State funding for higher education and the workforce – NH Business Review

First Published in NH Business Review, September 21, 2023

New Hampshire’s workforce constraint has become more severe since the beginning of the COVID-19 pandemic, with more than three job openings for every unemployed worker in June 2023 compared to less than two openings per resident seeking work just before the pandemic.

With temporary effects from the pandemic waning, the state’s older demographic structure is likely the primary cause of stalled labor force growth.

Alongside enhanced access to child care and housing, retaining college-bound young people is critical to bolstering the workforce. One retention strategy may be to make attending college within the state more affordable, as young people who leave New Hampshire for education may be more likely to build their careers elsewhere. New Hampshire lost 56% of its four-year, college-bound high school graduates to other states in 2020, a higher percentage than every state except Vermont. Maine lost only 38%.

New Hampshire’s funding of public higher education ranks lowest among U.S. states by several key metrics, which likely contributes to higher public education tuition and fee costs in the Granite State.

The state’s estimated contribution to higher education funding per capita was $106 in fiscal year 2023, while the next lowest was Pennsylvania at $153 per capita. The national average was $338. To match the national average, New Hampshire would have needed to put $318 million more public dollars into higher education in fiscal year 2023.

New Hampshire also had the lowest state contribution to public higher education relative to each $1,000 of estimated personal income in fiscal year 2023, at $1.43 per $1,000 compared to $2.36 in Pennsylvania and $3.06 in Vermont, the next lowest states. The national average was $5.22.

Additionally, in fiscal year 2022, New Hampshire contributed $3,699 per full-time equivalent student. Next-lowest, Pennsylvania provided $6,090 per full-time equivalent student. The national average was $10,237.

Public higher education in New Hampshire can be expensive in relative terms, which may deter in-state attendance for residents. Several institutions in Massachusetts and New York either match, or offer lower, out-of-state tuition than in-state tuition at the University of New Hampshire.

Graduates of New Hampshire institutions in 2020 who acquired student debt carried the highest average debt load in the country. The Granite State had the second-highest rate of students graduating with debt among all 50 states.

More state support for New Hampshire’s public university and community college systems could be used to help retain and upskill the workforce while limiting debt carried by Granite Staters.

Nicole Heller is senior policy analyst of the NH Fiscal Policy Institute. The NHFPI Policy Memo is a partnership of the NH Fiscal Policy Institute and NH Business Review.