Community Colleges, Budget Cuts, and Jobs

Abstract

In the decades following World War II, a significant expansion of community colleges occurred throughout the United States. As the baby boom generation came of age, demand for higher education spiked, and policy makers allocated the requisite funding to expand institutions of higher education. This expansion, including vigorous funding from federal, state, and local units of government, was politically popular. This openhanded support ended in the latter decades of the twentieth century as hostility to paying taxes and to public spending mounted. In recent decades, community colleges have competed with other social expenditures, such as prisons and health care demands, for scarce public resources. And, in a number of states, community colleges have fared poorly in this competition. Using multivariate analyses and data gathered from several sources, including the American Association of Community Colleges, the authors examine the impacts of community colleges on local employment trends. Their research focuses on rural counties over four time periods between 1976 and 2004. This focus is important, as rural areas have faced severe and chronic economic decline over the study period. Their research (specifically for the 1976-1983 and 1991-1997 panels) provides evidence that established community colleges made a significant contribution to employment growth. However, for the most recent panel (i.e., 1998-2004), the coefficient for community colleges is negative. An examination of the interaction between community colleges and states’ fiscal contexts provides evidence that this decline may be the result of states cutting back their funding levels for community colleges.