Generally speaking, when the economy adds 236,000 new jobs, that’s considered good news. Unfortunately for community colleges, the March jobs report is not exactly what they were hoping for. Most people look at the monthly jobs report and grab the headline numbers: jobs created or lost, percent unemployed, and perhaps the labor participation rate.
The report, which the Bureau of Labor Statistics releases every month, gives out a little more information to anyone who is willing to read what it has to say. The March employment data offer some insight into why community colleges are in for some tough sledding in the months to come.
First, the headline – 236,000 new, non-seasonal jobs. That’s what the BLS says employers added in the month of March. Adding jobs to the economy is good news, unless you’re a community college. Job creation takes people out of the classroom. Robust job creation means they’ll be out of the classroom for a while. Many of those folks who went to work right after high school may never enroll at all.
The second piece of information: 3.5% unemployment. Unemployment in February 2020 was 3.5%. In March 2023, unemployment is 3.5%. The economy is right back where it started, and yet, it’s substantially different.
The employment-population ratio looks at people who are squarely in the “working age” classification. That is, adults between the ages of 25 and 54. The EPR looks at only a subset of the actual workforce, since it excludes workers who may not be fully participating in the workforce, and those who may have retired early or reduced their working hours. The labor participation rate among these workers was unchanged in March, at 83.1%, and the employment-population ratio among this group edged up by two-tenths of a percent.
Monthly jobs reports strongly hints at full employment
This compares to the labor participation rate prior to the pandemic. It indicates the economy has likely achieved full employment among its primary workers.
Other bad news for community colleges includes the average wage decrease. The average hourly wage is an amalgamation of all earnings by all workers in the economy. When the pandemic started, the average hourly wage went up because low-wage workers lost (or left) their jobs, leaving only higher paid workers. The average wage is now dropping, which means the lower paid workers are returning to the workforce.
The Leisure and Hospitality sector, which lost more than 8 million jobs at the onset of the pandemic, posted employment at about 96% of what it had been prior to March 2020. Leisure and hospitality jobs accounted for about one-third of the total jobs added to the economy in March 2023. Manufacturing now exceeds the number of jobs the sector reported in March 2020. The construction industry employs more people now than it did at the onset of the pandemic.
Those three category reports are very important because they reflect jobs that don’t require a college degree. People who might enroll in college are working. Unless the economy or the prospects for a substantially better job give them a reason to do something different, they are unlikely to enroll in college classes. The jobs report for March may be a net positive for the economy, but it spells long-term trouble for community colleges.
The only way to compete against the economy is to develop programs that show more long-term promise than entering the workforce does. As a community, we’re paying the executives at WCC a lot of money. It’s time for them to start producing results.
Photo Credit: Duncan Cumming , via Flickr
