higher education-employer co-operation.
Supporting more people from disadvantaged backgrounds into and through higher education is a priority for Ohio, but the challenges are considerable
As discussed earlier in this chapter, Ohio is characterised by substantial regional disparities in household income and educational levels, with many comparatively deprived localities where college attendance rates remain low. Reaching the state’s ambitious 65% post-secondary attainment target implies bringing a large numbers of individuals from less advantaged backgrounds and communities with a limited tradition of college-going into higher education, and supporting them in acquiring qualifications. The barriers faced by these populations in entering and completing higher education in the United States, as elsewhere in the OECD, are well documented. They include inadequate academic preparation, limited information and parental support, an absence of role models, financial constraints, a lack of transport options and problems related to substance addiction.
Many local and regional initiatives led by higher education institutions, schools, community groups and municipalities seek to tackle the different barriers to higher education attendance. State agencies involved in regional and local development, such as the Governor's Office of Appalachia, have a strong focus on skills development (GOA, 2020[105]). In the 2020-21 biennium, the ODHE has secured around USD 6.5 million from the U.S. Department of Education’s Gaining Early Awareness and Readiness for Undergraduate Program (GEAR UP) to develop “college-going culture” in targeted schools and communities. The programme is funding consortia of educational institutions, bodies involved in college access and business partners to develop guidance and supports for students from low-income families. Four consortia are currently supported (ODHE, 2020[106]), with further funding planned. At the same time, the state has committed funds to the OhioCorps pilot project to help address the opioid crisis in low-income communities. Current higher education students will be trained and supported financially to mentor at-risk middle and high school students and help at-risk students' parents as part of a service learning component in their degrees (ODHE, 2020[107]).
Within higher education institutions, many stakeholders consulted during the OECD visit highlighted the considerable efforts being made to enhance student advising and entrust academic staff with greater responsibility for guiding students in study choice. Provision for student support and advising is considered in the programme approval system discussed above. As noted in the next section, the formulae for the state’s output-based institutional funding systems for public universities and community colleges incentivise institutions to support students at risk of non-completion. Moreover, the latest Ohio state budget calls on the Chancellor of higher education to establish a “community college acceleration program” to enhance financial, academic and personal support services to students in need of support from local social service agencies and help them access educational opportunities in the state’s public two-year colleges.
The OECD team was struck by the commitment of many of those involved in increasing engagement with prospective students and students from disadvantaged backgrounds; the various activities noted above involve many innovative and promising approaches. In light of the challenges the state faces, Ohio could expand its targeted efforts to reach out to non-traditional student groups through greater co-ordination and investments in larger-scale initiatives.
Recommendations on programmes, pathways and non-financial student support
1. ODHE should complement its up-front processes for approval of new academic programmes with monitoring and review of the outcomes achieved by graduates from each programme in terms of; a) employment in the one to five years following graduation or b) transition to further study. Ideally, such a system should take into account graduate earnings as a proxy indicator of job quality, while taking into account low average earnings in certain socially valuable graduate occupations. It is likely to be most efficient for this monitoring to occur centrally, using existing administrative and educational data sources. Such a review process could potentially occur on a three-year cycle, with higher education institutions called upon to justify or improve programmes with persistently poor graduate outcomes.
2. ODHE should maintain close working relations with HLC to ensure that Ohio’s priorities and concerns in relation to the labour market alignment of higher education are adequately heard in policy making and practice in the regional accrediting body.
3. Building on existing efforts by the Ohio Articulation and Transfer Network (OATN), ODHE should explore ways to streamline and simplify the existing landscape of articulation and transfer policies to ensure it is readable for students, faculty and staff. ODHE should also take steps to improve the evidence base for future policy making on articulation and transfer in the states. The Department should consider how more transparent reporting could be achieved on the effectiveness of existing policies in promoting transfer into and within higher education. In particular, it would be valuable to provide clear information on the proportion of students successfully transferring and gaining credit recognition and, where problems are detected, to analyse remaining barriers to transfer and credit recognition.
4. Building on the experience gained in the OMIC program, Ohio law makers should consider allocating new resources to develop the capacity of higher education institutions and employers to organise high-quality internship and co-op experiences for students. It will be important to consider how funds can be targeted more equitably across regions, to promote greater take-up in institutions, fields of study and parts of the state where such work-based learning experiences are less well established.
5. Potentially as part of a programme to support broader regional co-operation projects between higher education institutions and employers, Ohio law makers should consider making funding available to allow academic staff to spend time working or contributing to projects within organisations outside of their institutions (businesses, public sector agencies, cultural bodies, etc.) to develop their knowledge of contemporary working environments. An exchange model, where employers of the host organisations teach or otherwise contribute to academic programmes, could be envisaged.
6. Potentially under the co-ordination of the Governor’s Office for Workforce Transformation, ODHE and state agencies responsible for education, jobs and family services, and regional development should analyse how existing policies to increase uptake and completion of higher education among disadvantaged population groups can be streamlined, co-ordinated and funded. The objective should be to eliminate unnecessary fragmentation and put in place “joined-up” services for these population groups, with a view to reaching the state’s 65% attainment target.
Funding
From a theoretical perspective, the ability of higher education institutions to satisfy the knowledge and skills needs of students and the economy is likely to be influenced by funding levels and arrangements in three main ways:
1. The overall level of funds – from public and private sources – available to institutions for educating each student inevitably has an impact on the design, potential quality and likely relevance of provision, even if there is no universal and straightforward relationship between “more money” and “better” education. It is reasonable to assume that institutions with adequate funds will be better able to attract and keep qualified staff, deploy more resource-intensive instructional practices, provide higher quality facilities and equipment and devote more resources to student advising. If used effectively, these factors all have the potential for positive impact on students’ skills acquisition, preparation for the labour market and chance of graduating successfully. Determining the actual level of resources needed to ensure high-quality provision efficiently is, of course, notoriously difficult, and a challenge with which educational policy makers across the OECD struggle continuously.
2. The level of public funding available to institutions and students will affect the cost and affordability of study for students. This, in turn, is likely to influence the flow of students into (and through) the higher education system, and the ability of systems to meet attainment targets and skills demand. Institutional subsidies that allow institutions to charge lower tuition and fees and student financial aid to cover the costs of tuition, fees and living expenses all reduce the upfront cost of study for individuals. Studies from different OECD countries, including the United States, show that students and potential students from low- and middle-income backgrounds are particularly price sensitive and that higher study costs tend to reduce their likelihood of entering and completing higher education (Gallet, 2007[108]; Attanasio et al., 2011[109]; Dearden et al., 2011[110]).
3. The design of the mechanisms used to allocate funds to higher education institutions and students is likely to influence the behaviour of those receiving the funds. Higher financial awards for particular study options can influence students in their choice of study and institutions in their educational programming, potentially increasing the supply of graduates in high-demand fields. Earmarked funding streams and outcomes-based allocation formulae for universities and colleges can force or encourage institutions to devote resources and efforts to achieving specific goals related to labour market alignment.
The following section assesses the current situation in Ohio in relation to these three issues.
Total revenue per student in public higher education institutions in Ohio is around the US average and has held stable in real terms since the Great Recession
As elsewhere in the United States, Ohio’s public higher education institutions rely primarily on a combination of student charges (tuition) and appropriations from the state budget to fund their educational activities. Public institutions are not subject to specific enrolment caps imposed by public authorities and have some flexibility in determining the tuition and non-educational fees they charge students.
Data from the State Higher Education Executive Officers Association (SHEEO) show that the average educational revenue per full-time equivalent student (FTE) in public institutions in Ohio remained broadly stable between 2008 and 2018, at a level just below the average of all 50 states. Average educational revenue across all types of public institution rose by 2.1% in real terms over the 10-year period to almost USD 13 900 per FTE, compared to a 2018 US average of almost USD 14 600. The relative stability in revenue levels in Ohio in recent years contrasts with more dramatic changes in FTE revenue in public institutions in other states in the decade to 2018, ranging from increases of over 30% in Illinois and Colorado and decreases of over 10% in Louisiana, Nevada and Missouri (SHEEO, 2019[111]).
State spending on public higher education institutions in Ohio has historically been low compared to other states, and the net tuition paid by students comparatively high. For the financial year 2020, the State Share of Instruction (SSI) allocated to Ohio’s public institutions in the state budget amounted to just over USD 2 billion (Ohio General Assembly, 2019[112]). SHEEO’s comparative data for the financial year 2018, which also take into account specific allocations for medical studies and doctoral institutions, show an average state appropriation to public institutions of USD 5 700 per FTE. This is equivalent to around 73% of the 2018 nation-wide average, placing Ohio in bottom fifth of states in terms of state financial support to institutions. Between 2008 and 2018, state appropriations in Ohio fell by 9.4% in real terms, but this is a smaller fall than in many others states and below the nation-wide average of an 11.2% reduction (SHEEO, 2019[111]). As shown in Figure 4.15 below, educational appropriations to public institutions have recovered in recent years after reaching a low point during the financial year 2013, when, after adjusting for inflation, they were 25% below their 2008 level and 45% below the level seen in 2000.
As also illustrated in Figure 4.15, the fall in state appropriations after 2008 was compensated over time by an increase in average net tuition paid by students, in particular through a substantial rise in revenues from student contributions in 2012. Since then, however, average fee revenue has remained relatively stable, largely as a result of explicit tuition fee caps incorporated into biennial operating budgets by the Ohio General Assembly. In the current budget (2020/21), annual increases in tuition and general fees are limited to two percent for universities and regional campuses and five dollars per credit hour in community and technical colleges (Ohio General Assembly, 2019[112]).
The use of such fee caps in recent years marks a return to a long-standing policy of legislative fee moderation implemented before the 2008 crisis, and has allowed Ohio to limit tuition inflation comparatively effectively. Whereas average net tuition revenue in public universities and colleges nation-wide increased by almost 40% between 2008 and 2018, the equivalent figure for Ohio was around 12%. Despite this, average net annual tuition revenue in Ohioan public universities and colleges, at USD 8 160 in 2018, remains around 20% above the average of U.S. states (SHEEO, 2019[111]). The SHEEO data on net tuition revenue include income from graduate and out-of-state tuition and fees. Ohio’s own data show average annual “sticker price” tuition and general fees for in-state students for 2020 of around USD 4 800 in community colleges; USD 6 100 in university regional campuses; and USD 9 950 in university main campuses (ODHE, 2019[113]).
Figure 4.15. State appropriations and tuition revenue in public higher education institutions, 1994-2018
Notes: Based on average appropriations and net tuition revenue for all public higher education institutions. Net tuition revenue refers to the published tuition fee minus student financial aid provided by the institution. Amounts adjusted for inflation using the Higher Education Cost Adjustment (HECA).
Source: Adapted from SHEEO (2019[78]), SHEF: State Higher Education Finance, https://sheeo.org/project/state-higher-education-finance/.
Public spending on student financial aid in Ohio is lower than in comparable states and many students are ineligible for state support
Alongside institutional subsidies to public institutions (the SSI) and the policy of capping rises in tuition and fees discussed above, Ohio seeks to make attending higher education more affordable for state residents by providing state student aid to complement the system of Pell Grants administered by the federal government. The main source of state-level financial aid for students is currently the Ohio College Opportunity Grant (OCOG), which, in 2020, had an annual budget allocation of just over USD 122 million. As explained in Box 4.7, OCOG is a “Pell first” grant system, awarded to institutions for Pell-eligible degree-seeking students who meet specific financial need criteria.
OCOG was created in the wake of the Great Recession, when Ohio public finances were under considerable strain. In common with other states across the country at the time, Ohio law makers sought to reduce public spending. In the field of higher education, the funding reductions were focused proportionally more on state grant aid to students than on state operating subsidy to institutions, which, as discussed above, was less severely impacted than in some other states. As illustrated in Figure 4.16, Ohio’s average state spending per FTE student fell by over 60% between the financial years 2009 and 2010. In the same year, state appropriations to institutions per FTE student also fell, but only by around 16%. As a result, as also illustrated in Figure 4.16, state spending on student aid per FTE student declined as a percentage of educational appropriations per FTE from 7% in 2009 to 3% in 2010. The level of state spending per FTE on student aid has subsequently been increased (by around 30% in real terms between 2010 and 2018), but remains comparatively low in comparison to other states. In 2018, the level of annual state student aid spending per FTE student in Ohio was only around 30% of the average of 47 states for which data are available, at USD 218 compared to USD 752 (SHEEO, 2019[111]).
Box 4.7. The Ohio College Opportunity Grant (OCOG)
The Ohio College Opportunity Grant (OCOG) was introduced in 2010, replacing an earlier system of state financial aid, to provide financial support to Ohio residents attending higher education in the state. The key characteristics of the grant programme are:
OCOG is a “Pell first” student grant programme: students must apply for federal financial aid using the Free Application for Federal Student Aid (FAFSA), with OCOG funds being allocated to institutions by the Ohio Department of Higher Education for students in receipt of Pell Grant support who meet specific state-level eligibility criteria.
For the 2019/20 academic year, students with an Expected Family Contribution (EPC) of USD 2 190 or less and a maximum household income of USD 96 000 – based on their FAFSA application – were eligible for OCOG awards.
Funding is available for students studying for associate’s degrees, first bachelor’s degrees or nursing diplomas in accredited public, private not-for-profit and private for-profit institutions, with different standardised maximum award amounts established for different institutional types. Pro-rata award amounts are calculated for part-time students.
OCOG is designed to cover only instructional and general fees charged to students, which are the only costs included in the “state cost of attendance”. The maximum awards for each institutional type take into account only fee levels that exceed USD 6 095, which is the standard combination of maximum Pell Grant and EPC fixed by the federal student aid system.
Source: ODHE (2019[114]).
Figure 4.16. Spending on state public student aid since 2008
Note: Left axis shows student aid per FTE in 2018 dollars, adjusted for inflation using the Higher Education Cost Adjustment (HECA). Right axis shows public aid as a percent of educational appropriations
Source: Adapted from SHEEO (2019[78]), SHEF: State Higher Education Finance, https://sheeo.org/project/state-higher-education-finance/.
OCOG’s comparatively limited overall budget has made it necessary to target the available resources. A key choice has been to focus OCOG funds exclusively on helping students to cover tuition and fees. Whereas the definition of “cost of attendance” used by the federal student aid system includes housing and living costs as well as the costs of books, equipment and transport (FSA, 2019[115]), the “state cost of attendance” used by Ohio authorities to calculate OCOG award levels includes only instructional and general fees charged to the students (ODHE, 2019[114]). Using this concept of cost of attendance, OCOG is targeted at covering tuition and fees for eligible students where these costs are not already covered by a combination of Pell Grants and the federally determined Expected Family Contribution (EFC). As the current maximum annual combination of Pell Grant and EPC is USD 6 095, and annual tuition and general fees in community colleges and university regional campuses are lower than this, students at community colleges and university regional campuses are not eligible for OCOG. Similarly, Pell-eligible students at public universities with lower tuition and fees – including the Historically Black institution Central State University – are eligible for lower OCOG awards.
The current system is transparent and equitable. It assumes the first duty of the state is to help students from low- and middle-income backgrounds cover the unavoidable costs of tuition and fees, putting more expensive study options more easily within reach of these groups. Based on “sticker price” rates (ODHE, 2019[113]), even with a full Pell Grant (USD 6 095) and maximum OCOG award of USD 2 000, a student at a public doctoral university in Ohio in 2019 will have to “cover” at least an additional USD 2 000 a year from other sources for tuition and education fees. Although, in practice, many such students will benefit from institutional funding awards and tuition waivers to cover fees, they will still need to cover housing, equipment and living costs that come on top. With a maximum Pell Grant, full-time students on degree programmes at public community colleges (where average “sticker price” tuition in 2020 was USD 4 828 and no OCOG is available), would receive around USD 1 250 per year towards other costs. In university regional campuses, where costs are higher (ODHE, 2019[113]), Pell funding would be fully absorbed by full tuition and fees.
While other more targeted state-level student funding streams exist (see below), it is clear that mainstream federal and state student aid programmes provide limited or no financial support to help low-income students in Ohio with costs beyond core tuition and fees. It is also striking that the state’s main financial aid programme offers no support to students in the open access institutions (community colleges and university regional campuses) that concentrate the largest numbers of low-income and Black/African American students in the state. State financial support systems in comparable states tend to offer at least some support in such cases. A 2016 nation-wide analysis by University of Pennsylvania’s Institute for Research on Higher Education ranked Ohio 45th of the 50 states in terms college affordability, based on the percentage of income required to pay for the net price of college, including living costs (Institute for Research on Higher Education, 2016[116]). Given the influence of cost on college entry and completion and Ohio’s ambitious attainment target, leveraging additional investment for student support is likely to be an important priority for Ohio law makers. The state operating budget for the 2020/21 biennium includes a 20% increase in OCOG funding for 2021 (Ohio General Assembly, 2019[112]). It is likely further increases will be needed to support achievement of Ohio’s 65% attainment goal.
Ohio uses a strongly output-focused system to allocate state funding to public higher education institutions
If the overall level of funding directed to higher education institutions and students affects the ability of higher education systems to meet societal skills demands, so (in theory) do the ways in which this funding is allocated and targeted. Ohio has used both its main institutional funding mechanism and targeted student funding programmes to support state goals related to skills supply and workforce development.
The State Share of Instruction (SSI) that provides core state funding for instructional activity to public colleges and universities is allocated entirely based on the outputs achieved by institutions. As explained in Box 4.8, distinct output-based formulae are used to allocate the available SSI funding for each sector to universities and community colleges, while a separate budget line and allocation formula exists for Ohio Technical Centers (OTCs). The key metrics used – course completion, success points (in community colleges) and degrees awarded – all promote credit and credential completion. Additional weighting is given for “at-risk” students from low-income and disadvantaged backgrounds, which means institutions receive additional money when such students attain success points and complete courses and programmes. This provides incentives for institutions to support progression and completion for students in these groups.
Box 4.8. Allocation of the State Share of Instruction (SSI) in Ohio
The Ohio General Assembly establishes the budget envelope available for educational appropriations to universities, colleges and Ohio Technical Centers (OTCs) in Ohio in the biennial state operating budget. The budget for the biennium 2020/21 allocates around USD 2 billion annually for universities and colleges (the State Share of Instruction – SSI) and USD 20 million annually for OTCs (Ohio General Assembly, 2019[112]).
These funds are allocated to individual institutions using three distinct output-based formulae:
4. For universities and their regional campuses: around 30% of total SSI funds earmarked for universities are allocated for course completions by FTE students; 50% for degree completions by FTE students; and the remaining 20% to eligible institutions for medical and doctoral training (referred to as “set-asides”).
5. For community and technical colleges: 50% of SSI funds earmarked for colleges are allocated for course completions; 25% allocated on the basis of “success points” (credits and development programmes completed); and 25% on the basis of specific completion metrics (associate’s degrees, long-term certificates and transfers to four-year institutions).
6. For OTCs: 25% is allocated for programme completion; 20% for retention (students completing 50% of programme); 5% for industry-recognised third-party credentials; and 50% for each FTE student who moves to employment, military service or further post-secondary study.
In the allocation process, the first step for universities and colleges is to determine cost of courses and degrees. All courses are assigned to 1 of 26 cost categories depending on subject area and level of instruction, with cost per FTE student updated each year based on reported cost and enrolment data for previous years. STEM subjects are protected from potential reductions in FTE costs.
The second step is to calculate the numbers of FTE students completing courses and degrees and obtaining success points, using a rolling three-year average of the relevant data for each institution. “At-risk” students are given additional weighting in the formulae (so institutions receive additional funding for each of these students who completes courses or programmes). In universities, students from low-income backgrounds, with low ACT scores at entry, or doing developmental coursework are counted as “at-risk”. For colleges, extra weighting is given for “access students”, which, in addition to the criteria similar to those used in universities, includes students over 25 and from under-represented ethnic groups.
The SSI allocation received by each institution is essentially a function of: a) the total funds available for the sector; b) the number of relevant outputs they achieve in different course cost categories; and c) the demographic profile of their successful students (proportion of “at-risk” or “access” students).
Sources: ODHE (2019[117]), ODHE (2019[118]), Ohio General Assembly (2019, p. 2448[112]).
Since the new system was introduced in 2012, completion rates have been rising (ODHE, 2020[119]), and institutions and stakeholders consulted by the OECD team generally view the system to have been successful. In particular, institutional representatives praised the decision of the then Ohio Board of Regents to delegate the detailed development and design of the new funding allocation system to a working group composed of representatives of public higher education institutions. This helped to ensure the new system took into account the specificities of the different sectors, contained safeguards to prevent very radical changes in funding from one year to the next, and was widely accepted by faculty and staff within institutions.
Independent research has examined the impact of performance-based institutional funding systems in the United States, including the SSI in Ohio (Hillman, Tandberg and Fryar, 2015[120]; Dougherty and Reddy, 2013[121]; Li, 2018[122]; Hillman, Hicklin Fryar and Crespín-Trujillo, 2018[123]). These different analyses provide mixed findings on the real effectiveness of performance-based funding systems in general, and in Ohio in particular. The available evidence does not point to a strong relationship between the introduction of output-based systems and improved progression and completion rates. Several of the authors point to the wide range of factors that influence students’ progress through higher education, including disadvantaged backgrounds, financial pressures and other challenges in their life beyond college, as well as the limits of the actions higher education institutions can take to help students overcome these external challenges. At the same time, the research suggests that the introduction of output-based funding, including the SSI, has influenced institutional and faculty behaviour, increasing focus on helping students to progress and complete their studies.
Although the evidence on the effectiveness of output-based funding is inconclusive, there have been calls within Ohio to include a stronger focus on graduate employability in the metrics used to calculate the SSI. It is true that the current SSI model provides strong incentives for institutions to support completion in general, but does not specifically reward efforts to address specific workforce skills shortages or ensure a strong focus within programmes on preparing graduates for the labour market. The current state budget calls on the ODHE to undertake a study into how post-graduation employment measures could be used in the distribution of state funding (Ohio General Assembly, 2019, p. 2463[112]). Possible metrics suggested in the legislation include the relevance of graduates' degrees to job placement, employment in Ohio versus employment out-of-state, placement in high-demand fields, and other qualitative factors. Although some other states do use employment metrics in their funding allocation formulae, the evidence to support such a move outside very specific career-oriented programmes is weak. In particular, it is questionable whether the influence institutions have on graduate employment is sufficient for them to be held directly accountable for employment outcomes in a funding formula. Ohio authorities and law makers will need to take this into account in future decision-making on this matter.
Other targeted funding programmes seek to promote workforce-relevant objectives, although the sums involved are comparatively small
Ohio authorities have used several targeted funding programmes to promote the workforce relevance of higher education provision in Ohio, complementing the core institutional funding and student support mechanisms discussed above.
The Regionally Aligned Priorities in Developing Skills (RAPIDS) Program, for example, focuses on capital investment. It provides targeted funding to regional consortia of public higher education institutions for equipment to educate students in in-demand occupations. The programme has a budget allocation of USD 16 million for the 2020/21 biennium (Ohio General Assembly, 2019[112]). The ODHE administers the programme through open requests for proposals. It requires those submitting bids to demonstrate how investments in specific items of equipment will allow students to acquire career-relevant skills that meet demonstrated need in specific industries, with a focus on the growth sectors of advanced manufacturing, robotics and cybersecurity. All funding requests must include letters of support for the project and equipment investment from at least seven businesses in the target industry (ODHE, 2019[124]). Once in place, the equipment purchased with RAPIDS funding is accessible to all the institutions in the regional partnership.
In common with other states, Ohio has also used targeted funding for student financial aid to incentivise students to pursue study options that correspond to identified areas of skills demand in the state. The “Choose Ohio First” scholarship programme, initiated in 2008, provides scholarships to students studying Science, Technology, Engineering, Mathematics and Medical subjects (STEMM). The programme is open to public and private institutions. To secure funding, institutions must submit proposals to the Ohio Department of Higher Education. Programmes that are successful are required to use the funds awarded to provide financial assistance to students of between USD 1 500 (required minimum) to USD 7 995 (maximum) annually, based on current tuition levels. Students from under-represented groups are prioritised, although detailed award criteria are established by each institution. Evidence from elsewhere in the United States suggests that targeted funding programmes, such as Choose Ohio First, can be an effective means to increase uptake and completion of STEM programmes (Castleman, Long and Mabel, 2017[125]).
Historically, Choose Ohio First only provided funding for degree programmes, but the 2020/21 state budget extended the scope of the initiative to include funding for students on certificate programmes in STEMM fields. The biennial budget also allocates increased resources to the programme, with total annual funding planned to increase from around USD 28 million in 2020 to USD 40 million in 2021 (Ohio General Assembly, 2019[112]). In late 2019, the ODHE launched a special request for proposals for eligible degree and certificate programmes in the field of computer science (ODHE, 2019[126]).
The most recent targeted funding initiative to support post-secondary skills development aligned to workforce needs is the TechCred programme (Box 4.9). This initiative, launched in summer 2019, is innovative in Ohio in that it provides funding to employers to support the upskilling of existing or prospective employees in high-demand technology fields (ODHE, 2019[127]).
Box 4.9. Ohio’s TechCred program for existing and prospective employees
With an annual budget of USD 15 million for the 2020/21 biennium, the TechCred programme will award funding to businesses that invest in training their existing staff or new recruits in approved technology-focused programmes that lead to an industry-recognised credential. Businesses that submit successful applications will be reimbursed up to USD 2 000 for each current or prospective employee who successfully completes a credential. Employers are eligible to receive up to USD 30 000 per funding round.
The TechCred eligible credential list includes only short-term, industry-recognised certificates and certifications in approved technology-focused fields. Credentials are added to the list through employer applications which are reviewed by a panel of stakeholders. Employers must identify specific technology-related skills needs in their workforce and partner with a credential provider before applying online. If their proposal is approved, the proposed training can proceed and, on production of the valid credential certificates, the Ohio Development Services Agency (DSA) reimburses the employer for training costs up to the fixed ceiling per employee and per funding round. At the time of writing, the first funding round was ongoing.
Sources: ODHE (2019[127]), Ohio General Assembly (2019[128]).
Ohio’s main targeted funding programmes to promote workforce skills development at the post-secondary level each has a well-defined and complementary focus. The programmes have been carefully designed to create incentives for higher education institutions and employers to focus on workforce skill issues and co-operate across traditional institutional boundaries. The Choose Ohio First scholarship initiative and, more recently, the RAPIDS programme have secured a high-level of engagement from higher education institutions and employers over a number of years. The ODHE collects performance and financial data from grantees on a regular basis, which allow the Department to assess the effectiveness and efficiency of the programme. However, to the knowledge of the OECD team, none of these targeted programmes has been subject to an external evaluation of the results and potential impacts received. Evaluations would be valuable as an input for Ohio law makers making decisions about the future development of these programmes and the potential scale of state investment, as well as for policy makers involved in the day-to-day implementation of the programmes.
Recommendations on funding
1. In recognition of the importance of financial barriers to participation in higher education among low- and middle-income groups, Ohio law makers should continue to prioritise increases to the budget envelope allocated to the OCOG student aid programme, which is currently funded at a lower level than its equivalents in other states.
2. To help increase the supply of graduates in support of the state’s 65% post-secondary attainment goal, future iterations of OCOG should seek to increase the availability of public student aid to students from disadvantaged backgrounds who are most in need of financial support for living expenses, transport, books and equipment. One way to do this would be to make OCOG awards available to students at university regional campuses and community colleges, which concentrate a large proportion of low-income students in the state, but are currently excluded from OCOG. Ohio authorities should also adopt the federal definition of “cost of attendance”, which includes the full range of costs associated with study, as a reference for assessing financial need and policy making.
3. Ohio authorities should analyse the impact that output-based formulae used to allocate the State Share of Instruction (SSI) have had to date on student progress, completion and credential acquisition to develop a clear picture of the effects of the policy. In considering the inclusion of labour market outcome indicators in the formula (as requested by the Ohio General Assembly), policy makers should take into account evidence on the effectiveness of using such measures from states that have already used them in performance funding models. Florida and Louisiana are the only states known to have has used labour market outcome measures for funding allocations to four-year institutions. A wider set of states, including New York, North Carolina, Tennessee and Virginia have used such measures in funding two-year institutions (Li, 2018[122]). Internationally, Denmark has experimented with using employment outcome measures in institutional funding allocations (see Chapter 3).
4. The ODHE should consider using the additional resources made available for the Choose Ohio First programme to expand the availability of scholarship funding for high-quality, industry-recognised certificate programmes in high-demand fields (building on the experience of the current request for proposals for STEMM-related programmes).
5. The full payment of the scholarship funding under Choose Ohio First could be made conditional on successful acquisition of a degree or industry-recognised credential, potentially drawing inspiration from Virginia’s FastForward programme (see Chapter 6).
6. To improve the evidence base for decision makers, the ODHE should consider commissioning independent evaluations of its targeted funding programmes to support the workforce alignment of higher education, including RAPIDS, Choose Ohio First and (once implementation is well underway) the newly launched TechCred programme. The results of such evaluations would inform decisions about the continuation and appropriate funding of these programmes (including whether scaling up would be appropriate), as well as possible changes to their detailed design and implementation.
Information
For those working to achieve a good alignment between higher education and the needs of the labour market – whether student advisers, educators, employers or policy makers – good quality information on skills demand and the outcomes of current graduates is important. It is inherently challenging to measure labour market skills demand, as individual “skills” can be understood in different ways and it is not always easy to define the exact skill sets needed for each distinct occupation. Similarly, care is needed in interpreting graduate labour market outcomes, as a wide range of factors, from personal choice to macro-economic conditions, can affect the employment rate, occupation and earnings of graduates. In common with other states across the United States, Ohio has exploited state-level administrative data to develop information tools in the areas of skills demand, skills supply and graduate outcomes.
Ohio has a co-ordinated approach to collecting, collating and making public data on labour market skills demand and the outcomes of higher education graduates
The Ohio Education Research Center (OERC), a unit within Ohio State University’s college of public affairs, co-ordinates the analysis and publication of educational outcome and workforce data in Ohio on behalf of relevant state agencies. The OERC is member of Ohio Analytics, an administrative data partnership that centralises state administrative data into a single data repository, the Ohio Longitudinal Data Archive (OLDA), for education and workforce research. As summarised in Box 4.10, the OERC has exploited this data source to develop several data “dashboards” relating to skills supply and demand and graduate outcomes (OERC, 2020[92]).
JobsOhio regional forecasts and employer survey data on job openings, as well as data on median earnings by occupation, are used to generate an annual “in-demand jobs list” for Ohio. This list currently contains 229 occupations, with in-demand occupations categorised by the education level typically required for entry (OhioMeansJobs, 2019[47]).
Box 4.10. Data resources produced by the Ohio Education Research Center (OERC)
The OERC co-ordinates Ohio’s state-wide data resources on labour market demand and the outcomes of post-secondary education graduates. It has produced public data “dashboards” using this data, as well as a tool to monitor the outcomes achieved by individuals who have participated in-state workforce programmes:
OhioMeansJobs Workforce Data Tools: First, a workforce supply tool that provides information about graduates from educational programmes that support in-demand occupations in Ohio, to inform users about the pipeline of supply of workers to industry. Second, an employment projections tool that provides information about the growth in job openings over time by occupation, as well as the number of job openings and median wages. Both tools are hosted on the OhioMeansJobs website, the web presence of Ohio’s public employment service.
Ohio Higher Education Outcomes: Longitudinal data showing employment outcomes of graduates who stay in Ohio after earning a degree. The first visualisations show the industry in which a graduate works for each major (field of study), as well as earnings for up to six years after graduation. Additional earnings outcomes visualisations are in development.
Workforce Success Measures: With the Governor’s Office of Workforce Transformation (OWT), OERC has used historical Ohio administrative data to provide employment and related outcomes of individuals who have completed (federally funded) workforce development programmes in the state. These data are designed to enable workforce programme administrators and policy makers to understand and improve the effectiveness of Ohio’s workforce development programmes.
Source: OERC (2020[92]).
Existing data resources are not always well targeted to the needs of specific user groups, and there is limited evidence on how data are used
The data resources developed by OERC provide valuable information and potential user groups and uses for each dashboard are clearly identified on the relevant web pages. Dashboards are designed to make complex data sets more accessible by presenting them in a simple, interactive way. There is a risk, however, that in attempting to serve multiple user groups that the dashboards serve no one particularly well. Policy makers, analysts and higher education institutions may simply want access to the underlying data sets to perform their own analyses, but these data sets are not easily downloadable. At the same time, the dashboards may not be sufficiently accessible and intuitive for prospective students, current students and jobseekers. In their current form, the dashboards seem most likely to be of use for those involved in student advising, who can use the tools in their work.
Together, the OERC, the Ohio Department of Jobs and Family Services, and the Governor’s Office of Workforce Transformation make large amounts of labour market information available through various means, including programme-level workforce success measures, as well as employment rates earnings at the individual programme level. However, the existing state information sources suffer from a number of limitations. Firstly, graduate outcomes data relate only to those who remain working in Ohio after graduation, and therefore provide only a partial picture of employment and earnings outcomes. For example, even though employment rates for bachelor’s graduates living in Ohio surpassed 90%, between 2010 and 2015, only about 65% of bachelor’s graduates from Ohio institutions were found working in the state in the fourth quarter after graduation, illustrating that information on labour market outcomes for a large share of graduates is not available.
Secondly, in the absence of any defined performance targets or benchmarks related to the information on labour market outcomes, the available data do not provide any guidance on how to interpret and assign a value judgement to it. For example, while comprehensive data on completions, employment and earnings are provided in the Governor’s Office of Workforce Transformation’s “workforce success measures” dashboard, without associated targets, and a counterfactual or reference group, it is not possible to ascertain whether the existing workforce programmes are judged to be meeting their objectives and effectively contributing to the state attainment goal.
The absence of benchmarking also limits the interpretability of published labour market outcomes data by users. In particular, earnings data are difficult for prospective students to interpret without corresponding information on completion rates and student indebtedness at graduation. It is particularly important to make this information readily available to those considering studying in programmes and institutions that have demonstrably poor labour market outcomes, to ensure students can make informed choices (see Section 4.2). Data at the federal level from the period of implementation of the Gainful Employment regulations and the Department of Education College Scorecard can potentially provide information that is more comprehensive and meaningful to prospective students. The newly implemented “report-card” system for public schools in Ohio also offers an example of how information can be synthesised in an accessible manner for the benefit of diverse users.
It is also important to ensure that students from lower socio-economic backgrounds and minority groups have suitable channels of access to information, both on labour market outcomes and the educational supports available to them. Evidence indicates that these cohorts are often disadvantaged in terms of their ability to locate and interpret information and advice on going to college, and attach weight to choice factors differently (e.g. (Perna, 2006[129]), (Thomsen et al., 2013[130]) (Hofer, forthcoming[131])).
Recommendations on information
1. Introduce a regular publication schedule for labour market outcomes data and promote it to user groups, including data aimed at students deciding upon their post-secondary education options.
2. Consider relating labour market outcomes data to a set of benchmark metrics in order to give some additional guidance to users. For example, earnings data could be related to the Ohio minimum wage or general sectoral wages for workers without post-secondary credentials, in order to give some indication of the value of obtaining additional credentials in the field. Earnings data could also be shown in conjunction with data on student debt and completion, to help prospective students better contextualise the figures.
3. Consider implementing dedicated information channels tailored for potential students without a family background in post-secondary education, those with lower financial literacy or those who may be unable to easily access information online.
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Notes
← 1. This category includes college graduates who have received a post-secondary level certificate, as well as those who did not complete a college programme. See (National Student Clearinghouse, 2019[132]) and Section 4.2 for more details.
← 2. The 2008 and 2018 figures are not directly comparable, as Ohio began to include workforce-relevant certificates in the progress statistics only in 2014.
← 3. Limited to workers with bachelor’s degrees or above in specific occupations, who are sponsored by an employer, and annual places are capped at 85 000 nation-wide.
← 4. Using a 2% discount rate. See Appendix A of (Carnevale, Cheah and Van der Werf, 2019[80]) for more details.
← 5. The calculations do not benchmark against the returns on not attending post-secondary education. For reference, (Carnevale, Cheah and Van der Werf, 2019[80]) estimates the 40-year NPV of the federal minimum hourly wage of USD 7.25 as USD 347 000 and a worker earning USD 10 per hour, as USD 547 000.
← 6. In order to be eligible for federal funding under the United States Higher Education Act Title IV student assistance programmes, an educational programme must lead to a degree at a not-for-profit or public institution, or it must prepare students for "gainful employment in a recognized occupation.” Gainful employment regulations introduced in 2014 removed access to federal financial aid for programmes where graduates’ debt repayments made up more than 8% of their annual income, or 20% of their discretionary income, on average. The Gainful Employment regulations were repealed by the US government in 2019.