Tag: Education

U.S. Occupations with Moderate Unemployment Rates

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There are 3.2 million unemployed workers in occupations with unemployment rates between 5.0% and 6.3% (the U.S. NSA rate for June). A year ago, there were 3.9 million unemployed workers in these occupation categories.

Overall there are 22 two-digit SOC (Standard Occupational Classification System) codes for occupations. The above-mentioned occupations are in 5 categories. Over the past year the number of unemployed workers dropped in 4 of the 5 occupations. At the moment labor shortages are less prevalent in these occupation categories than the SOC codes where the unemployment rate is less than the natural rate of unemployment.

Some of the jobs in these segments (SOC 19 Life Sciences and SOC 25 Education) require higher education degrees. A portion of the Life Sciences and Production occupations are found at primary employers. The Office Support and Sales occupations are common to all industries and typically require on the job training.

The continued decline in the unemployment rate for these occupations is a sign that the economy is faring well.

unemployment rate

It is Time to Bury the Colorado Paradox

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Many years ago, the Colorado paradox was contrived as a way to draw attention to Colorado’s low high school graduation rates.

The paradox is explained as follows: Colorado has one of the most highly educated work forces in the country, yet Colorado is at the lower end of the rankings for high school graduation rates.

The two facts have been tied together for the purpose of shaming policy makers for not providing greater, if not unlimited, funding for Colorado education.

The factors that cause Colorado to be a highly educated state are not responsible for the low graduation rates. If anything, there is more likely to be an inverse relationship between these two variables rather than a positive relationship.

It is no accident that Colorado has a highly educated workforce:

  • Many primary jobs have higher statewide multiplier than most jobs. This means the addition of primary jobs (with highly educated people) will result in the addition of many more support jobs (which may not require a high school or college degree).
  • Forty-seven of the 64 counties are rural. They have a lower level of education and an older population. In other words, people older than 50 who have lived in a rural community all their lives are not likely to need a high school or college education degree and they probably won’t get one. This is not a bad thing. Their happiness and success is not determined by their level of education.
  • The Office of Economic Development and International Trade (OEDIT) has actively recruited companies such as Vestas, Sun, Level 3, and Arrow Electronics. There are many jobs at these companies that require bachelor’s degrees. When these companies moved to Colorado, they brought many workers with them, which in turn created jobs for other Coloradans. As these companies became established they have recruited workers from local colleges and universities.
  • Denver has been identified as a city that attracts highly educated younger workers. They want to move to Denver, live in a loft, work at a company in downtown Denver that pays well, play in the mountains, and live in a state where marijuana is legal. The state is appealing to highly educated workers because of the its lifestyle and its mix of companies.
  • The tourism industry (which is part of OEDIT) markets Colorado as a place to live, work, and play. Some of the people who come here to ski, ride bikes, hike, smoke dope, raft, etc. want to come back and live here. If they have the money to visit Colorado, they are likely to be highly educated and able to afford to live here.
  • Many years ago, officials restricted the number of out-of-state students. They have since decided to allow more international and out-of-state students and raise out-of-state rates disproportionately. This has increased the diversity of their student population and has been a significant source of much needed revenue. It has also increased the number of out-of-state college students who decide to stay here and work.
  • Colorado is a small state. The state’s MSAs have colleges, universities, and federal labs that have a high percentage of workers with college degrees. As the population increases, the number of highly educated workers at these facilities will not increase proportionately with the population growth.
  • Even If Colorado had the best education system in the universe, it would be impossible for it to meet the needs of the public and private workforce. During the Go-Go Nineties the state added almost 700,000 net jobs with gains in all sectors, except Natural Resources and Mining. During the Lost Decade, only 8,500 net jobs were added. For that ten year period, there were net job losses in 5 of the 11 sectors. The state has to import talent do deal with the volatility in the workforce caused by fluctuations in the business cycle. For example, an economic case can be made that it is a wiser investment of scarce resources to import 100 machinists than it is to try to build the infrastructure to train them here.

There are many good reasons for importing talent and the state has a lengthy track record of doing that. That is a good thing. At the same time, there are many good reasons for strengthening the education system so the state produces a higher percentage of high school graduates and a greater number of in-state college graduates. That is also a good thing.

It is time to put the fallacious Colorado paradox in the closet with beanie babies, floppy drives, and Nehru jackets.

Businessweek Rankings – Top Areas of Study for CU Leeds School of Business Near Bottom of Rankings

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Colleges and universities are held accountable for efficiently providing educational services by state agencies and private companies, such as Businessweek and U.S. News and World Report. In late March, Bloomberg Businessweek produced their 2013 ratings for 124 undergraduate business programs (additional information can be found at www.businessweek.com). The table below shows the rankings by academic specialty for Notre Dame, the top ranked school, and the three Colorado undergraduate business programs that were rated.

The profile for each business school included its top study areas. These are listed below along with their ranking by specialty.

Notre Dame Mendoza

  • 2             Accounting
  • NA          Consulting
  • 4             Finance
  • 4             Management of Information Systems
  • 65           Marketing

DU Daniels

  • 22           Accounting
  • 39           Finance
  • NA          Hotel Administration
  • 60           International Business
  • 100         Marketing
  • NA          Ethics, Social Responsibility, General Business

CU Leeds

  • NA          Certificate programs (Real Estate, Entrepreneurship, and Sustainability)
  • 119         Accounting
  • 73           Finance
  • NA          Human Resource Management
  • 121         Marketing
  • 114         Operations Management

CSU Business School

  • 97           Accounting
  • 84           Finance
  • 113         Management of Information Systems
  • 86           Marketing
  • 42           Operations Management

As expected, Mendoza’s top areas of study were also highly ranked, signifying that it is an elite school. At the other end of the spectrum, the top areas of study for CU Leeds were ranked in the lower half of all schools, between 73rd and 121st. This is an indication that it is a third or fourth-tier school. DU Daniels and CSU fall somewhere in between.

These rankings show the depth and quality of the elite programs and point out deficiencies of the lower ranked schools. While these rankings point out strengths and weaknesses of American business schools, the ultimate measure is whether it meets the needs of the individual students.

©Copyright 2011 by CBER.

Have Budget Cuts Negatively Impacted the Public School System?

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A complete answer to this question requires more than a couple hundred words and two charts. On a positive note, K-12 jobs are still being added and assessment scores are above the national norm.

Are jobs being added fast enough, i.e. do the number of new teachers match the increase in students? Are teachers being replaced by teacher aides? Are key administrators being replaced by less experienced and knowledgeable staff? Are deserving professionals not receiving appropriate merit increases? Do the number of employees translate into quality education?

Colorado K-12 public education employment has fared better than the U.S. for the past three years. A review of the 12-month rolling average shows that Colorado employment dropped off from mid-2010 to mid-2011, but has added jobs since. On the other hand, U.S. K-12 public education employment has declined since mid-2009. Undoubtedly many Coloradans may feel the situation could be improved, but it appears to be better than the national trend.

Another area to look at is assessment scores, in particular the National Assessment of Educational Progress (NAEP). NAEP scores show that Colorado 4th grade scores are in the top 18 states for Reading, Math, and Science. Colorado’s eighth grade scores are in the top 10 states for these same subject areas.

Do strong NAEP scores correlate to high graduation rates? Do they mean students won’t need remedial classes if they take college classes? Are they an indicator that students are being educated to perform basic skills in the workplace?

Based on these two data sets, it appears that Colorado is making an effort to staff their K-12 programs as best as possible and that performance, based on NAEP, is better than the national norm. Arguably, other statistics may show the need for improvement, but data in these two areas suggest that Colorado leaders are taking positive steps in a challenging economic environment to educate our youth.

For additional information on the Colorado go to https://cber.co/CBEReconomy.html.

©Copyright 2011 by CBER.

LEHD and Quickfacts – Commerce City – A Community with Atypical Demographics

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Are you a data geek looking for a fix? If so, have you tried the LEHD or Census Quickfacts databases?

The two databases contain information from the U.S. Census Bureau and the Bureau of Labor Statistics. They are combined in a way that allows data geeks, public and private leaders, and others to learn more about their local population and workforce and see what makes their local economy work (or not work).

To illustrate this point, let’s take a look at five examples of information that can be gleaned for Commerce City, Colorado. (Those in the Denver MSA think of Commerce City as the home of the refinery located along Highway 270.)

Example 1
In Colorado 24.5% of the workforce has earnings of $1,250 per month or less, 36.1% have earnings of $1,251 to $3,333 per month, and 39.5% have earnings of more than $3,333 per month.

In Commerce City 17.1% of the workforce has earnings of $1,250 per month or less, 34.2% have earnings of $1,251 to $3,333 per month, and 48.7% have earnings of more than $3,333 per month.

This begs the question, “What industries are driving the higher concentration of earnings in the upper wage category for Commerce City?”

Example 2
In Colorado 50.8% of the workforce is male and 49.2% is female.
In Commerce City 73.7% of the workforce is male and 26.3% is female.

So, why are there more men workers than women in Commerce City? What are the types of jobs that cause that difference?

Example 3
In Colorado 50.1% of the population is male and 49.9% is female.
In Commerce City 50.4% of the population is male and 49.6% is female.

OK? The mix of men and women in Commerce City is split about 50-50, but the workforce (example 2) is not. Where do Commerce City employers find the workers to fill their jobs? Where do the Commerce City women go to work?

Example 4
In Colorado the median value of an owner-occupied home is $236,600
In Commerce City, the median value of an owner-occupied home is $206,600

Earlier we learned that Commerce City has a higher percentage of workers in the upper earnings bracket. If that is the case, then why isn’t the value of the homes higher there? Or do the Commerce City workers in the upper bracket live somewhere other than Commerce City?

Example 5
In Colorado 35.9% of the workforce has a Bachelor’s degree or higher.
In Commerce City 19.8% of the workforce has a Bachelor’s degree or higher.

Again, we previously learned that Commerce City has a higher percentage of workers in the upper earnings bracket. If that is the case, then what types of jobs are they performing that pay well and don’t require a college degree? Or do the people with college degrees live elsewhere and work in Commerce City?

In the matter of minutes it is possible to create a profile about any local community in the United States. Once that sketch of a community is prepared, then another series of probing questions can be asked to address policy decisions regarding social, economic, workforce, or education issues.

What’s the story behind your community? Check out LEHD and Quickfacts to learn more.

 

©Copyright 2011 by CBER.

Colorado Economic Forecast Challenges (Education, Industries, Clusters)

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Another year, another economic forecast.

Looking ahead to 2012, the state will again experience improved, but below average employment growth. Cber.co is projecting that U.S. real GDP growth will be 2.1% to 2.5% in 2012, with employment growth of 27,500 to 37,500 in Colorado. For more details about the Cber.co 2012 Economic Forecast, click here.

There are a myriad of challenges facing the Colorado and U.S. economies in 2012. Some of the key questions relating to these challenges are categorized into the following four areas:
• Demand for goods and services;
• Debt, the financial system, and politics;
• Education and workforce; and
• Industry and cluster issues.

This post raises questions about the topics of education and workforce; and industry and cluster issues. The topics of demand for goods and services; and debt, the financial system, and politics were discussed in a post entitled “Colorado Economic Forecast – Challenges (Demand and Debt).”

Education and the Workforce
• When will the higher education bubble burst?
• How will higher education improve their performance in the classroom?
• How will the state fund PK-12 education, particularly given the outcome of the Lobato education adequacy lawsuit?
• Are high school and college students learning skills that can be transferred between professions?
• What is being done to address the mismatch between the skills that companies need and the skills of job applicants?
• What is the role of the older worker in the workforce? How are companies addressing their impending retirement?
• Has Colorado lost its pool of trained workers as a result of the Lost Decade?

Industry Issues
• How has Colorado’s high tech cluster weathered the Lost Decade?
• Has Colorado lost its critical mass of manufacturers?
• Has Colorado lost the supply chain associated with the decline in its manufacturers?
• Is Colorado saturated with retail stores?
• How will second and third generation businesses transition into the future?
• How much longer can the Health Care sector continue to add jobs?

Cluster Issues
• Is homeland security a cluster that is still important to the state?
• What happened to Colorado’s nanotechnology cluster? Five years ago it was top 10 in the country. Today it is seldom mentioned?
• Several studies have pointed to the rise of Colorado’s biosciences cluster? How will this translate into growth at Fitzsimons?
• How is the software industry going to survive and thrive given the mismatch of skills in the labor pool and the needs of the companies?
• Will 2012 be the year that photonics is recognized for its contribution to the state economy?
• Are state and local leaders poised for the volatility of the renewable energy cluster?
• How will budget reductions affect Colorado’s defense and aerospace clusters?

Clearly, it is easier to point out the difficult challenges than it is to answer questions relating to them. As well, additional obstacles will be added to the list throughout the year. While there is a lot that could go wrong, it is important to keep in mind the state has an equally impressive list of assets that can be used to address the challenges of the future. Game on!

 

©Copyright 2011 by CBER.

Sectors Losing Jobs Have Higher Wages

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Through the first 8 months of the year there are 7 sectors of the economy that have lost a net total of 25,100 jobs, compared to the same period last year.

Construction                                     -8,800
Financial Activities                            -4,200
Federal Government                         -3,400
Information                                       -3,400
B-to-B (Not Employment Services)  -2,600
Local Government (Not K-12)         -1,600
K-12 Education                               -1,100

These sectors account for 33.3% of total employment. Average wages for this mix of workers is about $56,600 compared to average annual wages for all employees of about $47,900 (calculations based on 2010 QCEW data). In other words, the average wages for the sectors that are losing jobs is significantly greater than the overall state average, based on 2010 data.

The 2011 prognosis is that each of these sectors will show job losses for the year (2011) and that average annual wages for the group will remain well above the overall state average.

For a comprehensive review of the Colorado economy visit the CBER website.

©Copyright 2011 by CBER.

Cooperation and Sharing… Can You Say CIC?

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A member of the 1967 Ohio State University lacrosse team was recently being harassed by friends about the firing/resignation/departure of Jim Tressel, the Buckeye football coach. After a few minutes he politely told his tormenters, “Can you say CIC?”

Say what?

For the benefit of his distracters, the proud Buckeye explained how the CIC is one of the nation’s top economic engines. For the unenlightened, the Committee on Institutional Cooperation is a consortium of the Big Ten member universities plus the University of Chicago.

For five decades the group has worked together to further the missions of their respective universities. They have done this by sharing their knowledge, unique skills, and expertise for the good of the greater cause.

According to the CIC website, 385,000 students attended the universities in the consortium in 2006-2007 (last available data). During that period members received $6 billion in R&D funding. Overall, the institutions awarded 6,532 doctoral degrees, including 20% of U.S. engineering doctoral degrees, and 25% of U.S. agricultural doctoral degrees. While it would be easy to further summarize CIC successes, a greater appreciation of the their programs and impacts can be gained by visiting their website.

Cooperation and sharing expertise – two simple concepts that we were taught in kindergarten.

Looking closer to home… While it is not reasonable to expect Colorado’s higher education system to match the impacts of the CIC, it is fair to hold the system accountable for their cooperative spirit and their willingness to share expertise.

Over the past decade, Colorado’s colleges and universities have been focused on Ward Churchill, Lisa Simpson, 4/20, a lawsuit over toilet paper, which school had the best advertisements at DIA, and a series of PR other gaffes. Colorado higher education has created the impression that it is driven by $$ more than the greater good of the cause.

The system has posted gains in employment during two recessions. Average annual wages have grown at a faster rate than the private sector. Despite tough economic times, Colorado higher education has ramped up its lobbying and fund raising efforts. It has requested and expected double-digit tuition increases to be granted without question.

Cooperation and sharing…the backbone of the CIC. Do they exist in Colorado higher education?

LASP, Maven, EUV, and JILA are great examples of what can happen when people respectfully work together and exchange ideas. Does this collaboration exist beyond engineering and the sciences? What is being done to increase partnerships and eliminate fiefdom building and working in silos? What is being done to make collaboration and the legitimate exchange of ideas a greater part of all disciplines at each of the state’s community colleges, colleges, and universities?

As Colorado legislators ponder ways to improve higher education, the concepts of cooperation and sharing should be part of the discussion. Colorado deserves a higher education system that delivers the goods with the cooperative spirit of the schools in the CIC.

 

©Copyright 2011 by CBER.

Is Colorado Higher Education Effectively Delivering the Goods?

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Earlier this spring Dan Hawkins was replaced as CU football coach because his teams lost too many games and ticket sales began to wane. There was a perception that investments in the CU football program were not paying dividends. A change was made and public sentiment turned from outrage to support when CU leadership announced a replacement (Yes, athletics are an important part of higher education).

When are the masses that cried for the removal of Hawk going to show a similar sense of concern when investments in academic programs do not pay dividends? It only seems fair that college deans should endure the same scrutiny as Hawk when their faculty cannot conduct research or connect with content in the classroom. Shouldn’t deans be held responsible when they manage programs that are irrelevant or not cost effective?

Colorado has one of the most highly educated workforces in the country. An exceptional higher education system is essential if the state hopes to retain it.

Non-farm wage and salary data shows that there are about 66,000 employees at higher education institutions in metro and rural areas across the state (This number includes some student workers). More importantly, they are a source of training for the world’s current and future workforce. Higher education is an economic driver of the state for both reasons.

During the Lost Decade (2000 – 2010), the state’s higher education sector added 12,300 workers. Meanwhile, the private sector (non-farm wage and salary) declined by 50,100 workers.

In Boulder County, higher education employment increased by 2,700 workers. At the same time, private sector employment shed 10,600 workers.

Current wage data for the period 1999 to 2009 shows that average wages for higher education increased faster than the private sector. In 1999 average annual wages for higher education and the private sector were similar, $34,126 and $34,317 respectively. By 2009, there was a noticeable gap between the two groups, $49,610 for higher education and $46,855 for the private sector.

During this time, many businesses were forced to reduce their staffs, cut expenses, and creatively mange their businesses. In the process, the surviving companies became more efficient and productive. All the while, higher education lobbied hard for increased funding and tuition increases. As well, they embarked on the silent phase of a $1.5 billion fund raising campaign.

The question must be asked, “What dividends did Colorado receive from this increase in the number of higher education workers and their higher than average wage increases?”

Consider the value proposition of the Laboratory of Atmospheric and Space Physics (LASP) at CU-Boulder. LASP’s goal is to train the next generation of space scientists, engineers, and mission operators. LASP is the world’s only research institute to have sent instruments to all eight planets and Pluto.

Recently, they were awarded a $425 million grant to work on the MAVEN (The Mars Atmosphere and Volatile Evolution Mission). MAVEN will be launched in 2013 to learn more about the Mars climate and atmosphere. Both undergraduate and graduate students will be taught the basics in the classroom, integrated into all phases of MAVEN, and provided opportunities for on-the-job training that will be invaluable when they enter the job market.

Historically, LASP has had a strong value proposition for students, faculty, sponsors, and its private sector partners.

Also consider the value proposition of the Leeds School of Business at CU-Boulder.

About a year ago, the Denver Business Journal published the results of national rankings for 111 business schools. The DBJ listed rankings for CU, CSU, and DU.

The Leeds School can point with pride to their ranking in sustainability:
• Sustainability: CU/Leeds, 19th; CSU, 36th; DU/Daniels, 40th

The Leeds ranking in the core areas of a business education make Dan Hawkins look like an All-Star:
• Accounting: DU/Daniels, 27th; CSU, 74th; CU/Leeds, 78th.
• Ethics: DU/Daniels, 3rd; CSU, 85th; CU/Leeds, 91st.
• Financial management: DU/Daniels, 50th; CSU, 84th; CU/Leeds, 89th.
• Strategy: DU/Daniels, 55th; CSU, 82nd; CU/Leeds, 105th.
• Operations management: CSU, 45th; DU/Daniels, 57th; CU/Leeds, 109th.
• Marketing: DU/Daniels, 31st; CSU, 73rd; CU/Leeds, 111th.

If the perception exists that Leeds students are not taught the basics, does it really matter if CU/Leeds has a solid sustainability program?

A more recent ranking of MBA programs shows that Leeds provides a solid MBA experience. However, a look at the average GMAT scores suggests that a Leeds MBA falls in the third or fourth-tier.

Why haven’t previous deans and associate deans who oversaw the MBA program been held responsible for not seeking “flagship status” for a Leeds MBA.

Let’s look at the cost of producing these results for Leeds undergraduates and graduates. The faculty pecking order ranges from senior instructor to full professor (tenured), with annual salaries varying from $100,000ish to $300,000+. The directors of the various centers receive salaries in this same range. Many of the higher paid professors have minimal “real-world” experience and often teach fewer students than the lower paid instructors. The leader of the group is the dean, with at salary of $400,000+ per year.

LASP can send a satellite to Mars and incorporate students in the process and the Leeds School can claim that their marketing program is ranked 111th out of 111. It doesn’t take a rocket scientist to see that there is a difference in programs and the accountability of their leaders.

Will the Leeds dean be held accountable for improving the performance of the business school in exchange for the $1+ million he will receive for his brief layover in Boulder? (The life expectancy of a Leeds dean is about 2.5 years). What steps is he going to take to ensure that a Leeds education includes a strong foundation in the basics (marketing, accounting, strategy, operations, and ethics). What is going to be done to make the Leeds School as meaningful and relevant as LASP?

While these two examples focus on CU-Boulder, this isn’t just about them. Every institution of higher education has a number of programs and value propositions. Some are like LASP, some are like Leeds, and others are in between.

Every dean and faculty member at these institutions must be held accountable for efficiently and effectively training our country’s current future workforce.

During the Lost Decade, higher education employment increased and workers received greater wage increases than the private sector. It is now up to higher education to demonstrate and justify the dividends that have been generated because of that investment. If that dividend cannot be confirmed, then higher education has an obligation to reduce employment, eliminate programs, and seek the efficiencies that were gained by the private sector in the last two recessions.

Just as Hawk was held accountable for his team’s performance, stakeholders (state policy makers, parents, business leaders, alumni, and students) must hold higher education leaders accountable for the performance of their system. Colorado deserves a higher education system that pays greater dividends.


Large advertisement at Denver International Airport for CSU’s business school.

©Copyright 2011 by CBER.