NCPA - National Center for Policy Analysis


December 15, 2009

In a recent Grand Rapids Press column, Lou Glazer argued that there's a correlation between a state getting more college graduates and enjoying higher statewide income levels.  However, Glazer uses only snapshot views of what the per capita personal income or economic output is in a state right now.  He ignores trends, says James M. Hohman, a fiscal policy analyst with the Mackinac Center.

The U.S. Census Bureau publishes state-by-state information on the percentage of the population with a bachelor's degree, which according to Glazer is the key to state economic growth.  Matching growth in graduates with state income statistics tells a different story than what Glazer is expressing, says Hohman:

  • Between 2005 and 2008, the 10 states that grew their graduate base the most performed no better than the bottom 10 states in per capita personal income growth.
  • The average income growth for both groups was 14 percent.

So much for growing the economy by growing graduates, says Hohman.

If we look at states with the fastest growth in per capita personal income compared to those with the slowest income growth, the facts become even more troublesome for Glazer, says Hohman:

  • The 10 states where the people's income grew the fastest saw the number of degreed residents increase by just 2 percent on average.
  • Meanwhile the 10 slowest income-growth states had 2.8 percent more grads at the end of that period.

So much for fast-growing states growing their graduate populations, says Hohman.

In the past, the Mackinac Center has examined other indicators of state economic and income growth in the light of the number of residents with degrees and found similar patterns.  Indeed, the only way to support Glazer's campaign with empirical data is to do just what he does, which is ignore trends and only look at snapshots.  That may be a good lobbying technique for a particular special interest, but it's a lousy way to make public policy for an entire state, says Hohman.

Source: James M. Hohman, "What It Doesn't Take To Grow Michigan," Mackinac Center, December 11, 2009.

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