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California is Still Golden for College Graduates

Hans Johnson June 20, 2017

Over the past 15 years, 1.5 million more people have left California than have moved here from other states, according to estimates from the California Department of Finance. Remarkably, even in the face of this outflow, California still experiences net gains of college graduates (those with at least a bachelor’s degree). Over the past five years, California ranks second among all states in net gains of college graduates from other states, even as it ranks first in net losses of less educated adults.

From a demographic perspective, these patterns are unprecedented. In contrast to California, other states that gain large numbers of college graduates, such as Texas and Florida, also gain large numbers of less-educated residents. And states that lose large numbers of less-educated residents, such as New York and Illinois, also lose large numbers of college graduates. California is unique in gaining large numbers of college graduates while losing large numbers of less educated adults.

Why does California have such disparate migration patterns? People move across state lines for many reasons, but primary among them are jobs, housing, and family. California’s strong labor market for highly educated workers attracts college graduates from other states, while the state’s high cost of housing is especially hard on workers with less education and lower incomes.

California will face a large skills gap by 2030—it will be 1.1 million college educated workers short of economic demand if current trends in the demand for skilled workers and the educational attainment of the state’s population continue. Can migration fill this gap? No, but it can help. However, in 2015–16 the University of California awarded more than 50,000 bachelor’s degrees, the California State University awarded more than 90,000, and private non-profit colleges in California awarded almost 40,000—much more than the average annual migration gain of about 20,000 college graduates.

The best way to close the skills gap is to prepare more Californians for the economy of the future. The state can increase the number of home-grown college graduates by focusing on college readiness in K–12 schools, improving completion and transfer rates at all the state’s higher education institutions, and expanding access to four-year colleges. By taking action now, the state can realize big benefits in the future: higher incomes, more tax revenue, less demand for social services, and greater economic mobility.

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