Academic Program Supply and Occupational Demand ...

Academic Program Supply and Occupational Demand Projections: 2008?2018

LeAnn Luna Associate Professor Center for Business and Economic Research

Matthew N. Murray Associate Director Center for Business and Economic Research

Vickie C. Cunningham Research Associate Center for Business and Economic Research

Prepared by the Center for Business and Economic Research College of Business Administration The University of Tennessee Knoxville, Tennessee

April 2011

Center for Business and Economic Research

716 Stokely Management Center Knoxville, Tennessee 37996 Phone: (865) 974-5441 Fax: (865) 974-3100

404 James Robertson Parkway Suite 1900 Nashville, TN 37243 Phone: (615) 741-3605

Acknowledgements

ACKNOWLEDGEMENTS

The authors gratefully acknowledge the contributions of the following individuals in the conceptualization, design, and dissemination of this report. Tennessee Department of Labor and Workforce Development Martha Wettemann Tennessee Higher Education Commission Chris Brewer Linda Doran James Hawkins Betty Dandridge Johnson Mike Krause Indrani Ojha David Wright Takeshi Yanagiura Tennessee Business Roundtable Gordon Fee Ellen Thornton

Academic Program Supply and Occupational Demand Projections: 2008?2018 [UT Center for Business and Economic Research] i

Table of Contents

CONTENTS

Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Supply of Academic Awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Table 1: Types of Awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Table 2: Institutions Included in Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Occupational Demand Projections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Table 3: Types of Education Experience Requirements . . . . . . . . . . . . . . . . . . . . 8 Analyzing Supply and Demand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Table 4: Career Clusters and Cluster Definitions . . . . . . . . . . . . . . . . . . . . . . . . 11 Table 5: Career Paths and Their Presence in Tennessee . . . . . . . . . . . . . . . . . . 12

Supply Projections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Regional Awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Aggregate Awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Table 6: Summary of 2008 Awards by Labor and Workforce Investment Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Figure 1: Summary of 2008 Awards by Labor Workforce Investment Area 15 Figure 2: Certificate Awards by Academic Year . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Figure 3: Degree Awards by Academic Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Figure 4: Post-BA, Post-MA, and First-Professional Awards by Academic Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Instructional Programs and Awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Table 7: Instructional Program Forecast, Instructional Programs Summary, Awards by Academic Year . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Table 8: Top 10 Growing Instructional Programs . . . . . . . . . . . . . . . . . . . . . . . . 20 Table 9: Top 10 Slowest Growing or Declining Instructional Programs . . . . 21 Table 10: Top Science, Technology, Engineering and Mathematics Instructional Programs by Number of Awards . . . . . . . . . . . . . . . . 23 Table 11: Number of Programs Forecasted to Produce Zero Graduates in 2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

Supply and Demand Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Table 12: Top 10 Under-Supplied Paths . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Table 13: Top 10 Over-Supplied Paths . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

ii Academic Program Supply and Occupational Demand Projections: 2008?2018 [UT Center for Business and Economic Research]

Table of Contents

CONTENTS

Appendices APPENDIX 1: Number of Awards of Public and Private Institutions by Local Workforce Investment Area, 2008 APPENDIX 2: Projected Awards by Individual Instructional Program, Including . Certificates from Institutions that offer Associates or More Advanced Awards APPENDIX 3: Share of 2008 Awards Granted by Public versus Private Institutions APPENDIX 4: Award Categories Projected to Produce No Graduates in 2018 APPENDIX 5: Share of 2008 Award Recipients Working in Tennessee Three Quarters After Graduation APPENDIX 6: Career Pathways--Supply and Demand Projections APPENDIX 7: High-Need Field Crosswalk

Academic Program Supply and Occupational Demand Projections: 2008?2018 [UT Center for Business and Economic Research] iii

Executive Summary

EXECUTIVE SUMMARY

The research presented in this report is a cooperative effort between the Tennessee Higher Education Commission and the University of Tennessee's Center for Business and Economic Research. Using historical data from 2000-2008 as a guide, we project academic awards for various instructional programs and disciplines for Tennessee's public, private for-profit and private non-profit post-secondary institutions through 2018. We link the academic award projections on the supply side of the labor market to anticipated job openings by occupation on the demand side of the labor market. The results provide insight into how well the output of Tennessee's educational institutions matches the anticipated demands of the state's employers. This information can be used by policymakers at all levels in Tennessee, from the legislative and executive branches down to the level of an academic award producing unit, as well as by business and city planners, guidance counselors and employers.

The instructional programs showing the largest projected increase in number of awards are in fields related to healthcare, business, education, and liberal arts. Our projections reflect the growing importance of the healthcare profession in our education system and economy, as seven of the top fifteen and fourteen of the top fifty fastest growing programs are in the healthcare profession. We also examine the top STEM (science, technology, engineering, and mathematics) programs and find that the number of graduates in eight of the top ten fastest growing STEM fields is expected to more than double by 2018; these fields are growing from a small base while demand is growing rapidly. Programs that are contracting the fastest include general business, management /computer information systems, administrative assistant and secretarial science, and journalism. Approximately 360 instructional programs at various award levels are projected to produce zero awards by 2018. In some cases, these programs are ending, but in many cases, programs are being reorganized.

Educational output is especially meaningful to the extent it meets the needs of private and

public sector employers in Tennessee. Because many occupations do not require a highly specific educational award, we aggregate the data into functional groups?career pathways?and perform one-to-one matching of groups of academic programs with groups of occupations. The analysis of supply and demand within the pathways allows identification of gaps between projected educational awards and projected job openings. The largest under-supplied career pathways include programming and software development, marketing, human resources, business financial management and accounting, environmental service systems, and construction. The largest over-supplied career pathways include teaching, therapeutic services, science and mathematics, management, administrative and information support, and journalism. The estimated surplus of awards for teaching and therapeutic services is an artifact of the breadth of the career pathways and serves as a caution in interpreting and applying the data to policy. As noted in the report, more refined analyses of the markets for public elementary and secondary teachers and licensed practical nurses and registered nurses show significant shortfalls between projected award production and occupational demand.

Linking academic programs with specific occupations is very difficult for several reasons. First, the linkage between minimum educational requirements and specific occupations will likely be quite accurate for highly specialized awards, especially at the Associate's level and for many advanced degrees. However, many Bachelors' degree fields are more problematic because individuals have the opportunity to work across a range of occupations. Using aggregated career pathways to match sets of academic programs to a range of potential occupations is necessary but can mask underlying surpluses or deficits for specific award-occupation combinations.

Second, business and industry composition vary markedly across the state, and the production of post-secondary awards also varies across the state. Thus, demand for an occupation may be high relative to supply in one community while low

Academic Program Supply and Occupational Demand Projections: 2008?2018 [UT Center for Business and Economic Research] 1

Executive Summary

relative to supply in another community. Further, Tennessee does not obtain labor solely from within the state, and individuals with higher levels of educational attainment, especially Master's degrees and PhDs, are more likely to migrate in pursuit of employment opportunities elsewhere. Finally, our projections are based on historical data from 20002008; therefore, it is difficult to accurately project awards for newly-emerging fields and impossible

to project awards for fields that have yet to be put in place.

Even with these limitations, the present study provides important information and serves notice that demand data will play an increasingly large role in academic program approval and termination, development of performance funding incentives for institutions, and student advising.

2 Academic Program Supply and Occupational Demand Projections: 2008?2018 [UT Center for Business and Economic Research]

Introduction

INTRODUCTION

Tennessee had a momentous year in 2010 with the receipt of a large federal Race to the Top grant and passage of several important education-related legislative initiatives. Especially notable was the Complete College Tennessee Act of 2010 which was signed into law by Governor Bredesen in January. While the state's public higher education institutions have historically been funded based largely on enrollment, the new outcomes-based funding formula will place greater emphasis on retention and graduation. The initiatives that Tennessee is embarking on offer the potential to fundamentally transform the state's educational pipeline to the betterment of state residents and the state economy.

Outcomes-based funding will place greater pressures on the institutional planning process. Resources will need to be carefully allocated to support growing instructional programs, especially those that reflect the strategic interests of the state and those that have strong employer demand. These decisions will have to be made in an extraordinarily difficult budget environment, and at least in the near term, in the face of weak state and national labor markets.

The research presented in this report is a cooperative effort between the Tennessee Higher Education Commission (THEC) and the University of Tennessee's Center for Business and Economic Research (CBER) and is intended to support the institutional planning process in Tennessee. The report includes projections of awards by instructional program extending out to 2018. Identified are awards and instructional programs that are expected to grow as well as those expected to contract based on historical trends between 2000 and 2008. These projections can be utilized by education policymakers at virtually all levels in Tennessee, from the legislative and executive branches down to the level of an academic award-producing unit.

Also presented in the report are projections of occupational demand between 2008 and 2018, as reflected by anticipated annual position openings by occupation. These estimates, developed by the Tennessee Department of Labor and Workforce

Development, are linked to the projections of academic awards by career programs of study and are discussed more fully below. The occupational demand and academic award supply projections together can support the analysis of potential supply and demand imbalances anticipated in the years ahead. However, the projection process is complex, as is the changing environment within which Tennessee's institutions of higher education operate. As such, the projections presented here cannot be used in isolation but must take into account other information and trends that are occurring on both the supply and demand sides of the market.

The following section of the report discusses the methodology used to develop the supply and demand projections and important caveats that need to be considered when using the estimates. Subsequent sections present key findings, beginning with an overview of broad trends in projected awards and closing with an analysis of potential supply and demand imbalances. Appendices of the report provide documentation and a series of detailed tables that are intended to support the academic planning process. Appendix 1 shows 2008 award production for Local Workforce Investment Area (LWIA) regions of the state. Detailed projections of awards by individual program of instruction appear in Appendix 2. Appendix 3 presents the public and private shares of award production for 2008. These data can help shed light on the projections because all of forecasts of award supply are aggregated across public and private institutions of higher education. A significant number of award categories for specific instructional programs are projected to produce no graduates in 2018, and these are reported in Appendix 4. Appendix 5 shows the share of graduates from Tennessee institutions of higher education that are working in the state three quarters after the receipt of a degree. These data can be used for a number of purposes, including the analysis of possible in-state imbalances between the supply of awards and the demand for workers across occupational categories. Data for Appendix 5 were drawn from the series of

Academic Program Supply and Occupational Demand Projections: 2008?2018 [UT Center for Business and Economic Research] 3

Introduction

studies "School-to-Work: Do Tennessee's Higher Education Graduates Work in Tennessee?" (). Appendix 6 reports data on each of the career paths--the individual instructional programs contributing to

supply and the individual occupations constituting the demand side of the market. Finally, Appendix 7 presents information for High-Need Fields in support of the 2010?15 Performance Funding Cycle.

4 Academic Program Supply and Occupational Demand Projections: 2008?2018 [UT Center for Business and Economic Research]

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