Co-op Programs in Higher Education

Co-op Programs in Higher Education

  • August 6th, 2019

A Partial Solution to Alabama’s Labor Shortage:
Co-op Programs in Higher Education

An old idea, integrating work experience into the formal education process, may be just what is needed to solve the labor shortages building in Alabama’s metropolitan areas. With unemployment rates between 3.3 and 4.7 percent in the state’s four largest metropolitan areas, labor shortages are the biggest single problem facing economic expansion. These shortages have occurred because the nation’s birth rate leveled off following the explosive “baby boom” period. Relying upon new workers coming to Alabama from other places is an unlikely short-run solution because other states have their own shortages of qualified workers.

Growing the State’s Labor Force without New Residents
The labor force is made of the people aged 16 and over who are employed or actively looking for work. This means retirees, students, and others not actively looking for work are not in the labor force. Retirees who take a part-time job to avoid boredom increase the size of the workforce. So do students who seek part-time jobs. Seniors and full-time students who work increase the size of the labor force without any change in the size of the population. While retirees often return to the labor force for non-financial reasons, students are increasingly motivated by rising college costs.

Higher Education Costs and Part-time Employment
Declining state support for higher education results in rising tuition. Nationally, college tuition rose 5.6 percent in 1996, compared to consumer price increases of 3.3 percent. Higher costs motivate students to supplement their incomes while attending college. Students generally prefer part-time to full-time employment in order to make steady progress toward graduation. A student who takes a job for pay, even 10 or 15 hours per week, constitutes an increase in the labor force.

Creating Partnerships: A Win-Win-Win
Many firms are becoming creative in human resource management to solve their labor shortages. Finding skilled full-time employees is a greater and greater challenge. Yet, at the same time, increasing numbers of college students need to work to offset rising tuition rates. A solution is to create jobs relevant to the students’ career objectives and at the same time relevant to a firm’s employment needs. If firms can offer such opportunities and students can obtain “credit” for the work experience, there will be a win-win-win situation. Yes, win-win-win. The student obviously wins by earning extra income, relevant on-the-job experience, and appropriate academic credit. The company benefits from adding a productive employee to the workforce and solving a labor shortage problem. And society benefits through a growing economy and lowered inflationary pressures created by scarce labor.