Performance Needed to Close the 2020 College Attainment Gap
between the U.S. and the Most Educated Countries

Prepared for the Schott Foundation for Public Education by the
National Center for Higher Education Management Systems (NCHEMS)

The College Attainment Gap

In February 2009, President Barack Obama told a joint session of Congress: “By 2020, America will once again have the highest proportion of college graduates in the world”.  A driving force behind the President’s statement were data published annually by the Organisation for Economic Cooperation and Development (OECD), which revealed that the U.S. was ranked 10th among developed countries in the percentage of its young adults ages 25 to 34 with college degrees (associate and higher).   More than half of the young adults in the leading countries (Canada, South Korea, and Japan) had earned college degrees compared to less than 40 percent in the U.S.  The attainment rate among young adults in the U.S. has largely leveled off, while substantial progress is being made by these countries. If the trends continue, it is reasonable to estimate that the leading countries will be approaching college attainment rates of 60 percent in their young adult populations by the year 2020. To be well-positioned, the U.S. should aspire to the same rate. 

In April of 2010, NCHEMS worked with education staff from the Obama administration and the National Center for Education Statistics (NCES) to determine the size of the college attainment gap that needs to be closed by 2020 in order to realize the goal; and how much improvement in college degree production each state would need to contribute toward meeting the goal.  The full report can be accessed at http://www.nchems.org/pubs/detail.php?id=129. 

The following brief describes the analytical methods used to determine the college attainment gap, the contributions to be made by each state, and the investments needed to education - in K-12 and postsecondary education - in order to achieve the goal.  It is written with support from the Schott Foundation for Public Education to explain the methods used to derive the numbers used in the report entitled "2020 Vision Roadmap: A Pre-K through Postsecondary Blueprint for Educational Success."

Calculating the Degree Gap for 25 to 34 Year Olds

When estimating the additional degrees the U.S. will need to close the gap, current degree production and population growth must first be taken into account. The following calculations show how the U.S. “degree gap” (associate and bachelor’s) was derived.

1. Current % of Adults Aged 25 to 34 with College Degrees (2008): 37.8%
2. Average Annual % Change from 2000 to 2008: 0.34%
3. 2020 % with Average Annual Change Applied to 2008 base: 41.9%
4. Projected 25 to 34 Year Olds in 2020: 45,065,697
5. Additional Degrees Needed to Meet Goal = (60.0 - 41.9%)*45,065,697: 8,165,954
6. Current Production of Associate and Bachelors (2007-08): 2,313,233
7. Annual Percent Increase Needed: 4.2%

• In 2008, 37.8 percent of adults aged 25 to 34 in the U.S. had college degrees – associate and higher (source: 2008 American Community Survey).
• From 2000 to 2008, the college attainment rate in the U.S. improved 0.34 percentage points annually. When this is applied annually from 2010 to 2020, the U.S. is projected to have an attainment rate of 41.9 percent in 2020. This may be an overestimate, however, because there has been no increase in attainment over the most recent four years – from 2005 to 2008. (sources: 2000 Decennial Census and 2005-2008 American Community Surveys).
• The latest population projections from the U.S. Census Bureau estimate there will be 45,065,697 residents aged 25 to 34 in 2020 (for the 50 states and the District of Columbia). The 2020 degree gap is calculated as the degree goal minus the projected attainment rate, times the projected young adult population: (60.0 percent minus 41.9 percent) times 45,065,697. This yields a degree gap of nearly 8.2 million – the additional number of young adults with college degrees needed to close the gap between 41.9 and 60 percent.
• The U.S. currently produces more than 2.3 million associate and bachelor’s degrees annually (2007-08 NCES, IPEDS Completions Survey). To make consistent progress toward the target, using a compound interest approach, U.S. degree production needs to increase 4.2 percent annually.

 Contributions to be made by States

The following calculations are made to determine the degree production needed by each state to close the nation’s gap of 8.2 million degrees by 2020 (using Alabama as an Example). The calculations are based on each state’s current share of degree production, and then adjusted for different educational attainment levels and population projections:

1. Alabama currently produces 1.4 percent of the nation’s associate and bachelor’s degrees (NCES, IPEDS Completions Survey 2007-08)
2. Prior to any adjustment, if Alabama were to maintain its current proportion of the nation’s degree production, it will produce 115,148 additional degrees – over and above current production – by 2020 (1.4% times 8.2 million)
3. Two index scores are created for each state in order to adjust their contribution to the national goal, given their projected population growth and current levels of educational attainment:

   Population Growth Adjustment Index: projected 25 to 34 year olds in 2020 as a percent of the state’s current 24 to 34 year olds, divided by the same calculation for the U.S. (Alabama 97%/U.S. 108% = 0.89). Alabama’s young adult population is projected to grow at a slower rate than the U.S. average. States that are projected to grow faster than the U.S. have index scores that are greater than 1.0.

   Educational Attainment Adjusted Index: percent of 25 to 34 year olds with an associate degree or higher in the U.S. divided by the same percentage for the state (U.S. 37.8%/Alabama 31.8% = 1.19). Alabama’s young adult population is less educated than the U.S. average, which yields an index value greater than 1.0. States that have young adults who are more educated than the U.S. have index scores that are less than 1.0.

4. The adjustments for the state contribution to the national goal are then applied to the baseline degree production estimate from step 2; so Alabama’s proportion of the U.S. 8.2 million degree gap is calculated as the baseline degree production (115,148) times the population growth index (0.89) times the educational attainment index (1.19) = 121,812 additional degrees to be produced by Alabama by 2020.
5. Alabama currently produces 32,619 associate and bachelor’s degrees annually (2007-08 NCES, IPEDS Completions Survey). To make consistent progress toward the target, using a compound interest approach, Alabama degree production needs to increase 4.4 percent annually.

The calculations for each state are shown in Appendix 1.

Performance Needed by the U.S. and Each State to Close the College Attainment Gap

Shortly following the report written in April 2010, NCHEMS constructed a "student flow" model for the U.S. that determines the levels of performance that are needed in the education pipeline to close the 8.2 million degree gap. Included in the model are measures for college participation and completion. The participation measures include high school graduation rates, college-going rates directly out of high school, and college participation rates among older adults aged 20 to 39. The completion measure is the number of undergraduate degrees awarded per 100 full-time equivalent undergraduate students (for public two-year, research, and bachelor's and master's colleges; and private four-year colleges). The model also takes into account the projected growth among high school students between now and 2020, as well as the projected growth among 20 to 39 year olds.

The user interface (dashboard) of the model is shown in Figure 1 below. By increasing the performance of each measure on the dashboard, users can test the impact that each has on the production of additional college degrees - and ultimately create different scenarios using multiple measures to estimate what levels of improvement are needed to close the 8.2 million degree gap by 2020.

A variety of models like the one displayed in Figure 1 have been developed in the past year. In the fall of 2010, NCHEMS developed similar models (with support from the Lumina Foundation) for the U.S. and each of the 50 states. These models include a mechanism for estimating the costs of achieving various college attainment goals - namely the additional state revenues needed to support the higher education enterprise at current dollars per Full-Time Equivalent (FTE) student. These models can be accessed at www.collegeproductivity.org.

Figure 1: NCHEMS Student Flow Model for Closing the College Attainment Gap

Appendix 2 provides the results of "modeling" each state to achieve the levels of degree production needed to meet the national goal - i.e. the contribution needed from each state described above and shown in Appendix 1. For the U.S. and each state, the measures of performance (for participation and completion) were increased at the same rate until the college degree gaps were closed; placing equal emphasis on all measures. The exceptions were for states that are already best-performers on measures; in which cases more improvement was modeled on other measures.

Increasing High School Graduation

GPS expressed particular interest in the PK-12 performance needed to meet the 2020 college attainment goal - for the U.S. and each of the states. To date, much of the attention given to the goals and the modeling efforts has been directed at the postsecondary enterprise. The secondary education system is still the largest direct supplier of students to postsecondary institutions. The majority of college students enter directly out of high school. Therefore, reducing the number of high school dropouts (who aren't even eligible to enter postsecondary education) between now and 2020 is critical to achieving the overall goal. The most recent data available from NCES reveal that just over 70 percent of 9th graders complete high school within four-years (Figure 2). And more 9th graders drop out in each subsequent year of high school.

Figure 2: The Percentage of U.S. 9th Graders Who Persist to Subsequent Grades and On-Time Completion

In order for the U.S. to achieve its college attainment goal, much higher percentages of 9th to 12th graders must be retained until graduation - displayed in the red bars above. This will result in more students achieving the most basic prerequisite for college, but will also add substantial enrollments in high schools in many states.

Figure 3 displays the projected enrollment in PK-8 and 9-12 grades in the U.S. (using data from NCES). It also displays the additional 9th-12th graders that need to be retained in the system in order to achieve the high school graduation rate target in Figure 2 above. The detailed data for the U.S. and each state are shown in Appendices 3-5. As you might imagine, PK-12 enrollment in some states is projected to decline between now and 2020.

Calculating Costs

Without a great deal of insight into cost-cutting strategies being entertained or implemented in each of the 50 states, the estimated public costs associated with achieving the 60 percent college attainment goal are simply derived from current public revenues made available to PK-12 and postsecondary education per student ("business as usual"). What will it cost states, localities, and the federal government to fund the additional enrollments needed to achieve the 2020 goal (at current $ per student)?

Therefore, the estimated costs of achieving the 2020 goal in the U.S. and in each state is calculated as "additional students enrolled * current public revenues per student" (between 2011 and 2020). The revenues per student in PK-12 education (adjusted to current $) are displayed in Appendix 6. The revenues per student in postsecondary education were derived from the 2009-10 NCES' Integrated Postsecondary Education Data System Finance Survey.

The cumulative estimated costs between now and 2020 for PK-12 and postsecondary education are displayed in Appendix 7 - for the U.S. and each state. Also, included in Appendix 7 are the numbers highlighted in the GPS report.

Appendix 1: How Each State Should Contribute to the Goal of Producing 8.2 Million Additional Degrees by 2020

Adjusting for Current Levels of Educational Attainment and Population Growth by State
Source: NCHEMS, Closing the College Attainment Gap between the U.S. and Most Educated Countries, and the Contributions to be made by the States (April 2010). Click image for larger verison.

* State Projected 25 to 34 Year Olds as a Percent of Current 25 to 34 Year Olds / U.S. Projected 25 to 34 Year Olds as a Percent of Current 25 to 34 Year Olds
** U.S. Educational Attainment / State Attainment
*** Column C x Column E x Column G

Appendix 2: Performance Needed to Meet the 2020 College Attainment Goal

Source: NCHEMS Student Flow Models. Click image for larger version.

Appendix 3: Projected Change in PK-8th Grade Enrolment from 2012 to 2020 (Above/Below 2011 Enrollment)

Source: NCES, Projections of Education Statistics to 2020 (Table 8). Click image for larger version.

Appendix 4: Projected Change in 9th-12th Grade Enrollment from 2012 to 2020 (Above/Below 2011 Enrollment)

Source: NCES, Projections of Education Statistics to 2020 (Table 10). Click image for larger version.

Appendix 5: Change in 9th-12th Grade Enrollment Needed to Meet High School Graduation Rate Goal in 2020 (Above/Below 2011 Enrollment)

Source: NCES, Projections of Education Statistics to 2020 (Table 10); National Center for Higher Education Management Systems. Click image for larger version.

Appendix 6: Calculating State, Local, and Federal Revenues for K-12 Education per Student

Source: NCES, Revenues and Expenditures for Public Elementary and Secondary Education: School Year 2008–09 (Tables 1 and 5). Click image for larger version.

 Appendix 7: Summary of Results - Data Used in the Schott Foundation for Public Education Report

Click image for larger version