America's Fastest-Dying Cities: Implications for Higher Education

College Search & Selection
81

<p>^ Excellent post, BedHead.</p>

<p>I'd also note that some of the indicators Forbes uses are pretty contradictory. So, for example, low taxes and cheap labor are a positive in their index, but so is a highly educated workforce. But notice that very few states manage both; the lowest "business cost" states (cheap labor, low taxes) generally rank pretty far down in "labor rank." Generally you can't have a well educated workforce without schools, and that requires taxes; and on the other side of the coin, an educated workforce will command higher pay, raising business costs. Lumping these figures together in a single index makes a hash of it. As you indicate ^, some businesses are looking for low wages, low taxes, and low costs in general, but these days such firms are more likely to locate offshore. Other businesses are looking for the appropriate skills and education which generally won't be found in the cheap-labor, low-tax states. And for that matter, the specialized skills that many high-tech businesses are looking for won't necessarily be reflected in the average educational attainment of the entire workforce, either. (California, for example, ranks a middling 17th in "labor rank," notwithstanding Silicon Valley).</p>

<p>Consider:</p>

<p>LOW COST/POOR LABOR RANK (LOW EDUCATIONAL ATTAINMENT) (ranked 1-10 by lowest business cost)
South Dakota 1, 31
Wyoming 2, 35
Tennessee 3, 39
Indiana 4, 46
North Dakota 5, 37
North Carolina 6, 22
Delaware 7, 14
Iowa 8, 43
Arkansas 9, 40
New Mexico 10, 34</p>

<p>HIGH COST/HIGH LABOR RANK (HIGH EDUCATIONAL ATTAINMENT) (ranked 1-10 by labor rank)
New Hampshire 39, 1
Colorado 35, 2
Maryland 41, 3
Washington 33, 4
Virginia 17, 5
Arizona 30, 6
Oregon 26, 7
Connecticut 44, 8
New Jersey 46, 9
Idaho 11, 10</p>

82

<p>Bad trends likely to continue, particularly with the recent financial market problems. </p>

<p>The</a> Chronicle of Higher Education</p>

83

<p>This is the problem: Midwest (Big Ten Schools) have very good to excellent universities that provide great educational and financial value for local and out-of-state students. As someone stated earlier, the jobs (with the exception of Chicago) are few to non-existent because these states traditionally relied on heavily unionized municipal and manufacturing-based economies (steel, auto, furniture, farming, trades, etc.) which did not require a college degree. You worked for the same employer for 30-40 years and drew out a pension during your retirement. Graduates are forced to relocate elsewhere with strong service-based economies to get a job.</p>

84

<p>What we here at University of Michigan really enjoy are the subtle insinuations from legislators that it's our fault that students take jobs elsewhere.</p>

85

<p>Gov Granholm (Michigan) is doing her best to bring jobs here. Unfortunately, if your major is not engineering or health care, you almost have no choice but to leave the state.</p>

86

<p>^ How popular is Granholm in Michigan?</p>

<p>To attract businesses and jobs you need to lower the cost to do business.</p>

87

<p>Positive news here in Toledo today. The Univ. of Toledo announced it would give free tuition to public school students in Ohio's largest cities if they have a GPA of 3.0 or higher. I'm going to start another thread with a link to the article. I'm not sure how they can offer this.</p>

88

<p>Granholm's popularity is very mixed. She practically inherited a declining economy in her first election so I cannot blame the entire state suffering on her. I give her effort for traveling overseas to attract and persuade foreign businesses to invest in the state with generous tax breaks. I just wish she could attract a higher variety of companies, including those with a more social/policy mission. It doesn't help that the state's largest region (Metro Detroit) continues to decline too.</p>

<p>Keep in mind that only a quarter of the state's residents have a college degree. Yet, Michigan has some of the most well-known (and prestigious) universities in the country. I think it's a crying shame, but it was possible to live the middle class dream with just a high school degree and factory job. Michigan has become a "brain drain/feeder state" when it comes to educating students in higher education.</p>

<p>
[quote]
In leading states, the commission found that 40 percent of adults have an associate's degree or higher and 33 percent have a bachelor's degree or higher. In Michigan, those percentages are 29 and 22 percent, respectively. Eight percent of the state's adults have a master's degree or higher, compared to the national average of 14 percent.</p>

<p>Commission:</a> Education key to Michigan's economic success

[/quote]
</p>

89

<p>Just squeeze a few more bodies into the classes. Instead of 200 in lecture you have 225. Is it really all that different for most kids-probably not. Many upper level classes have room too except in some highly desired majors.</p>

<p>As to the state economies--just as many western and southeastern states appear in trouble as midwest states. In the West and SE growth alone was a major part of the economy--new homes, selling homes, lending etc. Now all that has vanished. My NoCal RE contacts say the area is still in recovery from the last Dotcom bust. Vacant office and tech space abounds.</p>

<p>Going to be interesting times. And not in a good way.</p>

<p>The UW gets some of the same crap about kids moving away to work. Milwaukee or Chicago--let me think....CHICAGO. More kids are staying around Madison than moving to Milwaukee now.</p>

90

<p>Ann Arbor is the healthiest economy in Michigan right now. The college towns with major universities will continue to have stable economic growth to endure these troubled times. Some people will choose to go back to graduate school to avoid the job market altogether.</p>

91

<p>Michigan</a> Sweats GM-Chrysler Talks - WSJ.com</p>

92

<p>State FY2009 budget deficits, ranked by shortfall as % of state budget general fund:</p>

<p>rank/ % shortfall/ state/ total shortfall</p>

<ol>
<li>21.3% California $22.2 billion</li>
<li>17.8% Arizona $1.9 billion</li>
<li>13.5% Nevada $898 million</li>
<li>12.6% Rhode Island $430 million</li>
<li>11.0% Florida $3.4 billion</li>
<li>10.6% New Jersey $3.5 billion</li>
<li>9.2% Alabama $784 million</li>
<li>9.1% New York $4.9 billion</li>
<li>6.9% Virginia $1.2 billion</li>
<li>6.6% Illinois $1.8 billion</li>
<li>6.4% Delaware $217 million</li>
<li>6.4% New Hampshire $200 million</li>
<li>6.0% Iowa $350 million</li>
<li>5.5% Maryland $808 million</li>
<li>5.5% Minnesota $935 million</li>
<li>5.2% Tennessee $585 million</li>
<li>5.1% Vermont $59 million</li>
<li>4.9% Michigan $472 million</li>
<li>4.8% Wisconsin $652 million</li>
<li>4.7% Ohio $1.3 billion</li>
</ol>

<p>Source: Center on Budget and Policy Priorities</p>

<p>hawkette, I know you can hardly contain the schadenfreude reflected in your numerous posts on Michigan's economic demise and what that will "inevitably" mean for educational quality at the University of Michigan, but I think we need to keep some perspective here. The figures above reflect the fiscal plight of states immediately before the recent financial meltdown. For most of these states, it's going to get a lot worse before it gets better. But Michigan enters the current financial and economic mess in much stronger shape than a whole bunch of states in the Southwest, Southeast, and Northeast, where the bottom had already fallen out of economies driven primarily by a housing bubble that never really infected the industrial Midwest. I don't mean to minimize Michigan's (or Ohio's, or Wisconsin's) economic pain, but thisrecession is going to be deep and widespread, and the budget axe is going to fall most heavily in states like California, Florida, Arizona and Nevada that came into the current crisis already facing double-digit budget shortfalls. Also keep in mind that those most at risk are the public colleges and universities that are most heavily dependent on legislative appropriations as a fraction of their overall budgets. The University of Michigan is one of the least dependent on legislative appropriations---approximately 7% of its total budget, according to figures I've seen, while many state universities get 20-30% or more of their budgets from the legislature. A 20% cut from 7% is 1.4% of your total budget---painful, but mainly calling for a little belt-tightening. A 20% cut from 30% of your budget is 6% of your total spending. That's a meat-axe.</p>

93

<p>Cavalier</a> Daily</p>

94

<p>bclintonk,
Re your earlier comments about the state of Michigan, my impression is that the situation is more dire than you imply. I also believe that there is a trickle down effect to all of higher education in the state of Michigan, including U Michigan. While U Michigan certainly has considerable resources and will find ways to persist in financial terms as a relatively strong university, the state's prospects are undeniably weaker. This has implications for the ability of the higher education system in that state to attract and retain top students and top faculty. </p>

<p>It is my understanding that Michigan's budget stabilization fund is now practically empty and the state must resort to spending cuts and/or tax increases in order to make their budget. My understanding is that there have been recent moves to increase personal tax rates and general sales tax rates, both of which are unlikely to spur much economic growth in that state. The state did a round of budget cuts in the spring and more seem likely. Spending on education did grow by 2% but that is below the rate of inflation and, due to still large budget deficits and the poor outlook for Michigan's economy, is unlikely even to maintain that pace.</p>

<p>Michigan's manufacturing employment is still around 14% and that is before the latest GM-Ford-Chrysler troubles. More payroll cuts appear inevitable and Michigan's housing foreclosure rate is one of the highest in the country with no signs of relief in sight. Unemployment is about 9% which is the highest in the entire USA.</p>

<p>So, I hope you can understand why some perceive trouble ahead for institutions that might rely on the state of Michigan (and other industrial states in the Midwest) for some of their funding. Some colleges are unquestionably better placed to withstand these financial pressures, but the problems will impose some costs on the system, including some psychological damage as more and more seek out better opportunities in other parts of the country.</p>

95

<p>"I'd also note that some of the indicators Forbes uses are pretty contradictory. So, for example, low taxes and cheap labor are a positive in their index, but so is a highly educated workforce. But notice that very few states manage both; the lowest "business cost" states (cheap labor, low taxes) generally rank pretty far down in "labor rank." Generally you can't have a well educated workforce without schools, and that requires taxes; and on the"</p>

<p>Demographic trends have to be factored in too. New Hampshire is losing adults in the 20-30 age range as many find that they can't afford to live here as wages aren't high enough. So an educated work force of older employees remains but something has to break sooner or later. The NH draw of no income or sales taxes isn't enough to get companies back up here.</p>

96

<p>The UM President does not seem overly worried. Lots go good things going on.</p>

<p>2008</a> Senate Assembly Address - Oct. 27, 2008</p>

97

<p>Would you expect him to say anything differently? I mean, he still wants to hire faculty, he still wants to attract and retain students. Conceding problems could only hasten the stampede out of the state of Michigan. </p>

<p>It's not the same situation, but such comments remind me of those of the head of Bear Stearns claiming that they were in fine shape just days before insolvency pushed them into the arms of JP Morgan.</p>

98

<p>Same deal at IndyMac. A customer came in worried about his big deposits over FDIC insurance limits. The Bank Officer assured him that his deposits were safe. And they were taken over a few days later and he was out most of his dough. Those in office have to talk their book.</p>

99

<p>Him? Mary Sue Coleman is most assuredly female. If you missed this as you closely analysed U-M's prospects and finances, you can at least find this out by looking at the photo in the upper right of that website more closely.</p>

100

<p>^ That would be "she." Mary Sue Coleman has been President of the University of Michigan since 2002. </p>

<p>You can dismiss President Coleman's optimism if you like, hawkette, but it suggests Michigan is in a far stronger financial position than many of its public competitors. Compare the following clear-eyed and rather pessimistic assessment by University of California President Mark Yudoff, who warns of difficult belt-tightening and the daunting challenge of remaining competitive in an era of flat state funding coupled with rising costs: </p>

<p>University</a> of California - UC Newsroom | Governor signs 2008-09 state budget; funding stays flat for UC system</p>

<p>The difference? The University of California system is far more dependent on legislative appropriations than is the University of Michigan, which has been forced gradually to wean itself away from dependence on state funding over the course of more than three decades of secular decline in the fortunes of the U.S. auto industry. I don't mean to minimize the severity of the State of Michigan's current fiscal crisis. My only point is that many, many states have it just as bad if not worse, and those whose state university systems are more dependent on state financing than is the University of Michigan are going to be hit harder by the current recession.</p>