Association for Public Policy Analysis & Management

There has been growing political pressure for states to offer free community college education. Community colleges are convenient post-secondary institutions that offer multiple educational options. Previous research indicates that workers with community college credentials get paid better than workers with high school degrees and not as good as workers with bachelor’s degree. Theorist have suggested that there is a mid-level labor market for people who have sub-baccalaureate degrees. There is, however, very little research on whether the mid-level employment opportunities are specifically tied to community college credentials. This research compares the wage and job status outcomes of community college degree earners with people who studied in higher education but did not receive a credential. For this study, I used the 2002 Educational Longitudinal Study, which tracks 10^th graders in 2002 through their education and employment in 2012. Using Weighted Least Squares regression with entity fixed effects to control for occupational categories, I examined the salary and job status returns for all study respondents who enrolled in higher education, some who earned degrees and others who did not. I also controlled for respondent’s background (including his or her zip-code community), academic performance, higher education institution, and present employment situation. In contrast to bachelor’s degree earners who received large wage and status benefits in their occupations, I found that there is no wage benefit and only a small status benefit for people who earned an associate’s degree. For certificate earners, there is a small wage and small status benefit. The difference in the wage benefits between associate degree earners and certificate earners can be attributed to fields of study. Many certificate programs are for in-demand vocational occupations such as health-related occupations and technicians. In contrast, a majority of associate degree recipients only studied general studies, and many of the associate degree earners were still studying eight years after high school. In conclusion, it is important to reconsider the present political push to open community colleges to everyone for two free years. Policy makers should target educational assistance to where it can be the most beneficial. Two potential opportunities for community college educational development are through expanding education for local market-centered employment opportunities and providing more extensive funding for disadvantaged community college students who graduate from community college and want to continue to study at more expensive bachelor’s degree-granting institutions.