Researchers at the Iowa Policy Project argue the state would be better off offering direct subsides to low-income workers so they can get a college degree rather than giving worker training incentives to businesses that promise to hire more employees.
Iowa Policy Project researcher Lily French says the Iowa workforce data clearly shows the benefits of a college education “For example, those with a bachelor’s degree earn on average $7.26 more an hour than those with only a high school diploma,” French says.
The wage gap is startling, according to French. “Over the past three decades the wages of workers with a college degree increased by 17 percent, while the wages of workers with less than a high school diploma has actually declined by 27 percent,” she says.
“So, as a result, families headed by a parent with a college education are also much less likely to live in poverty even in hard economic times like we’re facing today because they spend less time without work after a job loss and are more likely to be reemployed at comparable wages and at jobs that offer health insurance.”
Iowa Policy Project research director Peter Fisher says a state scholarship program for low-income adults would result in higher lifetime wages for those workers — and the state would benefit, too.
“If you actually invested in a low income worker and gave them a tuition-free, cost-free, two-year community college degree they’re going to earn more over their working life, they’re going to pay more state taxes over their working life and we will get much more than our money back over the next 40 years as they pay more in taxes,” he says.
According to Fisher, every dollar the state would invest in such scholarships would reap more than two-dollars in return for the state. Fisher says it would also help address the looming worker shortage the state faces.
