Investing in higher education is a win-win

After nearly two decades of declining state support for higher education, Gov. Arnold Schwarzenegger is stepping forward to propose restoring some funding for the California State University, the nation’s largest four-year university system.

He’s backing up his proposal with a threat to veto any budget that doesn’t include the $365.6-million boost for the state system for next year. While this is great news, the funding will only partially replace the “one-time” budget cuts made last year, and legislative approval of the governor’s proposal is far from certain.

Even if the proposal is approved, it won’t make up for the years of reductions that shrank the university systems’ share of the state budget from 11% in 1984 to 5.7% last year. Currently, higher education gets less than 60% of the state funding that prisons get.

In the last year alone, the California State University lost 21% of its state funding, forcing the system to slash enrollment by more than 40,000 students, increase student fees, furlough employees two days a month and lay off some staff.


All this comes as demand for a college education is on the rise. Applications to Cal State campuses were up by 28% this year, as recent high school graduates, community college students applying for a transfer and unemployed workers sought to improve their opportunities in a tight job market.

For half a century, the state colleges have represented a ladder up for their students. They have made entry into the middle class possible for the state’s working class and ensured that businesses have the educated and diverse workforce they need. But today, funding losses are closing doors at California’s universities. Failing to invest in higher education could sacrifice the future of a generation of Californians and jeopardize the state’s economic future.

The Public Policy Institute of California predicts that if the state doesn’t increase higher education funding, it will have 1 million fewer college graduates than it needs by 2025. The institute acknowledges the difficulties of finding the needed investments in the current budget climate, but it says failing to do so “will cost California even more.”

Just how much more is evident from a new study by ICF International. It found that the California State University system’s 1.96 million graduates employed in the state earn an additional $42 billion annually because of their advanced degrees. Losing the economic activity that future graduates would generate could cost California hundreds of thousands of jobs and dilute the most important ingredient in California’s economic success: a highly educated, diverse workforce capable of fostering the innovation and entrepreneurship of the 21st century.


Producing 92,000 graduates a year, the 23 campuses in the Cal State system are a leading provider of California’s workforce. Last year, 13,000 new teachers — half of all the state’s new teachers — received their credentials from one of the system’s campuses. Cal State also leads California’s other institutions of higher education in providing workers in the fields of information technology, nursing, business, engineering, agriculture, tourism and media — critical industries accounting for more than 5 million jobs in the state.

The university system also generates jobs and improves the lives of Californians through partnerships with private industry. Engineering students at Cal State Long Beach, for instance, helped a California business grow by designing and fabricating the Mighty Max, a sewer-cleaning machine. Businesses rely on the San Fernando Valley Economic Research Center at Cal State Northridge for expert information on the Valley’s economy. The Structures, Propulsion and Control Engineering (SPACE) Center at Cal State Los Angeles is developing state-of-the-art computing tools and techniques for modeling, controlling and simulating aircraft of the future.

In a time of two wars, Cal State Dominguez Hills is improving the lives of returning soldiers through a partnership with the Long Beach Veterans Hospital. Together, they train students in orthotics and prosthetics to create the skilled workforce needed to help wounded war veterans overcome their injuries through the use of mechanical limbs and other devices. The Dominguez Hills program is the only one of its kind in California and one of only nine nationwide.

Growing California’s economy is critical, and the California State University is crucial to that mission. But to keep higher education healthy, the state has to increase its investment.

Charles B. Reed is chancellor of the California State University, the country’s largest system of public higher education, with 23 campuses and seven off-campus centers.