Indiana Commission for Higher Education

1. Indiana Commission for Higher Education Presentation on Employer Demand Information September 2008

2. Labor Market Information to Support New Degree Proposals: Robert Sandy Professor of Economics, IUPUI Assistant Executive Vice President, IU Outline: 1. State-level projections data base 2. Employer surveys 3. Changes in market conditions 4. BLS national projections 5. Surveys of similar programs in nearby states 6. Industry and occupation sources 7. Potential uses of IWIS for degree proposals

3. Disclaimers: •All of the opinions expressed herein are my own and have not been reviewed or approved by Indiana University •I primarily use examples from IU campuses because I am familiar with the recent IU proposals. The lack of other examples does not imply that the labor market demand sections of proposals from other institutions are in any way deficient.

4. State-level projections data base • Website: • www.projectionscentral.com • •Allows comparisons with nearby states • •Campuses near a state border can project within Indiana and nearby employment gains • •Detailed occupational categories • •Projections to 2014

6. State-level projections data base (continued) • •forecast areas of the state by current employment fraction • •cannot be used for degrees in new fields • •cannot be used for degrees with too few employees to project, e.g. Indiana lists NA for economists • •cannot be used for broadly based training, e,g. a Masters in Liberal Arts

7. 2. Employer surveys •examples a) Master in Taxation at IUPUI surveyed large accounting firms that recruit at IUPUI b) Master in Social Work at IU Richmond surveyed social service agencies in Richmond area c) BS in Music Technology surveyed firms in Indiana in music production and sound design industry •feasible in narrowly defined fields •benefit of alerting potential employers of the program and gaining input on program design

8. 3. Changes in market conditions •Projections are based on fixed coefficient models of industry employment, e.g. proportion of accountants currently used by banks, large employers, accounting firms scaled up by forecast of growth in these industries based on trend lines. •the ICHE can be convinced that market has or will change. a) Master of Taxation at IUPUI argued that Sarbanes Oxley Law fundamentally changed the demand for taxation experts by putting much higher penalties on corporate board members. b) Ivy Tech convinced the ICHE that ageing baby boomers will require more services by dental hygienists. c) School of Rehabilitation Science at IUPUI convinced the ICHE that serving wounded war veterans would expand the amrket for this Ph.D.

9. 3. Changes in market conditions (continued) •limited to situations in which legal environment has clearly changed or population being served will clearly change

10. 4. BLS national projections •website: http://www.bls.gov/oco/ •has projections for which the Indiana state level is not available •can be scaled to the state level

11. 5. Survey similar programs in nearby states •if all graduates in nearby states have jobs before graduating that is a strong case for a new program in Indiana, Examples: a) Master of Taxation at IUPUI b) Ph.D. in Biostatistics at IUPUI c) Ph.D. in African American and African Diaspora Studies at IU-B

12. 6. Industry and/or occupation sources •trend of job listings at a national source, e.g. Job Openings for Economists, trend of applicants registered with the American Economic Association •Master of Taxation at IUPUI presented both demand and supply data from the American Institute of Certified Public Accountants

13. 7. Potential uses of IWIS for degree proposals IWIS could be used to pinpoint in-state employment and earnings by graduates of public colleges in Indiana for specific CIP codes. •example, the graduates of the new Purdue BS in Forensic Science at IUPUI could be tracked. Suppose that the graduates are doing well in terms of employment and earnings but that they are concentrated in central Indiana. In this situation the IWIS data could be used as the basis for starting another Purdue BS in Forensic Science in Fort Wayne.

14. 7. Potential uses of IWIS for degree proposals (continued) IWIS could be used to estimate the value added for the State of Indiana from an existing degree program. •for example, if almost all of the graduates of an existing BA or BS program leave the state it might be a poor candidate for starting a second program at another campus.

15. 7. Potential uses of IWIS for degree proposals (continued) •the longitudinal nature of the data allow estimates of the gains in earnings. Suppose the higher earnings in certain counties in Indiana for associate degree graduates compared to BA/BS degree graduates were due to the associate degree graduates being older, having more labor market experience, and coming into the associate degree programs with higher earnings than the BA/BS degree entrants. Without estimating the value added the State would be under the false impression that it would receive more lifetime tax income from an associate degree graduate than from a BA/BS graduate.