The Earnings of Community College Graduates in California. A CAPSEE Working Paper

In this study, I draw on longitudinal data for 1.1 million students in California to estimate the effects of community college credentials on students' earnings, as compared with students who are not awarded a credential. In contrast to much of the recent work on this subject, which assumed that the effects of credentials on students' earnings are constant over time, I estimate the effects of credentials on the rate of change in students' earnings and allow these effects to vary over time. I find significant earnings gains for all levels of credentials, including low-credit awards requiring fewer than six credits. Returns to associate degrees are the most durable over time, while returns to short- and long-term certificates and low-credit awards are strong initially but begin to flatten or decline by seven years after the award. I find substantial variability in returns by students' race/ethnicity and gender. Black men and Black women experience especially strong returns to associate degrees and long-term certificates, relative to other students of the same gender but different race/ethnicity, and men of all racial/ethnic groups experience much stronger returns to short-term certificates than do women. I also note wide variation by field of study in returns to credentials. The most consistent returns across levels of credentials are found in the biological sciences, engineering and industrial technologies, health, law, and public and protective services. Finally, I find compelling evidence of the need to distinguish returns after a credential is awarded from returns after a student has finished (or otherwise left) postsecondary education, as argued in recent work. Appendix A presents the author's approach to reconciling units of time. Appendix B lists the distribution of subfields of study for all credentials awarded in the CCC system from Fall 2002 through Summer 2013, by level and field of study.