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Chancellor Milliken Remarks – Texas Economic Development Corporation Four-Year Institutions Partnership Meeting

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Introduction

Thank you Robert, for that introduction, for your leadership of TxEDC, and for being such a great partner to the University of Texas System.  Thanks to Chairman Daniel and everyone at the Texas Workforce Commission as well.

Texas’s greatest strength is its people, and we all want to make the most of that strength by making sure Texas workers – and by extension, Texas enterprises and organizations of all kinds – can compete, win, and prosper.

It’s on all us to produce the kind of workforce Texas needs – the next generation of innovators, entrepreneurs, health professionals, teachers, you name it.  By “us” I mean the TWC and TxEDC, to the Texas Education Agency, Texas Higher Education Coordinating Board, the legislature, and educators – from early childhood on.  Everyone has an important role to play.

Education Beyond High School a Big Advantage

Younger workers have had a particularly challenging time during the past year.  In February 2020, the unemployment rate for Americans aged 20 to 24 was 6.3%.  By May it had nearly quadrupled to more than 23%.  It’s now a shade below 10% -- still 50% higher than a year ago. (Source: Bureau of Labor Statistics)

While no group has been spared during the pandemic, workers with education beyond high school are more likely to be able to work from home, and have – relatively speaking – been more insulated from the downturn.

In January, the unemployment rate was 9% for those without education beyond high school, and 4% for those with at least a bachelor’s degree, according to the Georgetown University Center for Education and the Workforce.

If we had any doubts, we have learned that the people of Texas understand the need to get education beyond high school.  And they’re willing to take on – and able to overcome – big obstacles to make it happen.

Resilience and Adaptability

Prior to last March, fewer than 20% of UT System faculty had ever taught online, and just 40% of students had taken a single course online.  Almost overnight, 100% of both faculty and students were online.

For many students, it was exceptionally difficult.  Some lost jobs, were forced into family caregiver roles, or became sick themselves. Caring and accounting for the mental health of every member of the campus community was, and remains, a major challenge. 

The pandemic also revealed challenges Texans face with availability of Internet access, whether because of broadband limitations, subscription costs, or hardware ownership. 

According to the Texas Demographic Center, 1.6 million households in the state lack reliable Internet service.  This includes the homes of approximately one in five UT institution undergraduates.

For many students – especially those from low-income families – the shift to remote learning presented an additional obstacle between them and a degree.  We need to bridge the digital divide if we want to match talent with opportunity and unlock the potential and productivity gains we’ve only caught a glimpse of during the past year – in remote delivery of education as well as health care, and in working remotely. 

Governor Abbott has declared broadband as an emergency item for legislative consideration, acknowledging that it is a necessity for every Texan – from preschoolers to adults, and from big cities to rural outposts.  Broadband delivers access to the information and connectivity we all need to be 21st century learners, to work remotely when possible, and increasingly, to receive quality health care.

Our students persevered, because they understand what’s at stake

Despite the challenges, the vast majority of our students have been able to continue their education.  The number of UT students who earned a degree in the spring was up 5% versus 2019.  Summer enrollment was up an astounding 23%.  And, in contrast to the national trend—which was a decline in enrollment – last fall’s enrollment across the 14 UT institutions was up 2% -- with freshman enrollment up at 6 of the 8 academic institutions.

Our great challenge is to ensure a strong return on that investment – not just for them, but for the businesses and organizations who need today’s workers and tomorrow’s leaders.

Return on Investment

So let’s talk about ROI.  We all know that to maximize your ROI, you want the R to go up and – ideally – the I to go down.

So let’s start with the I, investment – in other words, what it costs to earn a degree.

The Investment

Part of helping students prepare for the future of work is making sure they do not enter into it saddled by an unreasonable debt burden.  Today six UT academic institutions have guaranteed financial aid programs in place that completely cover tuition and fees for families up to a certain income limit, ranging to a high of a family income of $95,000

On average, UT institution graduates start their post-college lives with less debt than their peers around the country.  In the class of 2019, 51% of graduates had student loan debts, and the average amount of debt among that group was just under $21,000.  This compares to 56% of undergraduates at public four-year institutions nationally, who leave with nearly $28,000 of debt, on average. 

The Return

Now let’s talk about the return.

At the UT System, we’re working hard to let students and families know everything we know about the economic impact of their educational choices.  Through a historic partnership with the US Census Bureau, the Texas Higher Education Coordinating Board and the Texas Workforce Commission, the UT System is a national leader in collecting, analyzing and sharing this important information.  

Our seekUT website provides salary and debt data of all undergraduate and graduate students, by degree program, up to 10 years after college graduation.  Students and parents can get information they need – based on the actual experiences of recent graduates – to set realistic debt and income expectations, based on institution, major, and job location.

While I’m convinced there is no better investment than a UT degree, the world of work has changed, and if we want to fulfill our role, and meet our responsibilities to the people of Texas, we need to change with it.

Better Connecting with the Job Market

For example, we have an opportunity and an obligation to better connect with the job market we’re sending our graduates out into.

Despite recent employment gains, this is still a challenging time for recent graduates.  According to a recent Wall Street Journal column, in the past year, hiring for entry-level college-graduate positions has fallen by 45% -- more than any other education category.  The first job after graduation is critical to launching a career. Those who start behind tend to stay behind.  And those who are underemployed after graduation are far more likely to stay in mismatched jobs after five years than those who start with a college-level job.

It’s no surprise that unemployment has disproportionately impacted people of color.  For example, unemployment nationally among people of color with Associate’s degrees is equivalent to unemployment among whites with less than a high school diploma.  In the fourth quarter of 2020, an African American age 20 to 24 was nearly twice as likely to be unemployed as a white person of the same age (16% black, 8.8% white per Bureau of Labor Statistics).

But regardless of race, getting and keeping a good job after college is less and less about where you went or what you studied, and more about what skills you have.  So we need to ensure that graduates acquire the skills the market is demanding.

Pandemic amplified this challenge

The pandemic is accelerating structural shifts in our economy that were already underway due to automation and digitization -- eliminating or significantly altering millions of jobs.

Across Texas, displaced workers are going to need specialized education to help them successfully reenter the post-pandemic economy.

At the same time, new graduates struggling to secure full-time employment need opportunities to distinguish themselves – beyond their education and talent – with industry-recognized certificates and credentials.

New mindset:  Education and Training shouldn’t be two separate systems

We need a new mindset.  For too long, education and training have been viewed as fundamentally different and separate systems – the things people learn in one system are often not recognized by the other.

What we need, in my view, is one integrated system that delivers the learning and skills people will need throughout their careers, with a minimum of friction along the way.

To work, such a system must deliver transparency.  Workers need to understand the knowledge and skills they will need to advance in their careers – so they can seize the opportunities that are out there.  And employers need to know what a given applicant knows and can do.

Up-skilling

I believe that the job of reskilling and up-skilling workers, whether displaced older workers or recent graduates, is the responsibility of all of post-secondary education, including our universities. 

Our presidents and I are working to identify and develop best-in-class programs for credentials and skills, recognized by industry, so we can offer them to students and graduates throughout their careers.

Texas Credentials for the Future

Working with our partners at the THECB and the TWC, we plan to expand and create new short-term, industry-recognized credentials that are in high demand for recent graduates, stopped-out students, adults with some college and no degrees, and displaced workers.

For us this work has been given a boost by a national task force of presidents and chancellors of forty universities and community colleges, public and private, rethinking higher education to maximize our contribution to society, especially in the wake of the pandemic, economic upheaval and persistence of racial inequities. 

One outcome of this work is our goal to offer a wide variety of certificates and credentials focused on high-demand, low-supply occupations.

We are going to take a hard look at labor market data before deciding which areas we want to focus on.  And most important, we want to partner with the private sector to meet their needs in terms of numbers and skill levels.  We plan to scale existing offerings and create new ones, all in collaboration with employer, industry, and state partners.

The goal is to establish pathways to students, recent graduates, and  displaced working adults– particularly the underserved and those at greatest risk of unemployment or underemployment – that lead them to new, marketable skills, and career opportunities.

And we’re not alone.  It aligns well with the Governor’s Tri-Agency Workforce Initiative, and will build on and strengthen overlapping priorities of the TWC, THECB, and all our states institutions of higher education. 

Conclusion

Shifting from our traditional model to one that incorporates an emphasis on skills and lifelong learning is a big change – and it won’t be easy.  But one lesson of the past year is that dramatic change – even in higher education, which is not exactly known for it – is both possible and necessary.

What we’ve accomplished when it comes to remote delivery of both education and medical care – the acceleration of progress that would otherwise have taken years or decades – can be described as silver linings.

And my hope is that we’ll take this realization – that we are capable of change – and let it motivate us to keep our foot on the gas.  Because even when the pandemic is over, we are going to have to keep evolving.

The shift to large-scale remote learning has opened the door to what’s possible.  We need to take advantage of this moment in time, and make work-relevant learning available to anyone who wants it.

In many ways, the pandemic has brought out the best in our state’s institutions.  But the work we’ve done, and the changes we’ve made, are just a down payment on the changes we will need to make going forward.

We all have important role to play, and I want to thank all of you – on behalf of the UT System – for your roles.  You can count on us to be your partner.

Thank you for your attention, and for all you do.