An Economic Impact on Community College

RUNNING HEAD: AN ECONOMIC IMPACT ON COMMUNITY COLLEGES 1

An Economic Impact on Community Colleges

Leadership in Higher Education Administration

Cara Comer

John Brown University

An Economic Impact on Community Colleges 1

Introduction

As a research topic this paper explores the economic effects of the 2007 recession on

higher education and on community colleges in particular. Since the recession, community

colleges have felt enormous impacts, both positive and negative.

From one perspective, community colleges have been fortunate, as they have experienced

increased enrollments. Having become a popular destination, in part, because of their lower

tuition costs in comparison to four-year colleges and universities, they are also typically more

accessible to the general population (Tellefsen, 2011).

Another factor that has influenced community colleges is increased unemployment. As

the recession hit home for many, and individuals lost their jobs, they turned to community

colleges for a chance at an education, or to become more marketable in the workforce (Tellefsen,

2011).

The downside to this surge in enrollment has been a decline in student success rates.

Unfortunately many newly enrolled students are unprepared for college-level work. Fewer than

half of all students earn a degree within six years; even worse, are the statistics for students who

attend community college. A report from the Higher Education Policy Commission in West

Virginia states that fewer than 28 percent of students at two-year institutions actually earn an

associate degree or certificate within six years of entering school (Tellefsen, 2011).

Over the course of this research, it seems that the fundamental issue with community

colleges shifts from a direct financial crisis resulting from the recession, to the current post-

recession situation that these institutions have found themselves in. The problem is not getting

students into school, but keeping them there and increasing their probability for future success.


Financially, community colleges do find themselves in a bind, and therefore face

continuous challenges that make improving success rates and promoting quality education

difficult. However, with careful budget planning, caring administrators and faculty, and students

who are willing to invest plenty of time and energy into their educations: community colleges

can work to build academic preparedness and support systems that allow new students to succeed

in obtaining their degrees and certificates and allow them to move on to the next chapter in their

lives, whether that be directly entering the workforce or moving on to a four year college or

university (Tellefsen, 2011).

The Great Recession

Just as the Great Depression swept through the United States in 1929, Americans today

recall what has come to be known by many as, the Great Recession. The recession began in

December of 2007 (Jubak, 2012) and although the economy has picked up, since the declaration

of its end in the summer of 2009, its impact is still recognizable in many aspects of life.

Financial crisis in recent years has failed to reach the peak of the Great Depression.

However, Americans have been confronted with unemployment rates of 10.1% as of October of

2009 (Jubak, 2012). According to Jim Jubak, a reporter for MSN Money, the Economic Cycle

Research Center had predicted that the United States would fall back into a state of recession in

2012. Although that did not happen, Jubak expresses his concerns by saying that “even if we’re

not officially in a recession at the moment, the downturn has already been long enough and

painful enough here, that I think it’s worth asking if the Great Recession has produced any

lasting changes.” In response to his own question, the author answered yes and expressed the

following three post-recession concerns (Jubak, 2012).

- Frugality – People want to spend less, lowering consumer spending


- Jobs – Unemployment rates and unskilled workers persist

- Retirement Benefits – Individuals are more concerned for their future

As America struggles to return to its feet, chances are that countless individuals share

these same concerns. As a remedy to recent hardships, many look to education for the answers.

How then, have institutions themselves dealt with the downturn of the economy and what can

they do to aid in the relief of the American people?

Higher Education

At the beginning of the recession the question was raised as to what the effects would be

for students, as well as, institutions of higher learning themselves. After all, with financial

burdens already at play, who could afford to go to college? However, over time, it became

evident that college enrollment was actually on the rise (Tellefsen, 2011).

A report by the National Student Clearinghouse Research Center states that there was a

6.8 increase in new student enrollment, from 1.997 million in 2006 to 2.135 million in 2010.

Across the board, public, private, two-year and four-year institutions managed to keep the status

quo or actually increased enrollment when times were extremely tough (Tellefsen, 2011).

Community College

Community colleges in particular have felt the unexpected phenomenon of increased

enrollment since the recession. Historically community colleges have been known to serve all

kinds of students, as opposed to their counterpart universities who focus mainly on high school

graduates (Chen, 2011).

Until recently, it was unclear as to why community colleges were affected differently

then four-year institutions. According to a study conducted by the National Student

Clearinghouse Research Center titled “Understanding the Recession’s Impact on U.S. College


Enrollment and Persistense Patterns,” it was determined that more students enrolled in

community college for simple reasons. They are both practical and affordable. Some of their

practical attributes are their location, broad curriculum and size (Chen, 2011).

High school graduates, since 2006, have been less likely to consider four-year institutions

over community colleges. In 2009, 44.5 percent of traditional-age, first-time students enrolled in

two-year institutions. Although it is suggested that many students enroll in community colleges

only to avoid high tuition costs, many people believe that these institutions hold the key to a

brighter future, not only for students, but for the United States Economy (Tellefsen, 2011).

The Opportunity

President Barack Obama has taken a legitimate interest in community colleges in the last

few years. According to Richard Kahlenberg in the article, “Community Colleges and the State

of the Union,” the president hopes to restore social mobility and make the United States the most

educated country in the world (Kahlenberg, 2012).

During his 2008 presidential campaign, Obama paid a visit to over 30 community

colleges. What he found at these institutions were the trade schools responsible for the

development of 59% of the United States nursing students, as well as, innovative industries like

wind-farm technology and video-game design. He also discovered numerous other programs that

could undoubtedly aid in the development of skilled workers. After recognizing the benefits of

the community college, the president emphasized the use of these institutions as one of the best

tools the United States can use to repair its economic state (Fitzpatrick, 2009).

In the 2012 State of the Union address, President Obama recognized the issue of

hardworking Americans, who are unable to fulfill their dreams due to financial hardships. He

described this unfortunate phenomenon as, “the defining issue of our time.” The president went


on to add that he hoped to restore equal opportunity for individuals of all backgrounds and

pledged to “give more community colleges the resources they need to become community career

centers (Kahlenberg, 2012).”

In addition, appointed by the president, Jill Biden leads a public relations campaign used

to bring awareness to the citizens of the U.S. about the influence that these schools can have on

the American workforce and the economy as a whole. Since, 2008, the President has declared his

plan to help every American get at least one year of college or vocational training (Fitzpatrick,

2009).

The Problem

Unfortunately, as community colleges face record enrollment highs, they are plagued by

financial constraints and faltering student success rates. Although community colleges were

designed with the intent of allowing all people the opportunity to further their education, they

struggle to keep up financially (AACC, 2012).

Two-year institutions are typically funded by state and local government and depend on

these sources for approximately 55 percent of their revenue. Spending somewhere around

$13,000 annually per full-time student, they average considerably below expenditures at four-

year colleges and universities. By raising tuition, four-year institutions compensate on a per-

student basis for recent reductions in state and local funding. However, community colleges

usually offer low tuition as part of their commitment to access, and are negatively affected by

surging enrollments. According to the American Association of Community Colleges, “the issue

is not about spending less, but about getting better value for the dollars expended (AACC,

2012).”

The lack of financial resources in community colleges leads to the decline in student


success rates. Research shows that this could be especially true for students who are middle-

class, low-income and of minority ethnicity. Fewer than half of students who attend community

colleges in hopes of obtaining a certificate or degree actually move on to the next level within a

two-year time period. Instead, many drop out or are still enrolled in part-time courses six years

down the road (AACC, 2012).

Retention and Success

An administrative strategy that would likely improve the learning outcomes in the

community college would be similar to that of an effort going on in West Virginia. West

Virginian leaders of higher education have shifted recruiting resources, to student retention and

success rates (Boucher, 2013).

In order to ensure that students who chose community college get what they pay for,

administrators at these institutions must look to use their resources differently. That could mean

reorganizing their institutions mission, vision and values and reestablishing goals. For example,

shifting efforts from recruiting to retention, and completion.

In West Virginia, it was reported that fewer than 28 percent of community college

students earn an associate degree or certificate within six years of entering for the first time. This

number has been attributed, in large, to a lack of preparedness upon enrollment. Many students

are simply not ready for a college-level curriculum out of high school. Other students report that

they are discouraged, confused and overwhelmed by the admissions process and that they

received little assistance in the degree planning process (Boucher, 2013). Although an estimated

76% of community college students are underprepared for college level work, most of them

never use tutoring or mentoring services (AACC, 2012).


Proposal

These issues, perhaps originally stemming from the economic influence of the recession,

are seemingly at the heel and responsibility of community college administrative leadership.

With or without additional funding, institutional leaders can improve the quality of education and

prepare students for success in their academic goals.

Culture:

The first step in this process would be implementing a change in culture. “Change

creation,” as noted by author Dale Lick, “is the process by which an institution and its people

accept and welcome change as a vital component in achieving future success, define the future

they want to design and deliver, develop and implement a comprehensive transition plan to

create the designed future, and continuously improve and move ever closer to the desired future.”

(Lick, 2002)

From the top down, college leaders can implement changes that shift institutional culture

from one paradigm to another (Lick, 2002). For instance, a community college that has been

percieved as an institution that strives on enrolling as many students as possible with little

student support and has instructors that care only about the subjects they teach, rather than

student success; can be restructured and organized so that its very essense breaths the words,

“We care about you and we want you to succeed!”

This change would start at the heart of the instituion, which could be described as the

overall purpose of the institution, or its mission. At JBU, the motto “Head, Heart, Hand”, has

permiated the institution from its beginning. Students, faculty and administrators have always

been taught the importance and value of these three gifts. Although, the structure of the

organization has changed over the years, the heart of the institution remains the same. The words


“Christ Over All,” will continue to influence the success of the institution because the culture is

built around them (Gumport, 2012).

With student success in mind, one of the most practical ways to change culture and one

of the best things that administrators and faculty can do for struggling students is, to talk to them.

Communication was listed as one of 2013’s must-have job skills in The Wall Street Journal

(Mantell, 2012). Why should college administrators and faculty be the exception? Subjects

students should hear about include the local economy, job statistics, trends, expected income and

career possibilities upon graduation. Students would seemingly be more likely to succeed, with

increased connectivity and support from college leadership (Gumport, 2012).

Budgeting:

Additional program needs, such as; enlarged facilities, additional learning materials and

tools, teaching resources and other direct and indirect costs, obviously do require money. In a

situation where budgets are seemingly being cut on an annual basis, as is the case in many

community colleges (Jubak, 2012), careful budget planning with existing funds is imperative.

Although difficult, in times of financial hardship institutional decision makers must focus

on prioritizing curricular and non-curricular programs. Unfortunately, some institutions will

ultimately face cutting programs, terminating employees, eliminating positions and reducing

wages in order to implement new programs that coincide with their overall mission (Beers,

2012).

Reviewing subsidies may be another step in the right direction. By keeping a record of

students who utilize or benefit from specific programs or services, evaluating the value added

and learning outcomes for students, as well as, comparing these factors to the overall costs of the

program; adminsitrative decision makers can effectively decide what programs should be


continued, improved upon and discontinued. Evaluating these programs and services will also

enlighten leaders as to what new initiatives could be beneficial to their institution (Gustavson,

2012).

For instance, with unemployment rates still higher than Americans would like to see,

community colleges and students might benefit from establishing programs that cater to

minority, low-income, adults and displaced workers. These programs could be designed around

academic support that focuses on retention, job placement and professional development.

Students who are developmentally unprepared for college level work, might also require more

attention and support than basic remedial course work.

Conclusion

Although the United States economy certainly plummeted during the Great Recession,

institutions of higher learning were met with unforeseen circumstances. Although positive

growth patterns emerged, financial hardships worsened. Especially in community colleges were

much financial support comes directly from state and federal sources.

Community colleges have also faced unique circumstances as people from every walk of

life have sought refuge. This diverse group of students has presented specific issues that require

much thoughtful consideration and action from administrative leaders at these institutions.

From high school graduates who recognize the value of entering a two-year school, to the

displaced worker who looks to an education for a second chance, individuals everywhere hope

for a brighter future.

Unfortunately success rates in community colleges are dreadfully low; circumstances that

cannot be judged from one person to the next, the cause. As college leaders proclaim the


importance of life long learning, it is there responsibility to enhance the learning outcomes of all

students.

Monetarily supported, or not, community colleges can first make changes to improve the

culture of their institutions to nurture and provide the basic support and confidence that students

need. Secondly, budgetary adjustments can be made in order to provide the programs and

services that promote degree completion and facilitate success.

With more education, a better skilled workforce and academic preparedness the future can look

to an improved economy.


References

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February 17, 2013, from American Association of Community Colleges:

http://www.aacc.nche.edu/AboutCC/21stcenturyreport/21stCenturyReport.pdf

Beers, S. (2012). Collaborative Discernment. In S. T. Beers, T. W. Herrmann, & P. Blezien

(Eds.), Funding the Future (pp. 93-102). Abilene, Texas, USA: ACU Press.

Boucher, D. (2013, February 12). Statehouse News. Retrieved February 17, 2013, from The

Charleston Daily Mail: http://www.dailymail.com/News/statehouse/201302110250?

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Chen, G. (2011, July 21). Articles. Retrieved February 17, 2013, from The Community College

Review: http://www.communitycollegereview.com/articles/369

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Jubak, J. (2012, June 11). Investing. Retrieved February 17, 2013, from MSN Money:

http://money.msn.com/investing/how-the-great-recession-changed-us-jubak.aspx

Kahlenberg, R. (2012, January 25). Innovations: Community Colleges and the State of the Union.


Retrieved February 18, 2013, from The Chronicle of Higher Education:

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Lick, D. W. (2002). Leadership and Change. In L. S. Albert, S. Stetson Clarke, R. M. Diamond,

S. C. Ehrmann, J. Eison, L. F. Gardiner, et al., & R. M. Diamond (Ed.), Field Guide to

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Documents

An Economic Impact on Community College