Report Shows the Economic Benefit of Community Colleges

Report Shows the Economic Benefit of Community Colleges
  • Opening Intro -

    America's community colleges are two-year public schools and are often not fully appreciated for what they do. Community colleges prepare Americans for work, by offering certificate programs and associate degrees that can lead to a whole range of jobs.

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These institutions are also steppingstones to four-year schools, with many students transferring in a bid to seek a bachelor’s degree.

AACC Report

Community colleges also contribute to the economy, contributing $809 billion in 2012 according to a report released this week by the American Association of Community Colleges (AACC). That report — Where Value Meets Values: The Economic Impact of Community Colleges — demonstrates just how important these schools are to the US economy.

The $809 billion generated by community colleges in 2012 represents 5.4 percent of the gross domestic product (GDP). But it doesn’t stop there — greater economic benefits to the tune of $285.7 billion will be realized in increased tax revenue as community college students earn higher wages. Another $19.2 billion is saved as the traditional safety nets including welfare no longer need to support empowered graduates.

The AACC also found that for every dollar a community college spends on his or her education, a return of $3.80 is realized.

Of the $809 billion total effect of community colleges, international student spending comes in at $2.6 billion. A small number for certain, but part of a greater number that supports 15.5 million job equivalents in 2012.

Student Investment

Community college students have also invested in their education beyond setting aside earning opportunities to attend college. They paid tuition, fees, books, supplies, and paid interest on student loans. Broken down, that investment comes to $18.7 billion in personal expenses and $78.7 billion in time forgone and money, for a $97.5 billion investment.

The AACC also found that community college students earned about $10,000 per year more than high school graduates. Thus, a high school graduate could expect to earn $31,200 per year on average while a community college student with an associate degree could expect to earn $41,900 per year on average. That amount rises to $58,100 per year for a bachelor’s degree and $73,600 per year for a master’s degree.

Taxpayer Return

Taxpayers, of course, also invest in community colleges and most certainly want a return on their investment. The AACC found that the total benefits to taxpayers equalled $304.9 billion, what equaled the sum of added taxes and public sector savings. For every $1 in tax money set aside for community colleges, the return was $6.80. As an investment it would provide a yield of 14.3 percent, roughly paralleling what other long-term investments pay in both the public and private sectors.

Certainly, community colleges have a large impact on society. And now you know the rest of the story.

See AlsoCommunity College Enrollment Made Easy

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Categories: Campus News