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The Value of a Community College Credential in Washington State

When looking at the economic value of education, researchers tend to look at the impact of a high school diploma or a bachelor’s degree. On average, a person with an undergraduate degree earns $1 million more in lifetime wages than a person with only a high school diploma. The economic return on investment for community and technical college students receives little attention in this discussion. Recently more in-depth research has been undertaken by the Community College Research Center to determine the economic value Washington State community and technical colleges provide their students.

A longitudinal study was conducted to see how outcomes in community college impact future earnings for the multiple pathways offered in community colleges. The study compared earnings and employment data for Washington State community college students from their initial time of enrollment in 2001-02 to seven years after first enrolling in school. The study tracks students’ employment status, hourly wages, and total earnings to determine the average financial benefit earned by community college students who attain a short-term certificate (less than one year to complete), long-term certificate (a year or more to complete), or an associate’s degree. These outcomes were compared to a baseline of students who attended community college, but didn’t attain a short- or long-term certificate or an associate’s degree.

The researchers found that by completing an associate degree or long-term certificate, a student’s likelihood of employment and earning are positively impacted. Female graduates experienced more significant benefits from long-term certificates and associate degrees than their male counterparts. In contrast, short-term certificates were found to have no impact on the likelihood of employment or hours worked. Within a given credential level (associate degree, short/long-term certificate) there is significant variation in earnings and likelihood of employment resulting from the different fields of study.

The entire report can be found here.

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Summary of the Recommendations of the Compensation Technical Working Group

Passed in 2009, ESHB 2261 created the Compensation Technical Working Group (CTWG), which was charged with developing a new salary allocation model (SAM) that is simpler, more competitive with other professions, and aligned with educator development and certification. The new compensation system must better attract and retain world-class educators and help build a world-class education system. The CTWG is comprised of representatives from stakeholder groups, including school administrators, principals, teachers, school employees, school districts, school boards, and compensation experts. After 12 months of meetings, the group released its recommendations on June 30, 2012.

To determine an appropriate wage for K-12 employees a comparable wage analysis was conducted for each staff position using Washington State Employment Security Department data on the wages of occupations in Washington State with similar knowledge, skill, education, and training requirements.  The proposed SAM would increase beginning teachers’ salaries from $33,401 to $48, 687. The beginning salary for comparable occupations to teachers was determined to be $58,424, that figure was then adjusted downward, multiplied by 83.3 percent, to account for teacher contract days spanning ten out of twelve months during the year to arrive at starting teacher salary of $48,687. A similar wage analysis was conducted for principals, which determined that the comparable wage for principals is $105,374. Currently the state has an average principal allocation of $58,175, though because districts use local funds to supplement principal salaries, the average principal earns $101,860 annually.  Further, all K-12 staff are moved to a competitive salary using a comparable wage analysis.

The proposed SAM would be a way to allocate money to districts and then the districts would be able to determine their own salary structure as long as they met the minimum starting salary requirement of $48,687 for teachers. There is an annual adjustment for cost of living increases; there is no regional cost adjustment.

The new model would also limit the use of local funds for salary enhancements of state-funded basic education staff to 10 percent above the state allocation to districts for basic education staff.  Ex., a district receives a $100 million state allocation to pay for basic education salaries. The district would be able to spend up to $10 million above the state allocation, in local funds, to pay bonuses or supplement salaries.

The new model is projected to annually cost $2 billion more than current allocations.

The complete report by the Compensation Technical Working Group can be found here. A detailed teacher salary allocation model is located on page 32 of the report.

 

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