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Press Release · September 29, 2000

Education and the California Labor Market

Education is everything in California’s high-velocity labor market, but a number of trends raise questions about the state’s ability to sustain the boom. PPIC senior fellow and economist Julian Betts examines these issues in a just-released study, The Changing Role of Education in the California Labor Market.

Key findings:

  • From 1970 to 1990, California universities produced just over half the bachelor’s and higher degrees needed by the state’s labor market. As a result, the state imported much of its highly skilled workforce from other states and nations. This fact raises some important policy considerations, including maintaining the state’s desirability as a place to live and work and expanding financial support for postsecondary education.

  • The study challenges the persistent claim that K-12 schools are solely to blame for the growing percentage of Californians who lack a high school degree. Although a majority of state residents who have less than a 12th grade education are immigrants, it appears that 74 percent of these immigrants ended their formal schooling before coming to the United States. The study recommends that policymakers focus greater resources on adult education programs such as job training and programs at community colleges.

  • The gap in earnings between those with more education and those with less has grown tremendously in California. In 1969, workers with more than a bachelor’s degree earned 24 percent more than high school graduates with otherwise similar backgrounds; by 1996, this difference had skyrocketed to 95 percent more. During this same period, workers with less than a 12th grade education saw their real earnings decline from about $31,000 to $17,000 (1996 dollars).

Please contact Victoria Pike Bond at 415/291-4412 or Abby Cook at 415/291-4436 for further information or assistance.

The Public Policy Institute of California is a private, nonprofit organization dedicated to objective, nonpartisan research on economic, social, and political issues that affect the lives of Californians. The Institute was established in 1994 with an endowment from William R. Hewlett.