Education Forward Arizona and the Helios Education Foundation recently released a report on the economic benefits of higher education in Arizona, which found that increasing levels of education had a positive fi nancial impact at both the individual and state level.
The report, called “Billions to Gain: The Economic Benefits of Investing in a More Educated Arizona,” used a model to project how higher education would affect a cohort of Arizona public high school graduates (68,690 total) across their lifetime.
It then looked at the economic benefi ts of varying levels of higher education in three categories: individual, social and fiscal impacts.
“We’re getting beyond the value of college to just be personal gain for an individual and this research puts into context the specific economic gains to our state, to our communities,” said Paul Luna, president and CEO of Helios. “…This starts to provide a very strong case as to why equal opportunity, equal access for every student to go to college is relevant and important to each and every one of us that lives in the state of Arizona.”
The report found that high school graduates will earn on average $679,000 over their lifetime, while those completing an associate’s degree will earn $966,000 and bachelor’s degree recipients will earn $1,531,000 — almost two and a half times more.
Social and fiscal impacts have to do with different aspects of the way college education can have a broader effect, particularly at the state level. Savings on health and criminal justice expenses are examples of the former, while federal and local tax impacts fall into the latter category.
Individually, the report found, those with a bachelor’s degree will contribute $982,680 more in social gains and $356,200 in fiscal gains than a high school graduate over the course of their life.
Per cohort, a 10% increase in college completion will result in $1.37 billion in social impacts and $0.52 billion in fiscal impacts, while a 20% increase in college enrollment will result in a $5.09 billion social impact and a $1.82 billion fiscal impact.
“The model doesn’t say whether college completion is a more important goal than college enrollment,” said Clive Belfield, a professor of economics with Queens College, City University of New York. “It says, either way, college enrollment or college completion, you’re going to get a billions of dollars magnitude effect if you can bring about those increases.”
In Flagstaff, the report found that a 10% increase in college completion would result in an additional $5.82 million social impact ($9,310 per individual) and a $1.6 million fiscal impact per cohort ($2,560 per graduate). Increasing college enrollment 20% would add $3.89 million in social impact ($62,250 per high school graduate) and $12.23 million in fiscal impact ($19,580 per graduate) for each cohort.
A 20% decrease in college readiness, however, would result in a loss of $68.72 million in social impacts per cohort ($109,980 per graduate) and $21.86 million fiscal loss per cohort ($34,990 per individual).
The COVID-19 pandemic also created losses in college readiness and attainment (due to a combination of lost schooling and reduced productivity from multiple causes) which the report also analyzed through an economic lens. For each cohort, a year of lost college readiness has a $3.56 billion fiscal impact and a $9.46 billion social impact, while a oneyear reduction in attainment has a $2.33 billion fiscal impact and a $6.19 billion social impact.
These gains also vary by economic sector, with the report specifically looking at advanced manufacturing, cyber technology, healthcare and financial services, which all have higher employment growth than across all fields statewide. Of these, healthcare had the largest gains per graduate in both social ($686,000) and fiscal ($245,240 impacts).
One of Education Forward’s goals, established in 2015, is to reach a 60% postsecondary attainment rate across the state by 2030. Its Education Progress Meter shows attainment increasing almost 2% between 2019 and 2021, to 47.9% in 2021. Rich Nickel, the organization’s president and CEO, said every percentage point is equivalent to about 55,000 new degrees statewide.
“The byproduct of pursuing that goal is already showing itself in massive ways, even though the percentage point gains may be small,” he said. “…The progress is being made now and it’s certainly worth the investment people are putting into it.”
One approach to raising Arizona’s attainment rate, according to the report, was to work towards achieving racial parity in college completion rates. It found that achieving parity in four degree completion would result in an additional $8.69 billion in social gains per cohort, as well as an additional $3.29 billion in fiscal gains. Achieving parity in college enrollment would add $574 million in social gains and $209 million in fiscal impacts.
Other current initiatives mentioned as moving toward higher attainment in Arizona included the Arizona Promise Program and increased investment in dual enrollment across the state.
The full report can be found at helios.org/billions-to-gain.
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