NCPA - National Center for Policy Analysis

What if the Grads Move Away?

November 30, 2001

State economic development officials often argue that if their states invest more in education, college graduates will constitute a better-educated workforce -- which will attract more high-skilled jobs.

But as desirable as a premium workforce may be, there is a consideration that goes unaddressed: what if those grads move to another state?

Economist John Bound of the University of Michigan and three co-authors say there is a relationship between degree production and the concentration of college-educated workers in a state's population in the long run -- but it's not anywhere near as large as economic development officials might want.

  • A recent study reported that "states awarding relatively large numbers of BA degrees... have somewhat higher concentrations of college-educated workers"; however, the link is relatively weak.
  • Increasing the output of college graduates in a state by 10 percent, say, has a much smaller effect on the education level of the state workforce.
  • College-educated workers are quite mobile and, the study found, are not closely tied to their alma mater at all.

Whatever the arguments for states' investment in education, producing a highly-educated, loyal and permanently-attached workforce may not be one of them.

Source: Michael J. Mandel, "Economic Trends: College-Town Confidential," Business Week, November 26, 2001.


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