and course offerings.81 Because community colleges are far more dependent on state funding than four year institutions, the cuts in state funding are particularly challenging.82 Between 2000 and 2010, the average annual community college tuition increased by 41 percent, to $3,269.83 The President’s proposals for federal assistance to the community colleges have run into stiff resistance in the Congress. The fiscal crisis facing community colleges is causing concern in the manufacturing community that depends on the 2-year institutions as “an essential source of skilled workers.”84

LESSONS LEARNED

•   A distinguishing feature of the American innovation ecosystem is that it is driven by a network of superb research universities.

•   This innovation ecosystem is dominated by triadic collaborations involving universities, industry, and government, with institutional arrangements that promote silo-breaking and multidisciplinary research.

•   The decentralization of the U.S. university system lends itself to differentiated state and regional innovation strategies that leverage local geographic, industrial legacies and cultural advantages.

•   U.S. community colleges are an important resource base for creating the high-skills work force needed to sustain an innovation-based economy.

•   The decline in state funding for public research universities and community colleges represents a fundamental threat to the nation’s capacity to create and capture the fruits of innovation.

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81A 2013 report by the nonprofit Public Policy Institute of California indicated that in the wake of $1.5 billion in state budget cuts, between 2007 and 2012 the state’s 112 2-year colleges experienced a decline in enrollment of 500,000 students (from 2.9 million to 2.4 million). Across the system, course offerings dropped by 21 percent. “Budget Cuts Hobble Calif. Community Colleges,” Associated Press March 26, 2013. The same phenomenon is occurring in many other states. “Texas Community Colleges Face Shortfall,” Corpus Christi Caller-Times January 25, 2013; “Community Colleges’ Cash Crunch Threatens Obama’s Retraining Plan,” Reuters March 5, 2013.

82In the 2008-2009 school years, 47 percent of the revenues were derived from state appropriations, compared with 24 percent for public 4 year institutions. U.S. Department of Commerce, The Competitiveness and Innovative Capacity of the United States, January 2012, citing figures from the National Center for Education Statistics, IPEDS, 2010, Table 198.

83“Community Colleges’ Cash Crunch Threatens Obama’s Retraining Plan,” Reuters March 5, 2013.

84Ibid.



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