What is the best thing that can be done to make Minnesota competitive in our global economy? Invest now in order to build the most well-educated and talented workforce in the world.
You don’t need to take our word for it. Listen to Michael Langley, CEO of Greater MSP, a business-led group focused on attracting new employers to the Twin Cities: “The most important factor for businesses in making a decision about where they are going to stay and expand, or where they are going to go, is the quality and quantity of available talent to fuel their growth.”
The key to economic success in the decades to come lies in building Minnesota’s human capital today. Minnesota’s economy will be vibrant if the state has a skilled and highly educated workforce second to none. Our own history is the best proof.
In 1940, Minnesota ranked 31st of all states in the percentage of its citizens with a bachelor’s degree or higher, and our per capita income ranked 26th — middling at best. Beginning after World War II and continuing through the 1980s, Minnesota made major investments in education. By 2010, Minnesota ranked 11th in bachelor’s degrees or higher and had climbed from 26th to 12th in per capita income.
Building human capital can’t be done overnight. As our own history shows, it takes a sustained commitment to high levels of investment in education. In the 1970s and ’80s, Minnesota invested between 12 percent and 16 percent of its state budget in higher education. Unfortunately, what we have seen over the last decade is one state budget deficit after another. And one of the worst consequences has been a deep decline in state investment in higher education. Today higher education is down to just 7 percent of our state budget.
This disinvestment threatens our economic strength. While we have slipped in building human capital, our global competition is rising. We compete not only with other states but also with other nations — and today 11 countries rival or surpass Minnesota on degree attainment.
Wisely, Gov. Mark Dayton is proposing that Minnesota change direction. His budget recommendations will make Minnesota’s state budget structurally balanced by acknowledging the need for revenue increases, and by using new revenues to make strategic investments in education — from early childhood through higher education.
As college and university presidents, we especially applaud the governor’s leadership on higher education, particularly his proposed new investment of $80 million in need-based financial aid for college students through the Minnesota State Grant program. The State Grant program targets student aid to low-income and middle-class students — those who most need state support to complete college — whether they attend public or private colleges, full-time or part-time, in two-year or four-year programs.
The Minnesota Chamber of Commerce has highlighted the State Grant program as a “model of efficiency and effectiveness.” Why is need-based financial aid for college students a good investment? A strong body of research has found that need-based financial aid:
• Increases enrollment in college, especially among students for whom cost is the biggest barrier.
• Increases on-time graduation rates, which is the most effective way to reduce the total cost of a college education.
• Increases student learning, by reducing the excessive hours students need to work during the school year just to pay for their education.
• Reduces student debt, which has reached levels that deter some students from going to college or completing their degree on time.
And by funding financial aid that goes directly to the students, the state promotes healthy competition among institutions — competition that holds down price and drives up quality — while giving students the ability to choose the college or educational program that will do the most to develop their individual economic and human potential.
MaryAnn Baenninger is president of the College of Saint Benedict. Brian Rosenberg is president of Macalester College. The Rev. Dennis Dease is president of the University of St. Thomas. Paul Pribbenow is president of Augsburg College. They wrote this article on behalf of the Minnesota Private College Council.