States Reap Quantifiable Benefits through Investments in Higher Ed

The same benefits of higher education to society and individuals found on a national level also are evident at the individual state level and need to be taken into account in state policy discussions, including those on state funding, says a new report from the Institute for Higher Education Policy (IHEP).

Using data from the U.S. Census Bureau, The Investment Payoff: A 50-State Analysis of Public and Private Benefits of Higher Education, measures societal and individual benefits of higher education on a state-by-state basis across six indicators. For each state, benefits are documented for residents by education level, ranging from those with a high school diploma to those with a bachelor's degree or higher. The report concludes that almost every state benefits from higher education in all indicators measured, although some states reap more than others.

According to IHEP, national averages show that these benefits are widespread and dramatic. In March 2004, six percent of the population age 25 or older with a high school diploma was unemployed, compared to only 3 percent for those with a bachelor's degree. Societal benefits of citizens with a college degree include decreased reliance on public assistance, higher voting rates, and increased volunteering, while individual benefits include higher income, lower unemployment and better health, the study indicates. The state's economy also profits through increased tax revenue, greater productivity, and increased workforce flexibility.

"This study shows that state investment is not only worthwhile, but has significant return benefits that are quantifiable," said Jamie Merisotis, president of IHEP. The study builds on previous efforts to measure benefits, using six indicators from a broader list identified in national-level research -- personal income, unemployment rates, receipt of public assistance, health status, volunteerism, and voting participation.

The scope of the effort is purposely narrow, the authors state, and does not attempt to rate state performance, draw inferences regarding causal relationships, or explain why some states fared better than others. Rather, it offers a detailed historical perspective and catalog of benefits, suggesting that further efforts should be undertaken to develop specific and quantifiable indicators of the value of higher education at the state level. The report is available from IHEP at: http://www.ihep.org/