Does Developmental Education Improve Labor Market Outcomes?

Nationally, about two thirds of community college students are considered academically underprepared for college-level coursework and referred to developmental education, which is intended to prepare students for college-level coursework in math and English. Yet, many of these students drop out early without reaching college-level courses, and among those who do successfully progress into college courses, many do not earn a credential or degree. For example, among recent high school graduates who took at least one developmental course in community college, only one quarter earned a degree within eight years.

As a result, developmental education may represent the primary form of postsecondary education that many community college students receive. One question that many students and policy makers thus wonder is: Does developmental education improve students’ labor market outcomes?

Developmental coursework may yield benefit through “skill development”

In a research study supported by the Center for Analysis of Postsecondary Education and Employment (CAPSEE), Michelle Hodara and I used college administrative data from all community colleges from two states and estimated the labor market returns to developmental credits versus college-level credits for two cohorts of students. We found that, in both states, earning developmental reading and writing credits led to an increase in earnings, which was many times larger than returns to college-level credits, suggesting that developmental English may be worth students’ time and resources even if they do not progress into college coursework. However, this increase seems to be primarily driven by a positive impact on the likelihood of employment, not quarterly wages. In other words, developmental English courses represent a benefit for individuals whose language skills posed a great impediment to securing a job, but the credits did not lead to increases in wages through career advancement or promotion. Indeed, in the labor economics literature, English proficiency and strong communication skills have long been tied to a greater likelihood of employment for immigrant populations.

Developmental coursework also involves “opportunity cost”

In contrast, in both states, we found negative impacts of developmental math on both the likelihood of employment and quarterly wages. There are two possible explanations for why students who take developmental math coursework may not benefit from it in the labor market. The first is related to curriculum and instruction. The algebra-based content of typical developmental math classes is not tied to the quantitative skills required in the labor market. Further, the typical instructional approach in developmental math classrooms emphasizes drill and practice instruction, and thus content is taught in a decontextualized way not directly connected to the content, skills, or knowledge in any particular field of study.

The second is related to the length and complexity of the developmental coursework. When students enroll in college, they spend time away from the labor market or they work less, so they are faced with “opportunity costs” from forgone earnings and work experience. The traditional developmental sequence structure typically consists of a set of multiple courses that students must enroll in sequentially and that do not count toward their degree program requirements. As a result, students at the lowest levels are often required to complete at least three semesters of developmental coursework for the corresponding subject area. The length and complexity of the developmental sequence increases the opportunity cost of schooling, in that students need to spend extra time and resources on developmental education instead of in the labor market gaining wages and working experience.

In other words, the economic and academic burden imposed by a long sequence of developmental education may outweigh any potential benefits. Indeed, in our research, we found that the negative impact of developmental education is largest among students assigned to the lowest level of developmental math.

Policy implications for developmental education

In sum, impact of developmental credits on labor market outcomes depends on a balance of positive skill development and negative opportunity costs. All education bears opportunity costs, but developmental education is particularly costly because the courses do not count toward a degree program. These findings provide support to the growing view that current developmental math course curricula may fail to impart the kinds of skills and knowledge students need to be successful in the labor market, and that a long sequence of developmental education courses imposes a strong opportunity cost on students that may outweigh its benefits.

There has been a national trend in reforming developmental education, especially by shortening the length of the developmental sequence. Such reform has the potential to minimize the negative opportunity costs associated with spending time and resources in courses that do not count toward a degree program.

Further, colleges may also consider combining acceleration with curriculum reforms that are working to improve positive skill development by better aligning curriculum to the skills and knowledge needed in college coursework and in the labor market. Developmental education has the potential to have a positive impact on labor market outcomes by increasing its positive skill development and minimizing its negative opportunity costs.