Halfway to 2025, Alabama is slightly behind pace to meet its goal of adding 500,000 new skilled workers to its workforce by 2025, according to a new study commissioned by Gov. Kay Ivey’s office.

The results are better than might be expected, considering the circumstances of the past three years. However, sustained effort will be required across multiple fronts to make competitive progress on educational attainment and labor force participation.

The Alabama Workforce Council and Gov. Kay Ivey launched the Success Plus initiative in 2018 amidst a national push to raise education and skill levels. Increasingly, a credential or degree beyond high school is considered essential to thrive in the modern economy. Higher levels of educational attainment for individuals and for the state are linked to higher pay, lower unemployment, and better health outcomes. Alabama trails other states in educational attainment and associated measures like labor force participation.  

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Between 2018-2021, Alabama produced 214,725 newly credentialed individuals between the ages of 16-64, according to estimates developed by the Center for Regional Economic Competitiveness, the Washington, D.C.-based nonprofit hired to analyze the state’s performance.

That includes associate’s and bachelor’s degrees earned at colleges, industry-recognized credentials in high schools, occupational licenses, and completed certification programs and apprenticeships in the adult population as well.

Refining the Goal

Like any thoughtful goal-setting exercise, Success Plus has refined its measures and goals. The original focus on the adult population (ages 25-64) has been broadened to include credential earners 16-24, recognizing that age group as the supply line for the future workforce and those most active in credential-earning.

Leaders of the initiative are also opting to focus on the numerical goal of 500,000 individuals rather than achieving a 60% rate of postsecondary credential attainment. A rate is more abstract and harder to measure. Beyond that, reaching the national average rate for educational attainment and labor force participation are important long-term goals but aren’t realistically attainable by 2025.

Refining the Count

To generate the counts and estimates, CREC worked across several information sources. Those estimates have limitations since they are based at least in part on aggregated data:

• The data include reports from private for-profit and nonprofit schools and training agencies, some of which operate online distance education. Thus, some of the credentials reported by institutions with an Alabama presence may be earned by someone who lives elsewhere and won’t become part of the Alabama workforce.
• The estimates can’t control for the quality of the credential earned.
• Out-of-state students at Alabama public colleges earned about 40,000 of the 180,000 certificates and degrees included in the tally. Currently, only a small percentage of those students stay in Alabama.

Fortunately, a more precise count will eventually be available. The Success Plus initiative has spurred Alabama to build a privacy-protected system for tracking education, degree and credential attainment, and entry into the workforce, something most other states have already done.

That system is still developing, but its construction has already encouraged better data collection, standardization, and sharing across state agencies. That’s long been a need to generate timely insights on labor force and education supply and demand.

Success Plus is also building tools to sharpen the focus on quality credentials by building more direct routes through education to employment. The initiative brings together employers, educators, and outside experts to identify jobs that are in demand and the education and training needed to compete for those jobs successfully. As those pathways from education to employment become more clear, students should be able to plot a more efficient course to the career they want. And employers will be able to more efficiently identify individuals with the qualifications needed for positions.

Success Plus has identified those out-of-state students as an opportunity as well. A 2020 study by the Alabama Commission on Higher Education found that only 14% of bachelor’s degree earners who came from out-of-state were employed in Alabama five years after graduating. Alabama natives graduate and leave the state as well. The same study found that 62% of in-state bachelor’s earners remained in the state five years after graduation. Success Plus has energized efforts to retain those graduates as residents and workers.

Building momentum

Halfway to 2025, the number of career technical education credentials earned in high schools has risen, as has high school/college dual enrollment.

Another notable development spurred on by the Success Plus Initiative was the founding of the Alabama Office of Apprenticeship (AOA). In an apprenticeship, a new employee is paid while training and working for an employer or a profession. Apprenticeships often involve cooperation between an employer, a training provider, and the state, which encourages and helps subsidize paid training programs. Established in Sept. 2019, the AOA currently works with 427 employers, supporting 2,797 apprentices across the state.

Interactive Map of Apprenticeship Programs in Alabama

Needs Attention

The college-going rate for high school graduates has declined for several years and dropped sharply during the pandemic. Part of the reason for the long-term drop is the rise in the high school graduation rate, which had hovered in the 70s but now tops 90%. The numbers suggest that additional students are graduating from high school but lack the academic qualifications for college. It becomes all the more critical for those students to leave high school with a career-related credential or a pathway into training or employment.

Another factor in the drop was the pandemic, which hit two-year colleges particularly hard. Current enrollment suggests a rebound at those schools. The students who delayed starting college during the pandemic represent a target pool of prospects for recruitment to training or education programs.

For those that didn’t finish high school or have left the workforce, there are education and training programs available, but they are underutilized. Nick Moore, who heads the Governor’s Office of Education and Workforce Training, pointed out that Alabama received almost $50 million in Workforce Innovation and Opportunity Act (WIOA) funding in 2020 but only reached 8,000 participants. Less than half of those participants earned a credential through the program, and even fewer ended up in employment related to the training.

If Alabama is going to reach its attainment goals, agency partners will need to recruit more individuals into training that leads to in-demand jobs. Government agencies and nonprofit partners will need to collaborate around participating individuals. Partners can increase success rates by identifying and removing barriers that prevent participants from successfully rejoining the workforce.

Conclusion

Assuming sustained and sincere commitment, Success Plus could mark a turning point for Alabama by:

1. Bringing together a powerful array of interests and actors around a central goal, one that can only be achieved through action on multiple fronts.
2. Committing the state to systematically gathering, reporting on, and acting on data to determine what’s working and where there are problems in the education and workforce pipeline.
3. Prioritizing those who historically have been left behind: special populations that face barriers to educational attainment and participation in the workforce.

PARCA, in partnership with the Business Education Alliance and A+ Education Partnership, has tracked the progress of Success Plus since the initial goal was announced. The most recent report in the series, Forging Alabama’s Future, describes Success Plus and related initiatives and goals set by various partners.

With elections for governor and legislature pending in the fall, Alabamians are united in support for public investment in education and healthcare, divided on how to raise money for new investments, and express a preference for local leadership and decision-making. That is according to PARCA’s annual public opinion survey.

The poll of over 400 Alabama residents was conducted by Dr. Randolph Horn, Samford University, Assistant Vice President for Enrollment Research and Professor of Political Science. 

Results from this year’s survey are consistent with previous years’ results in some important ways.

• Alabamians continue to rank education as the most important state government activity.
  

• Large majorities of Alabamians say the state spends too little on education and healthcare.
  

• Alabamians have an aversion to taxes but say upper-income residents pay too little.
  

• A slim majority say budget surpluses should be reinvested in state services, specifically education, rather than used to cut taxes.
  

• If budget surpluses are used to cut taxes, the most popular tax cut is the sales tax on groceries.
  

• Alabamians are willing to pay more taxes to support education but do not agree on which taxes should be increased.
  

• Alabamians are essentially split on tax-funded vouchers to pay for private school tuition. However, a majority believe vouchers, if allowed, should be available to all students.
  

• Alabamians continue to believe that they have no say in state government and that government officials in Montgomery do not care about their opinions.

Results of the survey indicate many opportunities for officials to demonstrate responsiveness to public concerns and leadership in crafting public policy solutions.

Download the full report here.

With graduation season now upon us, new data allows us to look back at statistics for last May’s public high school graduates, Alabama’s Class of 2021.

In 2021, 92% of seniors graduated on-time four years after starting in 9th grade, maintaining the high rates Alabama public schools have posted in recent years. However, only 76% of seniors were certified as college and career-ready (CCR), a gap that state leaders are calling on schools to close.

Percentage Change in the College and Career Readiness Measures

The results of 2021 should be considered in the context of the Covid-19 Pandemic. This graduating class saw in-person instruction end in March of their junior year. For their senior year, the 2020-2021 school year, the amount of time students spent in-person at school varied by district. While the graduation rate remains close to its historical high point, the college and career readiness rate remains below the level it reached in 2019. That’s not necessarily a bad thing. Measures of college and career readiness must be honest and meaningful measures. There are seven ways a student can demonstrate college and career readiness.

1. Earn Credit Through a College: a higher percentage of students earned college credit while in high school in 2021: 17%. That’s the highest percentage ever, up from 15% in 2020. These courses, also known as dual enrollment, tend to be taken through a local community college but can also be through a university. The student must successfully complete the course and earn credit to qualify as CCR.

2. Earn a Qualifying Score through Advanced Placement: AP courses are taught in a high school but have the rigor and approach of college courses. In 2021, 12% of students qualified as CCR through AP, which is tied for the highest percentage ever. To count as CCR, a student has to score three or higher (out of 5) on the national end-of-course test, a level at which a college might award college credit.

3. Earn an Industry Recognized Credential through Career Technical Education: 36% of students earned an industry-recognized credential through career technical education in 2021. These credentials result from taking work-oriented courses offered at high schools or K-12 career tech centers. At 36%, the Class of 2021 was only slightly behind the 37% of students recorded for the Class of 2019. After a rapid jump in CCR attainment in recent years, there has been an increased focus on the quality of the industry credentials that count toward career readiness. The credential has to be tied to a student’s course of study. Also, the credential should be valued in a career field that is in demand in the regional job market. This screening for the quality of the credential may hold down growth in numbers in the short term, but it should improve value for the student and the economy.

4. Earn a benchmark score in a subject test on the ACT: The percentage of students scoring at or above the college-ready benchmark on the ACT was down by 5% in 2021, to 45%. A student scoring above the benchmark has a 50% chance of earning a B or above and a 75% chance of making a C or above in that course in college. Covid disruptions may have had some bearing on students’ ability to prepare for and take the ACT, which tests readiness for success in college.

5. Earn a qualifying score on WorkKeys: Over the past two years, there has been a significant drop in the number and percentage of students earning CCR through ACT’s WorkKeys test, a standardized test designed to measure whether students have the math and communication skills expected in workplaces. WorkKeys is no longer required, and, in many systems, students who have already demonstrated college and career readiness by another means opt-out. (More on WorkKeys results below)

A lower percentage of students gained admission to the military or earned college credit through an International Baccalaureate course, options six and seven, in 2021 than in previous years.

Numerical Change

While the graduation and CCR rates are stable, fewer students are progressing through Alabama public schools. The rising generation, Generation Z, is smaller than the previous generation, The Millenials. Consequently, the number of college and career-ready high school graduates is declining. Despite little or no change in the graduation or CCR rate, 1,336 fewer students graduated from Alabama public schools and 646 fewer students graduated ready for college and career. In light of the ongoing elevated demand for skilled workers, Alabama must focus on graduating every student with the skills needed to succeed in higher education and/or the workplace.

School and System Results

One system, Piedmont, and two dozen high schools reported a 100% on-time graduation rate for the Class of 2021. Eight high schools reported both 100% graduation and 100% CCR rate. In some schools, a higher percentage of seniors demonstrated college and career readiness than graduated.

On the other hand, nine schools had graduation rates below 75%. Thirty high schools had CCR rates below 50%. Twenty-six school systems had a gap greater than 25% between their graduation rate and the college and career readiness rate. In those systems, more than a quarter of students receiving diplomas hadn’t demonstrated their readiness for college or work, despite having met Alabama’s requirements for obtaining a high school diploma.

In the visualizations below, school systems and schools can be sorted by either graduation rate or college and career readiness rate. The solid colored horizontal bar represents the graduation rate; the short vertical bar represents the CCR rate. Through the tabs above the visualization, other data is accessible, including a graph of the gap between the graduation and CCR rate by system.

The same set of sortable data is available by school. In order to protect student privacy, results for small subpopulations of students are not presented.

Gaps Between Subgroups

Historically, there have been gaps in the high school graduation rate between students of different races. In recent years, those gaps have been largely eliminated. However, the gaps persist in college and career readiness rates. Black and Hispanic CCR rates trail those of whites and Asians. CCR rates for economically disadvantaged students are well-behind those of non-economically disadvantaged students. Examining the subcomponents of CCR, the gap is widest on the ACT, with only 24% of Blacks and 30% of Hispanics benchmarking in a subject on the ACT, compared to 55% of whites. Asians are much further ahead, with 77% of Asian students earning a benchmark score. By contrast, there is almost no racial gap in college and career readiness rates in career technical education: 35% of Black students earned an industry-recognized credential through CTE compared to 36% of whites and 38% of Hispanics.

WorkKeys

While still valued by many school systems, students, and employers, ACT’s WorkKeys test is no longer a universal comparative tool. After 2018, the Alabama Department of Education stopped requiring the test to be given to all students. That has led to significant drops in the number and percentage of students taking WorkKeys. In 2018, over 50,000 students took the test; in 2021, fewer than 35,000.

WorkKeys tests math, reading, and graphical literacy skills as they are employed in the workplace, in contrast to ACT, which tests for knowledge and skills needed in a college classroom. Businesses who build WorkKeys into their hiring practices know what a WorkKeys score means. They have determined what level of proficiency, as measured by WorkKeys, is needed in particular jobs. Students earn either a platinum, gold, silver, or bronze National Career Readiness Certificate, depending on their test performance. A student scoring Silver or above is considered college and career ready. In a normal job market, employers, particularly industrial employers, use WorkKeys in the applicant screening process.

In 2021, 59% of Alabama high school students who took WorkKeys scored Silver or above, indicating they had the foundational math and communication skills needed in most workplaces. That’s down from 66% when all students were required to take the test. Many school systems now make WorkKeys available to students who haven’t qualified as CCR on another measure.

The visualizations that follow present WorkKeys results statewide and in systems where more than 90% of seniors took the test. The percentage of students scoring Workforce ready are those that score Silver or above.

The visualization below presents the results in a more detailed fashion. Each color represents the percentage of tested students scoring at each level: platinum, gold, silver, bronze, and no certificate earned.

The average ACT score for students graduating from Alabama’s public high schools in 2021 was down only slightly, while the national average score fell more steeply, a fact that could be considered a victory in the light of the challenges faced by students and educators during the pandemic. Still, Alabama’s 2021 ACT results continue a downward drift from their peak in 2017.

Alabama’s average score, 18.6 on a 36-point scale, shouldn’t be directly compared to the national average score. Alabama tests virtually all its public high school students, while only 35% of students take the ACT nationally. In states where the test is not universally given, only students planning to go to college take the test, which tends to push up the score. The national average score fell from 20.6 in 2020 to 20.3 in 2021. Among states that tested 100% of students, Alabama maintained its relative performance rank, behind Kentucky, Tennessee, and Arkansas but ahead of Mississippi and Louisiana.

Downward pressure on scores was expected. The pandemic led to the cancellation of several administrations of the ACT. Schools across the country operated virtually during the spring of 2020 when the students in the class of 2021 were juniors. Altered forms of schooling persisted into the fall of 2020. In normal circumstances, some students take the test more than once, attempting to boost their scores. That happened less with the Class of 2021. According to ACT, only 32% of students took the ACT more than once compared to 41% of the 2020 cohort. That drop was likely because most universities suspended the requirement of taking the ACT due to the disruptions.

In addition to the fractional drop in the average scale score for Alabama students, the percentage of students scoring college-ready in all subjects declined. In 2021, only 15% of students scored at or above the college-ready benchmark in all four tested subjects, compared to 16.3% in 2020 and 18% in 2017. According to ACT, students who meet a benchmark on the ACT have approximately a 50% chance of earning a B or better and approximately a 75% chance of making a C or better in a corresponding college course. ACT is primarily geared toward measuring readiness at four-year colleges and universities.

On each of the four subjects that ACT tests — English, math, reading, and science — student scores ticked down a fraction.

Some points of interest arise when delving more deeply into the numbers. Scores for white students declined in every subject while Black students held steady in reading and science. Hispanic students posted an improvement in English and science. Scores rose for both economically distressed and non-economically distressed students, an unexpected result considering that scores overall were down slightly. That may be explained by more students being classified as economically distressed due to the lingering economic consequences of the pandemic. Some students who had typically been in the non-economically distressed category likely shifted into the economically distressed pool, which can push up the scores of the economically distressed pool.

The stubborn score gaps between economic and demographic subpopulations persisted in 2021. Asians outperformed all other subgroups.

Due to the score gaps between students from different backgrounds, the demographic composition of the student body should be taken into account when evaluating a school or system’s performance. The scatterplot presents score performance in the context of the economic composition of the school system’s students.

Systems with a high percentage of non-poverty students are on the right of the scale, while schools with high poverty percentages are on the left. The higher the average scale score for the system, the higher the system appears on the graph. The line of prediction plots the expected performance level for a system considering the economic composition of the student body. Scores increase as the percentage of non-economically distressed students increase. Systems are grouped along that line of prediction, indicating a correlation between the average scale score in the system and the economic makeup.

Systems above the prediction line have outscored expectations based on economics.

A similar pattern can be seen in the array of individual high schools. However, there is more variation from the average. Taken together, the graphs tell us that the socioeconomic composition of a school influences the average score, but that systems and, to an even greater degree, individual schools do make a difference in student performance.

Bearing that in mind, PARCA’s visualizations of the 2021 ACT results allow the viewer to explore how their local schools and systems performed relative to others. Viewers can choose schools and systems that provide appropriate peer comparisons. In addition to comparisons by average scale score, additional views offer results by the percentage of students achieving the benchmarks in each subject. Lower poverty systems serving suburban communities tend to show the best results at the system level.

At the school level, the highest average performance is found not just among those suburban systems but also in magnet high schools in larger systems, like Montgomery County’s Loveless Academic Magnet Program (LAMP) and Huntsville’s New Century Technology High School.

To put ACT scores in perspective, it is helpful to know the typical ACT scores for students entering college. Average scores range widely between colleges and within colleges. In Alabama, the mid-point ACT score for entering students ranges from 28 at the University of Alabama in Huntsville and Auburn University to 17 at Alabama A&M in Huntsville and Alabama State in Montgomery. As part of their mission, these historically-Black universities provide opportunity and access to students who may not have received the same level of college preparation. Many colleges have continued to waive the ACT requirement for admission and are instead relying on high school grades and other factors to assess student readiness. However, ACT scores can still play a role in admissions and in the competition for scholarships.

New estimates released by the U.S. Census Bureau show that more than half of Alabama counties lost population between July 1, 2020, and July 1, 2021, losses driven by an aging population, a declining birthrate, and an elevated death rate during the Covid-19 pandemic.

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Statewide, the 65,868 deaths outnumbered 56,320 births, leading to a net loss through natural change of 8,548. In the visualization below, counties are shaded by their rate of natural change. Only eight counties, those in blue, saw more births than deaths. Alabama had the 4th highest death rate in the U.S., behind West Virginia, Mississippi, and Maine.

However, stronger growth through domestic migration (individuals moving from other states to Alabama, but excluding movers who are foreign-born) helped the state offset those losses. Estimates issued earlier this year put Alabama’s population at 5,039,877, up by about 15,000 or 0.3%, from 2020. A net total of 22,136 domestic migrants moved to Alabama, offsetting the loss from natural change.

Two counties accounted for about half that growth, with coastal Baldwin adding 6,780 net new residents through migration and Madison County adding 5,335. Madison County’s neighbor, Limestone, added 3,388. Other north Alabama counties like Cullman, Lauderdale, Jackson, Morgan, Marshall, and Dekalb also saw gains from domestic migration. The counties containing the three other large population centers — Jefferson, Mobile, and Montgomery — saw population declines, according to the estimates. Meanwhile, counties linked to those metro core counties — counties like Shelby and St. Clair, Elmore and Lee, and Baldwin — saw growth. Modest growth also occurred in some Wiregrass counties — Coffee, Houston, and Henry.

Zooming out to look at the Southeast, similar patterns are evident. Core counties in Atlanta, Charlotte, Nashville, and Memphis lost population while surrounding metro counties grew. Generally, growth was more widespread in Tennessee, Florida, the Carolinas, and the northern half of Georgia. Overall, Alabama counties bordering Georgia, Tennessee, and Florida are growing. Coastal counties on the Southeast’s East and Gulf coasts have seen growth. Counties along the interstates benefit throughout the region. Still, rural counties and whole swaths of the interior South, including counties in central and western Alabama, continue to lose population, not yet connected to the regional engines of growth.

When it comes to counties grouped into metropolitan statistical areas (MSAs), The Daphne-Fairhope-Foley, Huntsville, and Auburn-Opelika MSAs continue to show strong population growth. Among the 358 U.S. metros, they rank No. 16, 40, 50, respectively, in terms of percentage population change.

On the other hand, metro Birmingham is still not seeing the pace of growth of other Southeastern metros. Gains in Shelby, St. Clair, Bibb, and Blount counties weren’t enough to overcome Jefferson County’s estimated population loss of 5,521. Over the past decade, Jefferson County’s natural increase plus population gains from international immigration offset a steady stream of domestic outmigration. But in 2021, deaths outnumbered births by 438, and international migration accounted for a gain of only 153 people. Meanwhile, the estimates show a net loss of 5,238 domestic residents moving out of Jefferson. That produced a net population loss for the MSA in 2021. The Birmingham-Hoover metropolitan statistical area ranked 258 out of 358 U.S. metros in percentage change.

Montgomery ranked No. 248, with a slight population gain, and the Mobile MSA ranked No. 305, with a population loss of 1,326. After strong growth over the past decade, Tuscaloosa County and its metro area lost population in 2021, according to the estimate. Its growth rank ranked it No. 284 among U.S. metros.

The Auburn-Opelika MSA added 2,617 residents, according to the estimates, a growth rate of 1.5%. Dothan, Decatur, and the Florence-Muscle Shoals MSAs also showed positive growth. The Anniston and Gadsden MSAs continued to post slight declines.

Using the menus and tabs in the visualizations above, you can explore birth and death rates, numerical and percentage change of counties and MSAs in Alabama and across the U.S. The state population estimates and components of change released earlier this year are below.

And the final visualization looks back to the results of the 2020 Census and compares population counts from April 2020 and April 2010.

PARCA’s Annual Forum on March 11, 2022, focused on efforts to improve math and reading education instruction for students in Alabama and Mississippi. The program featured the Superintendents of Education for Alabama and Mississippi, with Alabama Gov. Kay Ivey delivering the keynote address.

Reading and Math in Alabama: The Data

Video of Opening Session

Presentation by Ryan Hankins PARCA Executive Director

Literacy: Our Path Forward

Video of literacy presentation and panel

Presentation by Cassandra Wheeler, Voyager Sopris/Lexia Learning and Laura Woolf, Voyager Sopris/Lexia

What About Math?

Video of the Mathematics presentation and panel

Presentation by Steve Leinwand, American Institutes for Research

Why School Mathematics in the 21^st Century is Different — an explanation of why mathematics education needs to change.

A Vision of Effective Teaching and Learning of Mathematics — A description of what math education should be and how to bring it about.

Bridging for Math Strength — Online bank of math education resources for teachers and leads developed by the Virginia Department of Education and George Mason University.

Bed Time Math — free resource for parents offering ideas on how to incorporate math into everyday interactions with children.

Superintendents’ Conversation

Video of discussion between Dr. Eric Mackey, Alabama State Superintendent of Education, and Dr. Carey Wright, Mississippi State Superintendent of Education

Albert P. Brewer Legacy Lunch

Kay Ivey, Governor of Alabama

Video of introductory remarks and governor’s address

Additional Background Material

Literacy

Mississippi Resources

Mississippi’s Literacy-Based Promotion Act: An Inside Look, a study of Mississippi’s Literacy-Based Promotion Act (LBPA) with input from the Mississippi Department of Education and teachers around the state. A study by The Foundation for Excellence in Education (ExcelinEd).

Strong Readers, Strong Leaders, a bank of grade-level-appropriate resources developed for parents and community leaders to help teach children to read. Part of a public awareness campaign to promote reading.

Alabama Reading Initiative

Annual Report, Dec. 2021

ARI Website

Alabama Literacy Act Implementation Guide

The Alabama Family Guide for Student Reading Success

Math

Alabama Math Science and Technology Initiative

Annual Report, December 2021

AMSTI Research and Reports

Family Guide for ACAP Success: Elementary School Math

Additional Education-related Resources

The Alabama Education Lab by al.com, and its weekly newsletter, Ed Chat.

Forging Alabama’s Future: Improving Educational Attainment and Workforce Development, Business Education Alliance report on strategic investments to improve educational attainment and workforce quality and supply.

The Alabama Literacy Alliance, a network of literacy advocacy organizations and service providers from across the state.

A+ Education Partnership, latest news from the educational improvement advocacy group.

The recovery from the pandemic presents an opportunity for Alabama to regain momentum by investing in proven strategies for improving reading, math, and college & career readiness argues a new report commissioned by the Business Education Alliance, a non-profit formed to unite business and education around shared priorities. The Public Affairs Research Council conducted research for the report, Forging Alabama’s Future: Improving Educational Attainment and Workforce Development.

“Alabama must do more to help students prepare for success after high school graduation,” said former State Superintendent Joe Morton, the chairman and president of the Business Education Alliance of Alabama.”

The pandemic led to a drop in college-going and a slowdown in the number of students graduating with career-ready credentials. Alabama has set a goal of raising levels of educational attainment since higher levels of educational attainment lead to higher earnings and higher rates of workforce participation.

Despite low unemployment and high demand for workers, the percentage of Alabama’s population working lags behind other states. “If the state’s labor participation rates were on par with the national average,” Morton said, “not only would more Alabamians be working, but wages would be increasing, poverty would be going down, and businesses currently struggling to find help would be more likely to have the support needed to thrive. But, to meet this target, Alabama must work harder and smarter than our neighboring states.”

The report describes the mutually reinforcing goals and strategies set by the governor, the state Department of Education, and the Alabama Workforce Council. Those goals include reaching the national average on the National Assessment of Educational Progress (NAEP) in both reading and math by 2026. Alabama’s strategies for meeting those goals will be the focus of PARCA’s Annual Forum, March 11, 2022. The program features national and state experts, Alabama Superintendent Eric Mackey, Mississippi’s Superintendent Carey Wright, and Gov. Kay Ivey.

“PARCA believes that setting goals, implementing and sustaining research-based strategies, and assessing progress toward those goals is the pathway to improvement,” said Ryan Hankins, the executive director of the Public Affairs Research Council of Alabama. “Our students and teachers succeed when we set high expectations and sustain the resources necessary to achieve them. The interdependent initiatives described in this report will require patience, commitment, and the courage to change. But we’ll all benefit from their success.”       

Despite the disruptions of the pandemic, Alabama high school graduates who entered college in 2020 were less likely to be assigned to remedial education and thus should be in a better position to succeed in college. The new figures released by the Alabama Commission on Higher Education (ACHE) show a continued decline in the number and percentage of students taking remedial classes in their first year, particularly among those entering community college.

Some of the declines might be attributable to fewer students going to college after high school. Only 54% of the Class of 2020 went on to college in the year after graduating high school, down from college-going rates above 60% in recent history. However, because the remediation rate among those who went to college was down and the decline in rate was concentrated at community colleges, the numbers indicate that the new approach to remedial education instituted by the two-year college system is working.

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Remedial classes are non-credit college courses covering material students should have learned in high school. A student taking a remedial class is paying for a course that won’t count toward a degree. Low-income students can use Pell grants to help pay for the courses, but that can also lead to an exhaustion of Pell eligibility before degree completion. That extra cost and delay in progress are known to lower completion rates for students assigned to remedial education. High schools have been urged to improve preparation for college-bound students, which may account for some of the improvement over time. Still, since much of the drop has been in community colleges, the success in recent years points toward innovations in policy at the two-year schools.

Community Colleges Providing Alternatives

Alabama’s Community College System (ACCS) alternative to remediation has not only decreased the number of students being placed in remedial courses, but the colleges have also seen a rise in passage rates in their college-level math and English classes.

In 2018, The Alabama Community College System (ACCS) made system-wide changes designed to reduce the number of students enrolled in remedial courses (also known as developmental courses). Students were still assessed for their levels of academic preparation upon enrollment, but instead of being assigned to either regular or remedial courses, the system created other options. Students who needed extra support could be placed in a tutorial course alongside college-level math or English. Since the change, the number of students in remedial classes has declined, but the percentage of students passing gateway English and math has increased.

Meanwhile, the number of students assigned to remedial courses at four-year colleges has increased modestly. For years, the bulk of remedial education took place in the community college system. Now the number of students taking remedial classes is about equally divided between two and four-year schools. More students are assigned to remediation in math than in English, though the gap has narrowed as both rates have declined.

The report data from ACHE provides feedback to high schools about how prepared their graduates are. Use the tabs and arrows in the visualization to explore the data. Compare the performance of graduates from your local high school or system to other systems or schools.

This remediation data is the final dataset that looks back on students who graduated in the Spring of 2020. For that school year, PARCA previously published analyses of performance on ACT and WorkKeys, graduation and college and career readiness, and on college-going.

Progress Toward an Educational Goal

Decreasing the number of Alabama public high school graduates needing remediation in college was a goal identified in Alabama’s strategic plan for education, Plan 2020, adopted in 2012.

Remedial education is considered a waste of money for both the state and the individuals paying for higher education. Remedial courses cover material that should be learned in high school. Remedial classes cost students tuition and fees but do not produce credits that count toward graduation. By avoiding remedial courses, students can complete college work more quickly and at less cost.

Are entering college students better prepared?

Since 2012, Alabama has pursued multiple strategies to improve K-12 education and produce high school graduates better prepared for college and careers.

Most directly tied to college preparation, the state has increased support for dual enrollment, which allows high school students to take courses at colleges, and for Advanced Placement courses, college-level courses taught by high school faculty members.

Despite those efforts, scores for Alabama high school graduates on the ACT, the college-readiness test given to all students, have been flat to slightly declining. And while the number of students assigned to remediation has decreased in the two-year system, as noted, the number of remedial students has risen at four-year colleges.    

Conclusion

Remediation is needed for students enrolling with a major gap in their readiness for college. Given the open admissions policy in the two-year system and for some four-year colleges, remedial courses continue to play a role in higher education. For others who need some help rising to the level of college coursework, it benefits students and schools to provide alternatives to remediation. The most straightforward solution is to improve preparation in high school, and those efforts should continue. The two-year system’s strategy to provide simultaneous tutoring rather than sequential remedial courses appears to benefit students, increasing passing and progression rates. The model ACCS has developed should also be explored for replication at four-year colleges.

The college-going rate for Alabama public high school graduates declined substantially in 2020, reaching a seven-year low, more than 10% below the rate in 2014. A drop was expected considering the Covid-19 pandemic’s disruption to normal operations.

According to new data from the Alabama Commission on Higher Education (ACHE), only 54% of the Class of 2020 entered higher education in the 2020-2021 school year. That compares to 65% in 2014. The data is drawn from the National Student Clearinghouse and tracks college enrollment both in-state and out of state, at two-year and four-year public and private colleges and universities.

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Since 2014, Alabama’s high school graduation rate has climbed rapidly. That’s led to a larger pool of graduates but also a growing share of individuals earning a high school diploma but not continuing on to college. In 2020, 23,369 out of the 50,514 high school graduates, or 46%, were not found to be enrolled in higher education the year following graduation.

Enrollment at four-year colleges and universities held up surprisingly well in 2020: 15,183 Class of 2020 graduates, or 30%, enrolled at a four-year school. That was despite the online classes and pandemic-related restrictions. That was down slightly in numeric terms, 193 students down from the 2019 total. It was down only slightly in percentage terms because the number of high school graduates was down as well.

The real drop came in the Alabama Community College System (ACCS). Only 24% of Alabama’s 2020 high school graduates, or 11,858 students, enrolled at a two-year college. In the recent past, 30% of graduates enrolled at community colleges. In 2018, a highwater mark, over 16,000 new high school graduates enrolled in community college after graduating high school.

The enrollment declines at the community college level have been taking place across the country. It may stem from the fact that a greater share of community college students are from economically disadvantaged households, and in 2020, the climate of economic uncertainty likely kept some from committing to embark on a college education.

Community colleges had already been experiencing lower enrollment numbers in the year preceding the pandemic but for the opposite reason: When the job market is strong, as it was in 2019, more graduates go straight into the workforce. When unemployment is high, enrollment tends to rise at community colleges, but that didn’t happen in 2020. This fall, community college enrollments hint at some recovery. Preliminary fall enrollment for 2021 points to some recovery at community colleges in Alabama, with total enrollment up 5.6% compared to 2020. But that’s still down 7.8% compared to 2019.

ACCS officials said that because high school students didn’t finish the 2020 school year physically present at school, two-year colleges missed a traditional window for recruiting students. Applications for federal financial aid (FAFSA) were down significantly, as well. With students away from school, k-12 counselors and community college representatives were unable to make a final push for completion. The resources the FAFSA process unlocks often are a deciding factor for students as to whether they can afford to attend.

As schools return to more normal operations, it is hoped that a yearlong push for FAFSA completion and a return to traditional models of student engagement and recruitment will increase college enrollment. ACCS is also partnering with the American Institutes for Research (AIR), the Alabama State Department of Education, Alabama Possible, and ACHE on an experiment testing whether text messages can help students enroll and succeed in college. The grant-funded project aims to keep high school seniors from dropping through the cracks in the summer between high school graduation and the fall semester of that year. Participating students will receive text messages reminding them to complete specific tasks related to college admission and course registration. The data will be analyzed to measure the impact of participation.

Importance for Attainment

The post-graduation trajectory of the state’s high school graduates is important. Alabama has set a goal of improving its level of educational attainment. Producing college and career-ready graduates and propelling them into advanced technical training or toward college degrees is a key priority. The labor market is increasingly demanding higher levels of training and education. Higher levels of educational attainment are associated with higher incomes, lower unemployment, better health, and longer life.

See the college-going rate for your local high school or school system, or see college-going rates on an interactive map.

Where High School Graduates Go?

Alabama’s high school graduation rate was 90.6% in 2020, down slightly from the record 92% in 2019. ACHE followed 50,410 high school graduates and found:

• 27,041, 54%, enrolled in higher education
• 15,183, 30%, enrolled in four-year colleges
• 11,858, 24%, enrolled in two-year colleges
• 23,369, 46%, were not found to have enrolled
• 90% of enrollees went to a college in Alabama
• 91% of enrollees went to a public college

College-Going Patterns

• Magnet schools and suburban school systems send higher percentages of students to four-year colleges.
  • Birmingham’s magnet high school, Ramsay, ranked No. 1 in the state with 93% of its graduates going to college in 2020, most to a four-year university. Three Montgomery County magnet high schools ranked in the top 10 for college-going. Suburban high schools like Mountain Brook, Vestavia-Hills, Hewitt-Trussville, Homewood, and Hoover also rank in the top 10.
• Some rural and non-metro counties and systems achieve high college-going rates based on high enrollment in the local community college.
  • Muscle Shoals and Arab ranked in the top 20 for college-going due to the strength of their community college enrollments.
• Rural counties isolated from population centers and urban high schools in high poverty neighborhoods tend to have the lowest college-going rates.

Outliers

While generalizations about performance can be made, some schools are outliers. The chart below compares Alabama high schools’ college-going rate (the vertical axis) with the student body’s poverty rate (the horizontal axis). The higher a school is on the chart, the higher the percentage of students who leave high school and enter college—the farther to the right on the chart, the lower the level of poverty. The slanted line in the middle is the average of the values, which forms a line of prediction. In general, the college-going rate rises as the student body poverty rate gets lower.

However, some schools outperform the level at which they would be predicted to perform based on the economic status of students. In 2020, examples included high schools like Amelia L Johnson High School in Marengo County (94% qualifying for free lunch; 63% of graduates entering higher education), Pickens County High (76% free and 61% in higher education), and Sweetwater High, also in Marengo County, (50% free and 72% entering higher education).

The tabs above the chart allow navigation to a variety of measures of college-going and educational attainment at the school, the system, the county, and the state level. The statistics are presented in graphics, tables, and maps.

By the end of FY 2021, Alabama tax collections had grown at their fastest pace in recent history, fueled by economic recovery from pandemic shutdowns and by unprecedented injections of federal stimulus for governments, businesses, and individuals.

For the fiscal year that ended September 30, both the Education Trust Fund (ETF) and the General Fund grew by more than 11%, compared to historical averages of 3.5-3.7% for the ETF and 2-2.25% for the General Fund. Alabama’s percentage gain in tax revenue since the pandemic crash ranks 7^th among the states, according to an analysis by the Pew Charitable Trusts.  The growth rates far exceed any year since at least 1995.

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However, it is important to remember the growth comes in comparison to FY 2020, a year in which COVID shutdowns constrained growth. During FY 2021 (from October 2020 — September 2021), businesses were open throughout the year, though some were still affected by restrictions related to the virus.

The growth is also taking place in the context of rising inflation, meaning the revenue is based on higher prices, and the money collected won’t have the same purchasing power it previously did. Regardless, the growth was substantial.

The ETF took in $900 million more than in FY 2020, topping $8.6 billion. And that understates the gain. FY 2020’s total included over $300 million borrowed from the Budget Stabilization Fund for cash flow purposes. That money was returned to the fund later in 2020.

The General Fund took in almost $2.6 billion, an increase of $262 million over last year.

Where did the growth come from?

Based on estimates from the Federal Funds Information for States, Alabama budget analysts estimate that $30 billion in federal relief flowed to individuals and businesses in Alabama. In addition, $16 billion in federal relief was authorized and is in the process of flowing through the state out to agencies and local governments.

That extra money in the hands of consumers fueled spending. Gross sales tax collections increased almost 15%, driven by multiple rounds of economic stimulus payments to individuals and parents with children. Spending was also boosted by unemployment benefits, which provided roughly twice the minimum wage. For some laid-off workers, the benefits amounted to a raise. Aid from the paycheck protection program kept businesses solvent and employees on payrolls.

While the bulk of the sales tax is deposited in the ETF, the General Fund also benefited from the increased spending and changed consumer patterns. The Simplified Sellers Use Tax (SSUT), the tax on online sales, rose almost 40% over 2020 totals (and 2020 was 99% higher than 2019). The Legislature’s decision to deposit the bulk of the SSUT into the General Fund added a growth element to the General Fund that had been lacking. Instead of lurching from crisis to crisis, the fund has kept pace with the rising costs.

Gross individual income tax collections were also up, increasing 13%, despite the fact employment levels haven’t reached pre-pandemic highs. By the beginning of FY 2021, employment levels had rebounded to about 60,000 short of March 2020 employment. Since then, they have continued at that level. Meanwhile, wages have been on the rise as businesses seek workers in the face of a shortage of workers.

Surpluses and Temptations

Thanks to the additional revenue, the state covered the 2021 ETF budget and ended with a balance of $1.24 billion, which will be available for lawmakers when the lawmakers convene in 2022.

The General Fund ended with a surplus of $368 million, which has already been put to use, appropriated as part of the funding for new prison construction.

The surge in state tax dollars has come along with a surge in federal support for state government operations as well. In a typical year, federal funds provide almost the same amount the state raises in taxes. But with the pandemic, the U.S. government sent an estimated $17 billion in relief funding to Alabama to schools, hospitals, and other agencies. Some of that is flowing through the appropriation process, but much of it is flowing directly to the agencies, making it difficult to know whether it has been spent yet or not.

The danger comes when those federal relief funds dry up. Growth will taper. State agencies receiving federal relief cannot count on that level of funding to continue. Legislators will convene in 2022, in an election year, with a lot to spend. But they will also have to keep an eye toward an unpredictable future and not commit to unsustainable levels of recurring expenses.

Thus, it’s useful to look for clues in the FY 2021 collections.

General Fund Revenue Sources

A myriad of tax sources supports the General Fund. Traditionally, most of those sources saw little growth from year to year. The General Fund struggled to keep up with rising expenses in non-education expenses, like funding for prisons and the Medicaid program.

However, in recent years, some growth taxes have been added to the General Fund, and its rate of growth has been similar to the Education Trust Fund. Since 2017, General Fund receipts have increased 33%, while ETF receipts have increased 37%.

Big gainers

Insurance Co. Taxes: The largest tax in the General Fund, the tax on insurance premiums, contributed close to $500 million to the General Fund, increasing by $77 million or 19% over 2020 collections. As insurance rates go up, and as more people take out insurance, the tax brings in more. Also, $30 million of the tax had been going to the ETF. That ended with a law change in 2019, increasing the yield to the General Fund.

Simplified Sellers Use Tax: The SSUT continued a string of huge gains as the shift to online sales continued in FY 2021. An additional $55 million came in from this source, an increase of 39% over 2020 (In 2020, the increase was 99%). It has quickly grown into the third-largest source of revenue in the General Fund at $192 million. That represents 75% of the tax. The remaining 25% goes into the ETF. Some of the growth may be attributable to new retailers submitting the tax. Still, this year’s growth is likely attributable to both the increased spending power of consumers because of stimulus and rising wages and to the continuing shift to purchasing online for home delivery. Considering the decreased threat of Covid, the tax is expected to grow more slowly in the future.

Financial Institutions Excise Tax: Coming off a down year in 2020, this tax source jumped by $55 million, an increase of 156%. The big jump is attributable to a new law in 2019 that required banks to make payments quarterly rather than in a lump sum. It also changed how the tax amount due was calculated, bringing it more in line with the federal definition of taxable income. The big surge in collections was not expected, as the law changes were expected to be revenue-neutral. State budget officials think the shift in the schedule for payment of the tax may have resulted in a surge of revenue in FY 2021 will not continue.

Sales and Use Tax: a share of the sales tax on autos and boats is distributed to the General Fund, and each of those lines was up by more than $25 million, thanks to the strong demand and rising prices for both.

ABC Board: Liquor sales continued a rising trend posting a 12% gain over 2020, a year when ABC proceeds climbed by 14%. This may result from a continuing shift toward purchase for home consumption, as restaurant and bar operations continued to be somewhat curtailed in FY 2021. The revenue sent to the General Fund from the ABC sales increased to $157 million.

Mortgage and Deed Record Taxes: About $20 million additional came in through taxes related to home sales. Both prices and activity spike in 2021, reflected in a 34% increase in the mortgage tax, adding $15 million to reach a total of $58 million, and a 45% jump in the deed record tax, reaching $17 million. Continued low-interest rates led to more refinancing and home purchases.

Lodging Tax: This tax on hotels and vacation rentals was up 26% in 2021 after being down 15% in 2020, bringing in an additional $13 million compared to 2020. Gulf Coast rentals saw a record demand though some units were offline because of damage caused by Hurricane Sally in Sept. 2020. Convention and hotel traffic remained depressed compared to historic norms.

Interest on the Alabama Trust Fund: More accurately described as investment returns on the Alabama Trust Fund, the contribution from this source increased 8%, or $8 million, thanks to a strong market. Also known as the State’s savings account, the Alabama Trust Fund is at nearly full strength as amounts borrowed during previous downturns have largely been repaid.

Oil and Gas Production Tax: The oil and gas production tax was up 16%, recovering somewhat from a crash in FY 2020.

Court Costs: With the courts open again, court costs recovered some of the previous year’s drop, though FY 2021 collections were still behind 2019s. In FY 2021, proceeds from court costs contributed $60 million to the General Fund.

Big losers

Cigarette Tax: Though it remains a significant source of revenue, the cigarette tax continues to decline as smoking decreases. The taxes brought in $143 million to the General Fund in FY 2021, down by $5 million, a decline of 3%. Meanwhile, a Tax on Vapor products increased 28%, or $614,875, to $2.8 million.

Interest on State Deposits: The state earns interest on the cash it holds, but this source of revenue declined $31 million or 62% because of dropping interest rates. The state collected about $20 million from this source in 2021.

Mobile Telecom Tax: A dying tax, this tax applied to phone plans that sold talk time. For the most part, cellular plans now provide unlimited talk time at no charge but charge for data, which is not covered by this tax. Revenue continues to decline, bringing in just over $11 million, down another nearly $4 million or 26% lower than last year.

Education Trust Fund

The ETF supports K-12 schools, colleges, and universities. The state’s two largest revenue sources flow into it: the income tax and the sales tax.

Benefiting from growth taxes, the ETF has traditionally seen the most substantial ups and downs: rapid growth in good times and jarring contractions when the economy falters. However, more recently, the Legislature has spread some of the growth taxes and has imposed rules on how fast spending can grow. These restraints have thus far prevented mid-year budget cuts and have allowed the accumulation of reserve funds.

Big Gainers

Income Taxes: Net income tax deposited in the ETF was increased by a jaw-dropping 21%. The anemic growth of income taxes in FY 2020 is part of the story. FY 2021 full-year of full-time employment earnings produced a substantial gain in gross personal income tax collections, up $643 million to a total of $5.8 billion. But even more staggering was a 61% increase in corporate income taxes. Corporate income taxes increased $370 million to a total of $974 million. Explanations for such a large jump are not completely clear. Certainly, the recovering economy had businesses operating a full calendar year. Pent-up demand and the stimulus in the economy drove up sales bolstering income over a down 2020. Budget analysts also speculate that corporations may have realized more revenue in 2021 to avoid potentially higher federal taxes in 2022. After refunds and other adjustments, the income tax contributed $5.6 billion to the ETF, increasing $987 million over 2020.

Sales Taxes: The state received over $2.3 billion in sales tax revenue in 2020, and $325 million more than last year was sent to the General Fund, an 11% increase. Sales were robust at grocery and hardware stores as people continued to invest in home improvements. It’s also important to note that inflation has driven up the prices of some goods, which in turn drives up sales taxes, which are based on the total cost. With the dissipation of stimulus money, this pace of growth is unlikely to recur. But, with the pandemic under better control, activity continues to accelerate, Demand is strong. Unemployment is low, and wages are rising. That suggests income and sales taxes will continue to grow.

Simplified Sellers Use Tax: As in the General Fund, the contribution of this tax was up 40%, adding $18 million to the ETF, for a total contribution to the ETF of $64 million. The proceeds of the tax are divided, with the ETF receiving 25% and the General Fund 75%.

Big losers:

Insurance Premium Tax: Before FY 2021, $30 million from the Insurance Premium Tax was deposited into the Education Trust Fund. That ended because of a 2019 change in the law governing the distribution. The total amount is now in the General Fund.

The Utility Tax: Down 2% or $8 million, this is a tax on electric, water, telephone, and gas utilities. FY 2021 saw both a mild summer and winter and a wet one. That leads to decreased energy consumption and lower levels of water use. However, the extra rain provided more opportunities for hydropower generation, driving up receipts from the hydroelectric tax.

From the Year’s End Looking Forward

Both funds ended FY 2021 with substantial surpluses. FY 2022 budgets were built on the assumption of 3% growth over the 2021 budgets. Current conditions suggest the state should easily exceed those predictions.

Alabama is in an unfamiliar position of having to manage its way through unexpected excess revenue.

General Fund

• FY 21 Budgeted $2,393,272,863
• FY 21 Receipts $2,562,158,281
• FY 22 Budgeted $2,637,874,471

Education Trust Fund

• FY 21 Budgeted $7,217,422,487
• FY 21 Receipts $8,643,813,063
• FY 22 Budgeted $7,672,576,575

And that’s only part of the picture

The ETF and General Fund totals don’t even represent half the revenue that powers public agencies, state schools, universities, and hospitals. Nor does it represent the federal benefits that flow through state agencies like Medicaid, the Departments of Human Resources, Health, Mental Health, Labor, and Rehabilitation Services. The chart below gets closer to a picture of the scale of public spending in Alabama.

Reserve Fund Balances

Current conditions suggest continued recovery, But if things were to falter, Alabama has built up major reserves that are available to tap in case of an economic downturn. A recent analysis on state reserves and rainy day funds by the Pew Charitable Trusts estimated that Alabama $1.1 billion in rainy day funds or 11.2% of spending. The state could run on its rainy day funds for 41 days, Pew estimated. That puts Alabama well ahead of the 50-state median for the strength of its reserves.

• ETF Budget Stabilization: $448,410,575
• ETF Rainy Day: $484,979,764
• ETF Advancement & Technology: $282,314,668
• GF Budget Reserve: $75,303,255
• GF Rainy Day: $263,994,883