A population explosion among Californians of college-going age (18-24)in the next decade will push this age group to a projected 4.26 million in 2015, an increase of 27% since 2000. California is in prime position to invest now in higher education to secure the State’s economic future. If we fail to invest, the state is likely to face a host of social and economic difficulties associated with a population boom of young people ill-prepared for the demands of the 21st century economy. This report quantifies the potential benefits of state investment in higher education, and the cost of failing to invest. We find that the gains are substantial: For every new dollar California invests to get more students in and through college above current levels, it will receive a net return on investment of three dollars. Put another way, the possible gains in college-going analyzed in this study for each annual cohort of young adults entering their college-going years could provide more than 3 billion dollars to the state in additional net tax revenues over their lifetime.
In today’s 21st century economy, California’s high-tech and service economies demand more educated workers while opportunities for less-educated workers are likely to grow dimmer. As the recent “California 2025” report by the Public Policy Institute of California found, over the next two decades, California businesses will require a much
larger proportion of their workforce to have training beyond high school, including community college and university-level degrees. Education pays off for the state, too. Highly educated, high-income workers pay more taxes on those higher incomes and demand fewer state services than less educated, low-income workers do. To regain the economic leadership California o ...