1 © FSG |

Northeast Region (N.E.) PREPARED FOR ACCELERATE NEBRASKA | FEBRUARY 2016

2 © FSG |

Executive Summary STATEWIDE AND REGIONAL SUMMARIES

3 © FSG |

Statewide summary

FOUR STATEWIDE OPPORTUNITIES & KEY DATA POINTS Research suggests several opportunities to better align Nebraska’s education system with the state’s labor market:

STATEWIDE FINDINGS • While the current population is predominantly white (89.4%), growth in the minority population accounted for two-thirds of Nebraska’s

overall population growth in the 2000s

• Overall the poverty rate has held steady at 12.8% and unemployment is at 2.9%, however, these numbers vary drastically for minority populations with over 28% of the Hispanic population living in poverty and unemployment reaching 15% for the black population

• Nebraska has among the nation’s highest high school graduation rate (90%), but there is a large achievement gap between minority and low income students and their white counterparts

• There is a strong college-going culture (69.5% college-going rate), but some students are not college ready as evidenced by high developmental education numbers and average completion rates

• The majority of Nebraska’s jobs are low and middle wage, which is misaligned with the number of four-year degrees the state produces, leading to underemployment and brain drain

Increase the number of high skill, high wage jobs • A high school diploma or less will be required for almost two-thirds of jobs in 2020. Relative to those needs, Nebraska has more than

double the required number of recent graduates (aged 25-34) who attended some college or received an associate’s degree. Nebraska must create more high-skill jobs to keep the educated young people who are critical for the state’s future success and contribute to the state economy and tax base.

Decrease the achievement gap for Nebraska’s low income and growing minority populations • Minority and low income students are more than twice as likely to test below passing than white students on the 11th grade Math NeSA.

Nebraska must provide minority and low income students and their families with additional supports if it wishes to ensure that these individuals will enter the labor market at similar rates and wages as their white counterparts.

Align on expectations for K-12 education outcomes • Nebraska’s average ACT score of 21.5 and 90% high school graduation rate (in 2014) are near or above national averages, yet nearly 40%

of all students test below passing on the 11th grade Math NeSA. Nebraska must create clear standards to ensure that it does not continue to pay to teach students the same materials multiple times (e.g., once in high school and again in developmental education courses).

Increase persistence and completion rates at the postsecondary level • Postsecondary completion rates are on par with national averages (Bachelors: 55.1% NE vs. 55.5% U.S.; Associates: 30.3% NE vs. 29.2%

U.S. in 2013), but have plenty room for improvement. Nebraska must improve retention and completion to ensure it does not continue to use resources educating students who drop out of college.

Source: FSG analysis

4 © FSG |

Northeast summary

Northeast is a small, low-population, region with a diverse population (e.g., Hispanic and Native American) that holds fewer four year and above degrees than the state as a whole. Minority high school students in the region have large achievement gaps leading to lower regional and district graduation rates for those students. Given the projected employment mix, the region can work to attract new businesses that would require a higher skilled workforce.

Demographics • N.E. is a rural region of Nebraska with 8% of the state’s population. It is home to one of the largest Native

American populations in the state • N.E.’s rural nature and employment mix results in a population that has 35% fewer four year and above

degrees than the state average

K-12

• N.E. hosts approximately 8% of all the high school students in Nebraska • N.E.’s largest districts (Norfolk PS and South Sioux City Community Schools) have large white and

Hispanic student populations. Additionally, Thurston County is home to over 1/3rd of the Native American students in the state

• The region’s largest districts have significant Math achievement gaps between white and Hispanic students where Hispanic students are a little less than twice as likely to test below passing on the 11th Grade Math NeSA than white students

• Despite testing poorly on the 11th Grade Math NeSA, minority students still graduate from the largest districts at a high rate (75%+ graduation rates)

Postsecondary education (PSE)

• N.E.’s two postsecondary institutions, N.E. Community College (NECC) and Wayne State College, serve the full suite of students in the region

• NECC serves traditional two-year degrees seekers as can be seen through the above average number of students who complete an Associate Degree and not transfer

• Wayne State serves primarily older, nontraditional students who tend to work in educational services upon graduation

Labor market • Following in line with the current levels of regional educational attainment, only 14% of jobs in 2022 are

projected to require a four year and above degree • The projected fastest growing industries are truck drivers and meat cutters

5 © FSG |

Demographics RURAL AND DIVERSE REGION WITH LOWER DEGREES OF HIGHER EDUCATIONAL ATTAINMENT

6 © FSG |

N.E. is a rural region characterized by a few pockets of denser settlement

Source: American Community Survey

The region represents 8% of the state’s population

Population by County

7 © FSG |

The N.E. population is primarily concentrated in Madison and Dakota County and is predominately white

Source: American Community Survey Note: As Hispanic is compiled as an ethnicity, it cannot be calculated in conjunction with race, due to significant data differences, data accounts for “one race alone” population

• N.E. is 90% white and is home to over 37% of all Native American populations living in Nebraska • Most of the minority populations living in N.E. reside in Madison (home to Norfolk) and Dakota

(home to S. Sioux City) counties; specifically a majority of the Native American populations residing in N.E. live in Thurston County

88%

90%

5%

4%

4%

4%150,403

1%

Nebraska (10% Hispanic) 1,841,625

2%

N.E. (10% Hispanic) 1%

1%

Asian Other Black Native American White

Population by Race/Ethnicity (2013)

8 © FSG |

N.E. has higher poverty rates than the state average and earnings that fall below the average

Source: American Community Survey

$27,162 Madison County

$26,417 N.E. Region

$29,093 Nebraska

Median Individual Earnings (2014)

Poverty rate

Madison County

15%

Holt County

12%

Cuming County

12%

Nebraska

13%

N.E.

15%

Dakota County

17%

9 © FSG |

N.E.’s rural geography and primary industries of employment result in lower levels of educational attainment than the average

N.E.’s rural nature and employment mix results in a population that has far fewer four year and above degrees than average

Source: American Community Survey

12% 13%27%

28%35% 28%

33%

34%

35%38%

29%19%

13% 14%7%9% 7%

10%

12,746 4% Graduate

Less than HS

Bachelors

Some college and AA

HS diploma

Madison County

22,595

N.E.

99,940 5%

Nebraska

1,190,921

Dakota County

Age 25+ Educational Attainment (2013)

10 © FSG |

K-12 Education MINORITY AND LOW INCOME STUDENTS FACE LARGE ACHIEVEMENT GAPS

11 © FSG |

Nine percent of all high school students in Nebraska reside in N.E.

Source: Nebraska Department of Education

• Norfolk Public Schools (NPS) and South Sioux City Community Schools (SSCCS) are the largest schools districts in the region

• Combined, both districts hold 32% of high school students in the region and are home to 3% of all high school students in the state

80,464

N.E. 7,818 9%

Total NE HS

students

Remainder of NE

88,282

N.E. High School Students as a % of the State

12 © FSG |

The N.E. region is home to large Hispanic and Native American student populations

Source: Nebraska Department of Education Note: Minority counts do not include “Other” category, Native Hawaiian was removed due to low numbers

Racial/Ethnic Breakdown of SSCCS

Overall, N.E.’s K-12 student population is ethnically diverse with large Hispanic (20%) student populations

13%

30%

35%

69%

30%

25%

SSCCS

West Point PS

N.E. Total

Nebraska

NPS

Wayne CS

% of Minority Students in the Largest N.E. Districts

69% 68%

24%

17% 20%

62%

7%

4%7%8%

6%

SSCCS

3,915

3%

N.E.

25,761

2%

2%

Nebraska

307,398

1%

White Hispanic Black

Native American

Other

Student Ethnic and Racial Breakdown

13 © FSG |

Overall N.E. students perform close to average on the 11th Grade Math and Reading NeSA

39%

35%

36%

35%

25%

23%

Nebraska

Proficient Advanced Basic

(below passing)

Northeast

30%

30%

41%

41%

29%

23%

Basic (below passing) Advanced

Northeast

Proficient

Nebraska

11th Grade Reading NeSA Performance

N.E. students test at a similar level to the state’s 11th grade NeSA average, with a slightly smaller population testing below passing in Math

11th Grade Math NeSA Performance

Source: 2014-2015 State of the Schools Report All regional performance data are weighted averages of county level data. Due to gaps in reporting regional NeSA scores will not add up to 100%. Please refer to regional presentation for additional insights.

14 © FSG |

42%

36%

63%

60%

37%

39%

32%

32%

21%

25%

-44%

Basic (below passing) Proficient Advanced

NPS Free and reduced lunch 1%

NPS Hispanic

NPS White

N.E. Overall

NPS and SSCCS have a significant Math achievement gap between white and Hispanic students

11th Grade Math NeSA Performance in NPS

Hispanic and low-income students at NPS and SSCCS are more likely to test “below passing” on the Math NeSA than their white peers

Source: 2014-2015 State of the Schools Report Note: Due to gaps in reporting, regions will not add up to 100%

11th Grade Math NeSA Performance in SSCCS

42%

48%

72%

70%

37%

31%

24%

24%

21%

21%

Basic (below passing)

SSCCS Hispanic

Proficient

1% SSCCS

Free and reduced lunch

Advanced

1%

SSCCS White

N.E. Overall

-24%

15 © FSG |

Native American populations in N.E. face even more pronounced achievement gaps

Source: Nebraska Department of Education Note: Umo N Ho N Ho Nation Public Schools was omitted due to lack of available data for NeSA scores. Due to gaps in reporting, district NeSA scores will not add up to 100%.

Ethnic and Racial Breakdown of all Thurston County Students

• Thurston County holds the majority of Native American students in the region (74%) and 1/3rd of the Native American students in the state (34%)

• Of schools in Thurston County, Pender is primarily comprised of white students (92%) while Walthill and Winnebago have high concentrations of Native American students (87% and 95%, respectively)

74%

20%

All students

1,762

4% 2%

Other Hispanic White

Native American

42%

23%

37%

36%

21%

41%

94%

93%Winnebago

Advanced Proficient

Walthill

Basic (below passing)

Pender

N.E. Overall

11th Grade Math NeSA Performance in large Thurston County Districts

16 © FSG |

Despite minority students at the largest districts testing poorly on the 11th Grade Math NeSA, they still graduate at a high rate

Weighted Graduation Rate

85%90%90%

SSCCS NPS

92%

Nebraska N.E.

Source: 2015 Higher Education Report Card

At NPS, minority students graduate 10% points below the rate of their white peers

Proficient or above on 11th

Grade Math NeSA

Graduation rate

Proficient or above on 11th

Grade Math NeSA

Graduation rate

NPS SSCCS

89% 64% vs White 94% 79% vs

79% 32% vs Hispanic 89% 25% vs

75% 33% vs Free and reduced lunch

86% 25% vs

17 © FSG |

Postsecondary Education REGIONAL POSTSECONDARY INSTITUTIONS TRAIN THE FUTURE NORTHEAST WORKFORCE

18 © FSG | Source: NE Coordinating Commission for Postsecondary Education, 2015 Nebraska Higher Education Progress Report

2014 Snapshot of N.E. Postsecondary Institutions

Enrollment (PT + FT)

5,145 (12% of all community

college students)

% minority enrollment

10% (20% community college average)

Retention rate 68%

(57% community college average)

Completion rate (6 year)

43% (26% community college average)

Enrollment (PT + FT)

2,991 (39% of all state college students)

% minority enrollment

12% (12% state college

average)

Retention rate 62%

(62% state college average)

Completion rate (6 year)

46% (41% state college

average)

Community Colleges: 42,005 total

CC State Colleges: 7,581 total

ST

Wayne State College

N.E.’s two postsecondary institutions are Northeast Community College and Wayne State College

19 © FSG | Source: Northeast Community College Note: X level(s) below is defined as needing XXX number of classes to be allowed to enroll in college equivalent course

No DE needed 39%

3 levels below 1%

2 levels below

29%

1 level below 32%

First-Time Student Math DE Enrollment

33%

11%

52%

60%African-American

Hispanic

White

Native American

DE Completion Rate by Student Race/Ethnicity

62%

No DE needed

2 levels below 8%

1 level below 30%

First-time Student Reading DE Enrollment

DE Completion Rate by Student Race/Ethnicity

26%

25%

38%

75%African-American

Hispanic

Native American

White

ST CC

Over 60% of NECC’s first time freshman enroll in Math developmental education courses

20 © FSG |

23%

32%

8%

8%

20%

24%

31%

17%5% 10%

14%2% NECC

3% Community College average*

2%

Left with < 30 credits Still enrolled Left with >30 credits No award

Certificate AA(no transfer)

AA (transfer)

Outcomes after Six Years for First-Time NECC Students

Source: Voluntary Framework of accountability * Does not include Metro Community College as they do not report to the VFA

NECC has about double the number of students complete an AA without transferring. This may potentially be due to the employment mix in the region

CC ST

An above average number of students complete an Associate degree and do not transfer at NECC

21 © FSG |

Industry % of NECC grads working in industry Avg. annual earnings*

Health Care 39% $18,395

Retail Trade 12% $14,239

Manufacturing 7% $35,121

Source: NeWorks Graduate Outcomes Study

Top Industries of Employed Graduates

Graduate Employment by County CC ST

Key insights

Most NECC graduates who stay in Nebraska, remain in the region and tend to work low wage jobs

Key insights

• Many NECC graduates remain in Madison County

• The average annual wage for a NECC graduate working in Nebraska was $20,091

• 12% of NECC graduates were minorities, this is comparable to the state average of 11.4%

• Over half of NECC minority graduates were still working in Nebraska

22 © FSG |

Wayne State graduates are primarily older, nontraditional students and tend to work in educational services

Top Industries of Employed Wayne State Graduates (2013)

Source: Graduate Outcomes Study, FSG interviews

Industry % of Wayne State grads working in industry

Avg. annual earnings*

Educational Services 43% $42,162

Retail Trade 10% $20,127

Health Care 9% $26,024

CC ST

• Wayne State College graduates are primarily older, nontraditional students; 65% are between the ages 25-34

• 70% of minority graduates and 68% of white Wayne State graduates were found to be working in Nebraska. Of the 68% of Wayne State graduates who work in Nebraska, 23% of them work in Douglas or Madison Counties

23 © FSG |

Labor Market FEW CURRENT AND FUTURE OCCUPATIONS REQUIRE FOUR YEAR AND ABOVE DEGREES

24 © FSG |

The major industries in Norfolk are healthcare, manufacturing, and retail trade

Source: American Community Survey, Nebraska Public Power District Note: Due to data availability, this analysis used the Norfolk MSA as a proxy for the region

Norfolk Major Employers Industry Employees

Faith Regional Health Services

Healthcare 1,275

Affiliated Food Midwest

Food Distribution 700

Norfolk Public Schools Education 705

Covidien/Medtronic

Manufacturing 601

Walmart Retail

438

25 © FSG |

Norfolk and the region have unemployment rates that fall below the state average

Category Nebraska City of Norfolk (2014)

Labor force participation Nebraska: 84% Norfolk: 71%

Unemployment rate Nebraska: 3.1% Norfolk: 2.5%

Major industries (% of population employed in industry)

1. Education and health care: 24%

2. Retail trade: 12%

3. Manufacturing: 11%

4. Professional services: 8%

1. Education and health care: 24%

2. Manufacturing: 16%

3. Retail trade: 12%

4. Accommodation and food service: 9%

Median earnings by educational attainment (aged 25 and over)

• Median earnings: $34,236

• HS diploma: $27,605

• Some college or AA: $32,210

• Bachelor’s: $43,503

• Median earnings: $30,976 • HS diploma: $27,293

• Some college or AA: $30,322

• Bachelor’s: $34,581

Source: American Community Survey, Nebraska Public Power District, Bureau of Labor Statistics Note: Due to data availability, this analysis used the city of Norfolk as a proxy for the region. All city or MSA unemployment data is from December 2014

26 © FSG |

Future occupations in N.E. will predominately be low and middle skill

Source: Nebraska Department of Labor Note: Employment includes only growth openings Note: Calculations include the Northeast and Sandhills Economic Development Region

711

725

Transportation 5,264 4,553

Construction 5,726 5,001

Manufacturing 25,002 23,976

1,026

Educational services 13,968 12,661

1,307

Health care 17,879 15,465

2,414

2012-2022 growth 2012 employment

Projected Fastest Growing Industry by Employment (2022)

Projected Fastest Growing Occupations by Employment (2022)

203

219

224

298

497

Secretaries

2,506 2,287 Food prep.

2,408 2,611 Nursing assistants

4,613

2,155 2,379

4,315 Meat cutters

Truck drivers 4,715 4,218

2012 employment 2012-2022 growth

27 © FSG |

2022 Long-term Occupation Projections by Educational

Attainment Needs

N.E. has the opportunity to increase the number of jobs that will require an Associates degree and above

Source: Nebraska Department of Labor, FSG interviews, American Community Surveys Note: Calculations include the Northeast and Sandhills Economic Development Region

47%

69%

35%

16%

13% 11%5%

2022

3%

2013

Some college and AA Bachelors HS diploma and below Graduate

In order to ensure future workers in N.E. are employed at their appropriate skill level, the region has the opportunity to attract new businesses that require a higher skilled workforce

“I think the CCs can provide a lot of the skilled labor we need, they are a better alternative to going to the 4 year school” – Business leader

2013 Age 25+ Educational Attainment

28 © FSG |

Appendix

29 © FSG |

Regional Breakdown

• The six community college districts are used as the geographic units of analysis since each covers a self-contained community, or educational ecosystem, within the state

• The six community college districts correspond to recognized, discrete regions within Nebraska with distinct demographic, geographic, and economic features

‒ Metro ‒ Southeast ‒ Northeast

‒ Central ‒ Mid-plains ‒ Western

Methodology

Research To compile this report, FSG collected data from a variety of sources: • Interviews with over 50 key stakeholders (see slide 50

for detailed list): – Representatives of each of the six highlighted

regions – Experts in K-12 education, postsecondary, labor

market, and state policy, as well as community leaders

• Secondary research and data collection – Statewide education and labor data – National education and labor data

Labor Market Data

• Labor projections are based on NE Works (i.e., Nebraska Department of Labor) data rather than the Georgetown’s Center on Education and the Workforce (CEW) reports. Given the methodology employed, NE Works data likely provides a more accurate estimate

– NE Works makes a determination about the skill level a given occupation requires and then builds projections based on the skill required

– Georgetown’s CEW starts with the current representation of workers at each education level in each occupation and builds its projections from that base

• Both projections are estimates, and actual results will probably be somewhere in the middle. NE Works likely underestimates the PSE credentials and degrees, while CEW likely overstates the projections

30 © FSG |

Interviewee list

1. Eli Aguilar, AIM

2. John Albin, Nebraska Department of Labor

3. Vinc Aulick, Aulick Industries

4. Richard Baier, Nebraska Bankers Association

5. Barb Bartle, Lincoln Community Foundation

6. Jeff Carstens, Wayne State

7. President Michael Chipps, Northeast Community College

8. Senator Al Davis, Nebraska Legislature

9. David Drozd, Nebraska State Data Center, UNO

10. Paul Eurek, Xpanxion

11. Dr. Vern Fisher, South Sioux City Community Schools

12. Dean Folkers, Nebraska Department of Education

13. Susan Fritz, University of Nebraska Administration

14. Ivan Gilreath, Boys & Girls Club of Omaha

15. Travis Haggard, City of Ogallala

16. Kevin Halle, Wayne State

17. Jon Hansen, Chadron State

18. Senator Burke Harr, Nebraska Legislature

19. Matt Hastings, Nebraska Department of Education

20. Tom Henning, Cash-Wa Distributing

21. Dr. Anne Herman, United Way of the Midlands

22. Brenda Hicks-Sorenson, Former Nebraska Department of Economic Development

23. President Todd Holcomb, Western Nebraska Community College

24. President Paul Illich, Southeast Community College

25. Cindy Johnson, Grand Island Chamber of Commerce

26. Rich Katt, Nebraska Department of Education

27. Chancellor Doug Kristensen, University of Nebraska Kearney

28. Hod Kosman, Platte Valley Companies

29. Phil Kozera, BioNebraska

30. Joel Lemus, Crete Public Schools

31. Dr. Mike Lucas, York Public Schools

32. Steve Martin, Blue Cross Blue Shield of Nebraska

33. Dirk Peterson, Nucor

34. Rawnda Pierce, Twin Cities Development

35. Pat Pope, NPPD

36. Carolina Quezada, Latino Center of the Midlands

37. TR Raimondo, Behlen Mfg. Co.

38. President Ryan Purdy, Mid-Plains Community College

39. Laura Redoutey, Nebraska Hospital Association

40. Dave Rippe, Hasting Economic Development Corp.

41. Darren Robinson, Buffalo County Economic Development Corp.

42. Dr. Ron Rosati, Nebraska College of Technical Agriculture

43. President Randy Schmailzl, Metropolitan Community College

44. Chuck Schroeder, Rural Futures

45. Eric Seacrest, Mid-Nebraska Community Foundation

46. Mark Shepard, Fremont Public Schools

47. Senator Jim Smith, Nebraska Legislature

48. President Greg Smith, Central Community College

49. Charles Snare, Chadron State

50. Senator Kate Sullivan, Nebraska Legislature

51. Juli Thelen, Behlen Mfg. Co.

52. Randy Thelen, Greater Omaha Chamber

53. Dr. Rob Winter, Grand Island Public Schools

54. Eric Zeece, Nebraska Department of Economic Development

31 © FSG |