SC colleges help out-of-state students, but does it pay off if they leave the state?

Out-of-state senior is heading home after graduation

Benedict College senior Jameer Bailey enjoyed his time in Columbia. But like a lot of out-of-state students, he plans to leave the state after graduation.
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Benedict College senior Jameer Bailey enjoyed his time in Columbia. But like a lot of out-of-state students, he plans to leave the state after graduation.

Jameer Bailey has loved his time in Columbia, studying at Benedict College.

A New Jersey native, Bailey “didn’t want to go to school too close to home.” So, he applied to several historically black colleges and universities in the South. “Benedict sparked my heart. It’s built around family. I came to visit, and it felt like home.”

But when he graduates later this month, Bailey plans to move to Philadelphia and join the City Year program, then pursue a graduate degree, leaving South Carolina behind.

Bailey is not alone, leading some to question why S.C. taxpayers spend money educating out-of-state students.

Of the 13,594 out-of-state graduates produced by S.C. colleges in 2009-10, about half left the state within a year. Only 35 percent still were working in the Palmetto State a year later, according to a study by the S.C. Commission on Higher Education and the state Department of Employment and Workforce.

The study matched information from graduating classes across the state with state filings by S.C. employers to track graduates who stayed in the Palmetto State and those who didn’t.

In recent years, the number of out-of-state students in S.C. schools has skyrocketed. The University of South Carolina’s Columbia campus saw out-of-state students more than double between 2006 and 2015, the fastest growth of any S.C. institution.

S.C. colleges — financed, in part, by taxpayers as part of the state budget and lottery scholarship money — say they need the out-of-state students to make their financial ends meet. The higher tuition rates that out-of-state students pay help offset cuts in state funding of higher education, they say.

But not all those students are paying the colleges’ listed out-of-state tuition rates.

Over the past decade, for example, USC has granted $515 million in tuition breaks to nonresident students. Sixty-one percent of those out-of-state students still pay more than in-state students, helping make the out-of-state students the school’s No. 1 source of revenue, USC says.

However, the tuition breaks have sparked debate over whether the growth in out-of-state students is being subsidized by S.C. taxpayers.

That’s where the recent study of what out-of-state students do after they graduate comes in. In part, the study was an attempt to determine whether those out-of-state graduates stay in South Carolina, as colleges contend, becoming S.C. workers and taxpayers.

More tech school grads stay, but research school grads leave

The study found college graduates who grew up in South Carolina were more likely to stay in the state. Seventy-nine percent were working in state a year after graduation, and 63.5 percent still were on employer records five years later.

“If we just count the number of graduates, we assume they’re available for the local economy,” said Erica Von Nessen, the researcher who compiled the October study.

50% Percent of out-of-state graduates working in S.C. a year after graduation

35% Percentof out-of-state graduates working in S.C. five years after graduation

79.2% Percentof in-state graduates working in S.C. one year after graduation

63.5% Percentof in-state graduates working in S.C. five years after graduation

The research does have some blind spots.

Federal and military jobs are not being reported to the state, nor are independent contractors. Private colleges also don’t keep the same information on students’ home states as public institutions, so Von Nessen lumped any student with missing data into the out-of-state category.

USC spokesman Wes Hickman said the data also is likely to miss other graduates.

Students who go to graduate school, instead of into the workforce, don’t show up. Neither do those in areas like the greater Charlotte metro area, who might live in South Carolina but commute to work in the Tar Heel State.

And Hickman argues more graduates today don’t have traditional jobs. “Millennials are more likely to enter the workforce as entrepreneurs or freelancers in the ‘gig’ economy,” he said.

But Tim Hofferth, chairman of the Commission on Higher Education, worries the growth in out-of-state students is taking away from public schools’ mission to serve Palmetto State students – without getting a boost to the state’s economy.

“Companies want South Carolinians to fill jobs,” he said.

By admitting more and more out-of-state students, Hofferth contends “USC is investing in their (academic) rankings, not the families of South Carolina.”

Some S.C. schools fared better than others in keeping their out-of-state students in the Palmetto State after graduation.

Sixty-eight percent of out-of-state students who attended a technical college still were working in the Palmetto State five years after graduation, versus 73 percent of in-state students.

In part, that’s because “with the types of training you have at a technical school, there’s usually a tighter link between the schools and an employer,” Von Nessen said.

On the other hand, the state’s top research institutions – USC, Clemson and the Medical University of South Carolina – only saw 17 percent of out-of-state students still living in the state after five years, compared with 58.5 percent of in-state residents.

Data from private schools show 41 percent of out-of-state students stay in South Carolina, while 21 percent of nonresidents at other S.C. four-year colleges stayed in state.

‘I might retire here’

USC notes even those out-of-state students who leave the state after graduation contributed millions to the local economy while they were here, patronizing restaurants and retail businesses.

As part of their tuition, out-of-state students also contributed $5.7 million toward scholarships last year, and an estimated $9 million more than locals to help pay off USC’s debts, Hickman said.

Bailey, the Benedict senior, said he hadn’t planned to move out of South Carolina after graduation. He looked into working at Benedict or joining the Richland County Sheriff’s Department, but the City Year opportunity just came up first.

Even after he leaves, Bailey doesn’t want to leave South Carolina behind forever.

“I might retire here,” he said.