David Deming
HARVARD KENNEDY SCHOOL HARVARD GRADUATE SCHOOL OF EDUCATION. Professor of Public Policy, Education and Economics. Research focuses broadly on the economics of skill development, education and the labor market.
Can Investing in Public Colleges Serve as an Infrastructure Project?
Education Policy

Can Investing in Public Colleges Serve as an Infrastructure Project?

The Issue:

President Trump and members of both political parties have called for increased investment in U.S. infrastructure as a way to strengthen the U.S. economy. Investments in public colleges – our educational infrastructure – provide a high rate of return on investment in “human capital”. Yet decades of declining taxpayer support have allowed them to fall into disrepair, just like our buildings, bridges and roads.

The Facts:

  • The increase in lifetime earnings from obtaining a college degree makes it one of the best investments a young person can make. One study estimates that lifetime return to a college degree for men grew from $200,000 in 1965 to nearly $600,000 in 2010.
  • Public colleges play a particularly important role in helping students from low income families move to higher-income brackets. The City University of New York (CUNY) system alone sends six times more low-income students per year to the top 20 percent of the income distribution than the entire Ivy League combined, according to a recent study.
  • The workers hit hardest by globalization, trade and automation are those without a college education.
  • In spite of the high returns to college, total state spending on higher education declined by 37 percent between 2000 and 2012, and has recovered only slightly in recent years.
  • Research shows that spending cuts in community colleges and local, open access four-year institutions decrease student enrollment and lower the number of degrees completed. Since 1990, 29 states have cut their higher education budget by 15 percent or more in a single year. The figure above shows that state budget cuts lead to slower college enrollment growth in those states for up to 5 years afterward.