There are so many reasons community colleges need to provide a pathway to high demand, high wage jobs. Unfortunately, the data from Michigan show that community college graduates make on average less than $36,000 annually ten years after they began taking classes.
Part of that is the low graduation rate, which is a problem all by itself. With a community college education, the likelihood of making a living wage declines as time goes on. This directly counters what people need. To buy a home, start a family, or even escape debt, people need employment opportunities that enable wage increases over time. Community college degrees and sub-degree credentials don’t do that. Those credentials typically come with an expiration date, and if workers have not been savvy enough to upskill or reskill before the “timer” runs out on their degrees, they could find themselves back at Square One.
Here’s another reason that community colleges must shift their program focus to high wage jobs: new data from the Pew Research Center shows that fewer than half of all young adults between the ages of 18 and 34 are financially independent of their parents.
Yep. Fifty-five percent of parents in the survey reported that they provide some form of regular financial assistance to their adult children. More than one-third of these parents say that the assistance they’re providing comes at the expense of their own retirement savings.
So, not only does the absence of high wage jobs negatively affect the young adult workforce, but also it cripples the preceding generation in the form of lower retirement savings.
High wage jobs offer a path to financial independence
The inability to achieve financial independence is not the result of lack of post-secondary education. The workers currently described as young adults have more education than any generation that preceded them. The inability to earn a living wage, combined with exorbitant debt acquired in college, mortgage interest or rental housing costs, auto loans, and consumer/revolving debt makes it virtually impossible for more than half of young adults to achieve financial independence.
And this is happening when the economy is “good.” Right now, we have low unemployment, and a relatively low (3.4%) inflation rate as of December 2023. According to Zip Recruiter, the average annual salary in Michigan is about $50,000.
What happens when the economy experiences a downturn? The economy can’t (or won’t) stay in the positive part of the economic cycle forever. From past experience, we know that it doesn’t do that.
Our community colleges have a role to play in securing the economic futures of our young adult workforce. However, to see positive gains, they must develop and offer high wage programs that allow workers to escape the financial realities of the low wage economy.
Photo Credit: Marco Verch
