For North Carolina Community Colleges, Lessons From the Great Recession

• Community college enrollment tends to increase during recessions.
• The current strong labor market means fewer people are seeking higher education degrees and certifications.
• Community colleges should expand work-based learning to boost enrollment, according to a North Carolina Department of Commerce report.

Community college enrollment has been declining for more than a decade — a trend accelerated by the COVID-19 pandemic. But that could change if the U.S. enters a recession, according to a new report.

College enrollment tends to decrease as job openings increase, according to the report from the North Carolina Department of Commerce. And although the labor market is currently strong, with more jobs than job seekers in North Carolina, the report notes that people without degrees or training could be disproportionately affected by an economic downturn.

"During the Great Recession's labor market slump, people without high school diplomas had unemployment rates nearly double that of individuals with some college education or an associate degree and more than triple those with bachelor's degrees or higher," the North Carolina report says.

There were similar trends during the short recession in the early days of the pandemic in 2020, according to the report.

The report also notes that a "less skilled and resilient workforce will curtail economic and business growth by limiting employers' ability to hire the people they need." That would, in turn, limit North Carolina's ability to attract new businesses and industries, according to the report.

In a "tight" labor market, when there is an abundance of job openings and a scarcity of workers, employers increase the hiring of workers of color, people with disabilities, people with criminal records, and historically marginalized groups, the report says. Young people who lack prior job experience also benefit from the current tight labor market, according to the report.

"Since total employment in the state bottomed out in April 2020 and the labor market regained its footing, employment among Black workers has increased by about five percentage points more than white employment, while the number of employed people between ages 16 and 24 has nearly doubled," the report says.

But the report notes that, in an economic downturn, "the same workers are often the first people employers let go."

"While gains in aggregate employment for historically marginalized or hard-to-hire populations are certainly positive developments, it also means these same populations might be turning down educational opportunities that could make them more economically resilient," according to the report. "During the next economic downturn, longstanding biases might lead to layoffs for these workers first and they could find it hard to find a new job without advanced skills and credentials."

The current economic situation is in many ways unique: The Wall Street Journal reported last month that, although the United States' economic output is falling, the job market remains strong.

The tight labor market means that businesses are increasing wages in a bid to attract workers, according to the North Carolina report, which can make it difficult for people to turn down an offer in favor of seeking a credential or degree from a community college.

The report recommends expanding work-based learning opportunities, which many community colleges in the state already offer, in order to let students earn degrees and credentials while also taking advantage of abundant job opportunities.

Many major companies have partnered with higher education institutions in recent years in a bid to educate their workforces. Last month, Amazon partnered with the University of North Carolina at Greensboro as part of its Career Choice program, which offers prepaid tuition to the company's hourly employees.

Amazon wants to upskill more than 300,000 hourly employees to work in high-demand fields by 2025. And it is investing $1.2 billion as part of that effort. Amazon isn't the only large company to boost its workforce training efforts in recent years: Google, Microsoft, and IBM have partnered with community colleges to train employees in recent years.

Community college enrollment declines continued into the spring 2022 semester, according to a recent report by the National Student Clearinghouse Research Center.

However, some career-focused programs saw signs of recovery: Construction programs saw 19.3% enrollment increase; mechanic and repair programs saw an 11.5% increase; precision and production programs saw a 16.7% increase; and culinary programs saw a 12.7% increase.

Enrollment in the North Carolina Community College System increased by 20% over three years after the labor market downturn during the Great Recession, according to the Department of Commerce report, and community college leaders should anticipate boosted enrollment during any future downturn.

"Leaders can take the opportunity to shore up program offerings and align training and education programs with changing workforce needs to prepare a well-educated and highly trained workforce to continue North Carolina's economic success," the report says.