Association for Public Policy Analysis & Management

It is well-established that enrollment in postsecondary education follows a countercyclical pattern. Moreover, there is increasing recognition of the prevalence of non-traditional students in sub-baccalaureate postsecondary institutions, many of whom likely return to schooling following job loss.

In this paper we explicitly measure the response of enrollment in sub-baccalaureate degree and certificate programs to downturns in the local labor market. We also examine whether changes in the types of programs students enter reflect shifts in local occupational opportunities. We pay close attention to heterogenous effects by education sector, as there is growing evidence that two-year public institutions behave differently than for-profit institutions. We use the extent of large layoff events as our measure of local downturns and observe educational patterns in the Integrated Postsecondary Education Data System (IPEDS). Layoff events are a good representation of permanent labor demand shocks, as they are not subject to many concerns about endogeneity to changes in labor supply or migration patterns.

We find evidence that enrollment across all postsecondary sectors increases following labor downturns. Enrollment responses are particularly large for short-term certificate programs as opposed to longer degree programs. Effects are larger for middle-aged workers, as they are the ones most acutely affected by mass layoff events. Our results also suggest that the largest responses following adverse economic conditions are in vocational programs, especially in information technology and allied health.

Our research has strong implications for policymakers and college administrators seeking to make sub-baccalaureate education more effective. One implication is the increasing importance of tailoring academic offerings to the demands of local labor markets. Another implication is that policymakers and administrators must be attuned to local layoff events in order to recognize and respond to the needs of students entering academic programs following job loss.