Skip to main content

Advertisement

SpringerLink
Log in

Community Colleges and Labor Market Conditions: How Does Enrollment Demand Change Relative to Local Unemployment Rates?

  • Published:
Research in Higher Education Aims and scope Submit manuscript

Abstract

This study uses fixed-effects panel data techniques to estimate the elasticity of community college enrollment demand relative to local unemployment rates. The findings suggest that community college enrollment demand is counter-cyclical to changes in the labor market, as enrollments rise during periods of weak economic conditions. Using national data for the years 1990 through 2009, we find that a one percentage-point change in unemployment is associated with 1.1–3.3 % increases in enrollment demand. We disaggregate the analysis by total full-time and part-time enrollment, concluding that high levels of unemployment are also associated with greater demand for full-time attendance. Additionally, enrollments are slightly more responsive to unemployment in metropolitan (rather than micropolitan) areas. Informed by enrollment demand theory, our analysis provides an update to the “unemployment elasticity” literature and could aid in current enrollment planning, economic development, and public policy efforts to educate students on the margin between college and work.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Fig. 1

Similar content being viewed by others

Notes

  1. .This period of time incorporates four recessions. For a full list of U.S. recession periods, see National Bureau of Economic Research (2012).

  2. These years represent the earliest and latest available data periods.

  3. We conducted a Hausman specification test, rejecting the null hypothesis that the random effects are orthogonal to the regressors. As a result, the fixed-effects method is preferred.

References

  • Allison, P. D. (2009). Fixed effects regression models. Sage series on quantitative applications in the Social Sciences.

  • Becker, W. (1990). The demand for higher education. In S. Hoenack & E. Collins (Eds.), The economics of American universities: management, operations, and fiscal environment (pp. 155–188). New York: SUNY.

    Google Scholar 

  • Becker, G. S. (1993). Human capital: a theoretical and empirical analysis, with special reference to education. Chicago: University of Chicago Press.

    Book  Google Scholar 

  • Betts, J. R., & McFarland, L. L. (1995). Safe port in a storm: the impact of labor market conditions on community college enrollments. The Journal of Human Resources, 30(4), 741–765.

    Article  Google Scholar 

  • Black, S. E., & Sufi, A. (2002). Who goes to college? differential enrollment by race and family background. Cambridge: National Bureau of Economic Research.

    Google Scholar 

  • Bozick, R. (2009). Job opportunities, economic resources, and the postsecondary destinations of American youth. Demography, 46(3), 493–512.

    Article  Google Scholar 

  • Clotfelter, C. T. (1992). Explaining the demand. In C. Clotfelter, R. Ehrenberg, M. Getz, & J. Siegfried (Eds.), Economic challenges in higher education (pp. 59–88). Chicago: University of Chicago Press.

    Google Scholar 

  • Cohen, A., & Brawer, F. (2008). The American community college (5th ed.). Hoboken: Wiley.

    Google Scholar 

  • Corazzini, A. J., Dugan, D. J., & Grabowski, H. G. (1972). Determinants and distributional aspects of enrollment in US higher education. Journal of Human Resources, 7, 39–59.

    Article  Google Scholar 

  • Dadashova, A., Hossler, D., & Shapiro, D. (2011). National postsecondary enrollment trends: before, during, and after the great recession. Herndon: National Student Clearinghouse.

    Google Scholar 

  • Dellas, H., & Sakellaris, P. (2003). On the cyclicality of schooling: theory and evidence. Oxford Economic Papers, 55(1), 148.

    Article  Google Scholar 

  • Drukker, D. (2003). Testing for serial correlation in linear panel-data models. The Stata Journal, 3(2), 168–177.

    Google Scholar 

  • Elsby, M., Hobijn, B., & Sahin, A. (2010). The labor market in the great recession. Brookings papers on economic activity. Washington, D.C.: Spring.

    Book  Google Scholar 

  • Feldman, P., & Hoenack, S. (1969). Private demand for higher education in the United States. The economics and financing of Higher Education in the United States, 375–95.

  • Fitzpatrick, M., & Turner, S. (2007). Blurring the boundary: changes in the transition from college participation to adulthood (pp. 107–137). The Price of Independence: The Economics of Early Adulthood.

    Google Scholar 

  • Goldin, C. D., & Katz, L. F. (2008). The race between education and technology. Cambridge: Belknap.

    Google Scholar 

  • Heller, D. E. (1997). Student price response in higher education. The Journal of Higher Education, 68(6), 624–659.

    Article  Google Scholar 

  • Hemelt, S. W., & Marcotte, D. E. (2011). The impact of tuition increases on enrollment at public colleges and universities. Educational Evaluation and Policy Analysis, 33, 435–457.

    Article  Google Scholar 

  • Hoenack, S. A., & Weiler, W. C. (1979). The demand for higher education and institutional enrollment forecasting. Economic Inquiry, 17(1), 89–113.

    Article  Google Scholar 

  • Jackson, G. A., & Weathersby, G. B. (1975). Individual demand for higher education: a review and analysis of recent empirical studies. The Journal of Higher Education, 46, 623–652.

    Article  Google Scholar 

  • Kane, T. J. (1994). College entry by blacks since 1970: the role of college costs, family background, and the returns to education. Journal of Political Economy, 102, 878–911.

    Article  Google Scholar 

  • Kane, T. J. (1999). The price of admission: rethinking how Americans pay for college. Washington, D.C.: Brookings Institution.

    Google Scholar 

  • Kane, T. J., & Rouse, C. (1999). The community college: educating students at the margin between college and work. The Journal of Economic Perspectives, 13(1), 63–84.

    Article  Google Scholar 

  • Katz, L. (2010). Long-term unemployment in the great recession. Testimony for the joint economic committee of the US Congress hearing on “Long-Term Unemployment: Causes, Consequences and Solutions”(April 29, 2010).

  • Kienzl, G., Alfonso, M., & Melguizo, T. (2007). The effect of local labor market conditions in the 1990s on the likelihood of community college students’ persistence and attainment. Research in Higher Education, 48(7), 751–774. doi:10.1007/s11162-007-9050-y.

    Article  Google Scholar 

  • Leigh, D. E., & Gill, A. M. (2007). Do community colleges respond to local needs?: evidence from California. Kalamazoo: W.E. Upjohn Institute.

    Google Scholar 

  • Leslie, L. L., & Brinkman, P. T. (1987). Student price response in higher education: the student demand studies. The Journal of Higher Education, 58, 181–204.

    Article  Google Scholar 

  • Levin, J. (2007). Nontraditional students and community colleges: the conflict of justice and neoliberalism. Basingstoke: Palgrave Macmillan.

    Book  Google Scholar 

  • Levine, L. (2011). Economic growth and the unemployment rate. Congressional Research Service, 7–75700, Washington, D.C.

  • Lewin, T. (2012). Obama budget seeks job training at community colleges. The New York Times. http://www.nytimes.com/2012/02/14/education/obama-to-propose-community-college-aid.html. Accessed 18 Feb 2012.

  • Manski, C. F., & Wise, D. A. (1983). College choice in America. Cambridge: Harvard University Press.

    Google Scholar 

  • Mullin, C., & Phillippe, K. (2009). Community college enrollment surge. AACC policy brief series. Washington, D.C.: American Association of Community Colleges.

    Google Scholar 

  • National Bureau of Economic Research (2012). U.S. Business cycle expansion and contractions. NBER. http://www.nber.org/cycles.html. Accessed 24 Jan 2012.

  • Nutting, A. W. (2008). Costs of attendance and the educational programs of first-time community college students. Economics of Education Review, 27(4), 450–459.

    Article  Google Scholar 

  • Pindyck, R., & Rubinfeld, D. (1997). Econometric models and economic forecasts (4th ed.). Columbus: McGraw-Hill/Irwin.

    Google Scholar 

  • Rivkin, S. G. (1995). Black/white differences in schooling and employment. The Journal of Human Resources, 30, 826–852.

    Article  Google Scholar 

  • Rouse, C. E. (1994). What to do after high school: The two-year versus four-year college enrollment decision (pp. 59–88). Choices and consequences: Contemporary policy issues in education.

    Google Scholar 

  • Rusk, J. J., Leslie, L. L., & Brinkman, P. T. (1982). The increasing impact of economic conditions upon higher education enrollments. Economics of Education Review, 2(1), 25–48.

    Article  Google Scholar 

  • Schultz, M. (2010). Federal funding cuts will limit no worker left behind. The Detroit News. http://www.detroitnews.com/article/20100630/BIZ/6300356. Accessed 3 Feb 2012.

  • Stratton, L. S., O’Toole, D. M., & Wetzel, J. N. (2004). Factors affecting initial enrollment intensity: part-time versus full-time enrollment. Economics of Education Review, 23(2), 167–175. doi:10.1016/j.econedurev.2003.06.002.

    Article  Google Scholar 

  • Summers, L. H. (2010). Principles for economic recovery and renewal. Business Economics, 45(1), 3–7.

    Article  Google Scholar 

  • U.S. Bureau of Labor Statistics (2012). Employment situation summary. http://www.bls.gov/news.release/empsit.nr0.htm. Accessed 27 Feb 2012.

  • U.S. Census Bureau (2012). Metropolitan and micropolitan, metropolitan and micropolitan statistical areas. http://www.census.gov/population/metro/. Accessed 9 Feb 2012.

  • U.S. Department of Education (2011). Digest of education statistics, 2010. Digest of education statistics. http://nces.ed.gov/programs/digest/d10/tables/dt10_34.asp. Accessed 3 Nov 2011.

  • Wooldridge, J. M. (2009). Introductory econometrics: a modern approach. Belmont: Cengage Learning.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Department of Educational Leadership and Policy, University of Utah, Milton Bennion Hall, Room 111, 1705 Campus Center Drive, Salt Lake City, UT, 84112, USA

    Nicholas W. Hillman & Erica Lee Orians

Authors
  1. Nicholas W. Hillman
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Erica Lee Orians
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Nicholas W. Hillman.

Rights and permissions

Reprints and permissions

About this article

Cite this article

Hillman, N.W., Orians, E.L. Community Colleges and Labor Market Conditions: How Does Enrollment Demand Change Relative to Local Unemployment Rates?. Res High Educ 54, 765–780 (2013). https://doi.org/10.1007/s11162-013-9294-7

Download citation

  • Received:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s11162-013-9294-7

Keywords

Search

Navigation