A new study by the Public Policy Institute of California suggests the state will fall 1.1 million short of graduates with bachelor's degrees in 15 years if current trends continue.
Here’s how that might happen: most baby boomers will have left the workforce by 2030 and that’ll open up numerous high-skill jobs that require a college degree.
But according to the report, only a third of California workers will have a bachelor’s by then, all things being equal, creating a shortage of over 1 million college-educated workers. Even an influx of educated workers from out of the state will not cover the shortfall, the institute warns.
"California's workforce skills gap is substantial," said Hans Johnson, PPIC senior fellow and an author of the report, in a written statement. "But if we can improve educational outcomes, the benefits are significant — higher incomes for residents, lower demand for social services, and a more competitive California economy."
According to the report, demand will grow most in jobs that require skills in business, finance, computer science, and math.
However, success in the future may not favor all college graduates. For graduates with degrees in engineering and computer science, the gain in wages over a lifetime can add up to more than $1 million, the institute said. That same lifetime wage premium for college degrees with the lowest economic return may total more than $200,000.
To prevent a college graduate shortage, the institute recommends California’s public colleges and universities push to enroll more students, improve graduation rates, increase community college to university transfer rates, and provide financial aid to cover expenses that lead to student debt.
The study singled out the need for better transfer rates between the 460,000-student California State University system and the 2 million-student community college system.
PPIC recommended more community colleges and four-year universities enter into agreements to guarantee community college students a transfer to a four-year university, if they meet certain requirements.
But that's not enough, the institute said. Once they are admitted to a four-year institution, students need help to get to graduation day. Completion rates in the state’s community colleges and California State University are low. About half of community college students earn their associates degrees or transfer to a four-year university. But nearly half of students who started as freshmen in Cal State's 23-campus system hadn’t earned their degree six years later.
For their part, CSU administrators are working on improving support to students to raise the graduation rate to 60 percent by 2025.