Michael Hicks: Indiana is falling behind Mississippi


Readers of this column know that I am deeply concerned about the rapid decline in college attendance in Indiana. This is the deepest economic problem Indiana now faces, and it risks defining the state’s economy for much of the 21st century. After all, the children whom we invest in today will have a 50-year work life. So, today’s high school students will still be working in large numbers in 2070.

Over the past few years, in this column, and in technical studies, I’ve offered considerable evidence about the risks for Indiana. I’ve reported the fact that the U.S. has not created a net new job for anyone who has not been to college for 30 years. I’ve noted that during this time the college wage premium actually grew, confirming that there remain fewer college grads than labor markets can absorb. I’ve explained that nearly all the economic growth in the U.S. is clustered in a few hundred counties with very high shares of college grads.

These facts are just the highlight of a large assembly of evidence that we should be better educating young Hoosiers. I write this in a puzzling environment where a surprising number of policymakers from local school boards to the legislature dismiss the importance of higher education. They are dangerously mistaken.

It is worth noting that I am not especially concerned about the survival of individual institutions of higher education. I’m not writing this to boost Ball State’s enrollment. No one at the university has ever asked me to write a column on this issue, or indeed any issue. Colleges should be competing for students on price, quality and offerings. Public universities should also worry about serving other interests in research and expanded opportunity for citizens. Private schools have no such obligation.

I’m also not especially worried about individual students who choose not to attend college. For most of us, happiness and satisfaction in life are not tied to completing higher education. No matter how much education we pursue, most of us keep on learning and growing long after we leave school. I’ve never seen a tombstone with a college degree on it. They do memorialize faith, marriages, children and military service.

Most kids who decide not to further their education will be fine. This is an extraordinarily rich nation, and even adults whose incomes remain stagnant over the next 50 years will be among the most prosperous people to have ever lived. Still, lack of post-secondary education will drag down earnings, increase the probability of cyclical joblessness and heighten risk of job losses from automation. There are many other negative outcomes from skipping college, which I’ll save for another column.

The real concern I have is that places with a low share of adults who’ve gone to college will stagnate. They’ll experience more economic inequality and continue to fall behind those places that educate more of their population.

One way to really get the gist of the importance of education is to consider the past 50 years of technology in the workplace. In 1973, robots were scant, desktop computers still a distant vision, and calculators were slide rules. There were no cell phones, digital devices, no algorithms for advertising. No industry or occupation is untouched by the giant steps in technology that we’ve experienced over the past half-century.

The 50 years before that were equally fantastic, as were the 50 before that, and the 50 before that. We are in the midst of a two to three-century explosion of technological advances. There is no evidence of a slowdown.

On the contrary, all the world is rushing to educate their young people. In the second half of this century China, India, South Africa, Brazil, Nigeria and Iran will have made enormous educational gains. We will see more genius unleashed on the globe in the coming decades than in any time in history. We should expect the next half century to offer as much job-morphing technological wonder as any in the past.

Now, ask yourself about the skills a high school graduate had before 1973 and how adequate they are to the modern workplace. One need not do a skill inventory to appreciate that — just ask some of us who were in school in 1973 how well we program our VCR. That many of us still have a VCR should tell you all you need to know.

The efforts to streamline schooling to get students into work earlier appears wholly uninformed by the reality of the 21st century, the 20th century or the 19th century. Moreover, the push toward vocational education and away from college is deeply cynical.

I hear a lot of elected leaders suggesting college is not important and that there are plenty of available jobs without additional schooling. But, none of those folks are living out that reality in their own lives. When it comes to pushing students into the vocational track, the loudest voices across the state have elite academic credentials themselves.

I haven’t heard a single one of them ask their children to give up college to drive a truck, work in a canning factory or run a CNC machine. Again, there is nothing wrong with these occupations, but it is almost as if the folks promoting a vocational pathway have something other than the best interest of other people’s children in mind.

The next time you hear someone running for office talking about how many jobs there are in the warehouses, trades or manufacturing, ask what their children did after high school. Of course, you know the answer, but ask them anyway. At best, this is sloppy thinking. It is already causing long-term damage to the Hoosier economy.

Back in 2010, Indiana spent a modest 0.67% of state GDP on higher education. At the time, our share of students going to college was rising toward the peak of 65.8%. Both money and attendance has dropped substantially in the ensuing years. By Fiscal Year 2021, the state government spent 0.52% of GDP on higher education. That is a cut of almost $600 million per year. Over the same time period, Mississippi raised their spending from 2.3% to 3.0% of GDP, and increase of $786 million per year.

Folks, that is why Indiana now sends 52.9% of high school graduates to college, while Mississippi sends 81%. Today, Mississippi is a poorer, less well-educated state than Indiana. But, by my calculations, that will change in a little over a decade. On the bright side, at that point, our Mississippi strategy will finally be aspirational.

Michael J. Hicks is the director of the Center for Business and Economic Research and the George and Frances Ball Distinguished Professor of Economics in the Miller College of Business at Ball State University. Send comments to [email protected].

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