The Impacts of Initial Enrollment at Two-Year Colleges on Student Academic and Labor Market Outcomes
*Names in bold indicate Presenter
While a large body of research has explored the transfer function of community colleges, the majority of the existing studies focus on the educational outcomes of community college students, particularly four-year degree completion. In contrast, there is little evidence on its impacts on student labor market outcomes. Yet, even for those who could enroll in a four-year college immediately following high school, students are increasingly looking to community colleges as a monetarily efficient first step towards eventual BA attainment. Therefore, understanding the impacts and the cost-effectiveness of initiating in two-year colleges is critical for various stakeholders.
Using a large administrative data matched with the National Student Clearinghouse (NSC), and Unemployment Insurance (UI) records, this paper intends to provide a better understanding of the transfer function of community colleges by examining not just students’ academic outcomes but also their labor market outcomes, comparing outcomes between Bachelor-aspiring students who initiated in a community college versus similar students who started in a four-year college. We focused on 55,728 Bachelor-aspiring students who initially enrolled in one of the two-year or four-year public or private institution in the fall of 2004 and tracked these students for eight years. We used multiple strategies including a traditional Mincerian model, and propensity score matching to control for baseline differences between students. We used multiple strategies including a traditional Mincerian model, and propensity score matching to control for baseline differences between students.
Results indicate that starting in a community college over a four-year university decreases the probability of completing a bachelor’s degree by 35%. This number is reduced to 15% when restricting to non-selective four-year institutions, though the coefficient is still significant. Such negative impact is largely driven by the low transfer rate, where only 23% of community college students with the demonstrated intention to get 4-year degrees transferred within 8 year since initial enrollment. In terms of labor market outcomes, students who started in two-year colleges had lower average quarterly earnings in 2012 by $1,557 compared to those who initiated at a four-year college. However, this difference is sharply reduced and no longer significant when compared to students who started in non-selective four-year institutions only.