As with the classic question of the chicken or the egg, political leaders, students and educators are scratching their heads over which came first — brain drain or the lack of jobs in Rhode Island.
"Brain drain" refers to the migration of students who, after graduation, leave the state in search of jobs elsewhere. High unemployment is an issue nationally but is particularly acute in Rhode Island, where double-digit jobless rates have been the norm since 2009.
Experts say the state has consistently underfunded public education over the last 20 years, resulting in a population that is not skilled enough to meet the needs of businesses weighing a move to Rhode Island. The state's tax structure and burdensome regulations also discourage business.
But there is potential for growth. Rhode Island's small size makes it a hospitable place for entrepreneurs, and organizations working to boost the state's student retention rates deny the existence of a brain drain at all. Instead, they say, Rhode Island jobs are available if students take the time to look.
By the numbers
Eighty percent of Rhode Island students that attend private colleges and universities leave the state upon graduation, according to Dan Egan, president of the Association of Independent Colleges and Universities of Rhode Island. Eight percent of students that choose to stay after attending a private institution are originally from out-of-state. These numbers came from a two-year survey conducted by Bridge, a program run by Egan's organization that aims to connect institutions of higher education with state businesses.
One-third of all Rhode Island college students stay in the state after graduation. At the Community College of Rhode Island, nearly all graduates remain in the state, said Anne Marie Marge, a staff member at the college's career center. The average age of the college's graduates is 28.
Of the members of CCRI's class of 2009 that sought employment after graduation, nearly 20 percent chose to leave the state. Almost all of the college's students are Rhode Island residents, Marge said.
Out of Brown's class of 2010, 6 percent of graduates said they planned to stay in Providence after graduation, making it the third most popular choice, after New York and Boston. Andrew Simmons, director of the Career Development Center, added that many Brown students staying in Providence were employed by the University to conduct research.
Bad for business
Rhode Island's relative underfunding of public education has resulted in a high proportion of unskilled workers, said Leonard Lardaro, professor of economics at the University of Rhode Island. As a result, companies do not try to hire in Rhode Island, he said.
Rhode Island has the highest unemployment rate in New England and the fourth-highest in the country. Eleven percent of Rhode Islanders were unemployed in March 2011.
"About half of our current unemployed have a high school education or less," Lardaro wrote in an email to The Herald, adding that employers are perennially frustrated because the state's labor force lacks adequate skills to meet their employment needs. Young people up to age 24 have the most difficult time finding jobs due to increased job competition and the decreasing value of a bachelor's degree.
The state has one of the lowest business ratings in the nation, Lardaro said. "When people think of a great place to do business, they never think of Rhode Island," he said. Instead, businesses seeking highly skilled workers go to Massachusetts, he added.
According to national test standards, Rhode Island consistently scores below neighboring New England states. Rhode Island ranked 23rd, while four other New England states scored in the top five, according to a 2009 national standardized test measuring student performance in 4th grade reading,.
According to Anne Marie Marge at CCRI, "soft skills" like teamwork and communication are more important than technical skills in the job search process. "The state really needs to realize how important education is. Every job is going to need good communication skills," she said.
Lardaro said another problem is the state tax structure. Rhode Island's tax rates are high compared to other states, and numerous fees and regulations place an undue burden on businesses. Andy Posner MA'09, co-founder and director of The Capitol Good Fund, said Rhode Island levies a $500 charge — called the "franchise tax — on all businesses, regardless of whether or not the business reports income.
"Going back to the late 1980s, we went after just about any type of revenue from fees we could find," Lardaro wrote in an email to The Herald.
"From all the people I know who graduated last year, I can count the number who stayed in Rhode Island on one hand," said David Coates, student senate president at the University of Rhode Island.
He said corporations are generally "extremely pleased" with the quality of URI graduates, but there are no places for these students to find "quality" jobs in Rhode Island. Many engineers are going abroad, and financiers find work in Connecticut, he said. Others go to Massachusetts for entry-level jobs. But the state's scarcity of nurses means one growing job field in the state is nursing, he added.
Rhode Island has higher-level positions, but not many entry-level jobs, Egan said.
Max Abrahams '11 said he "didn't even bother" actively looking for work in Providence. "Foxborough (Massachusetts) is the only place you can work — the only place with an industry or employment," he said.
"Between a Google job search and Brown Career Services, there was nothing available," he added.
But Kayla Ringelheim '11 found a local job through her undergraduate extracurricular activities. Ringelheim said she will be working with Farm Fresh Rhode Island through a program funded by Americorps VISTA. "It was something I knew I wanted to do because I volunteered with Farm Fresh in my junior and senior years," she said.
"Providence and Rhode Island have a lot to offer that a lot of students don't get to see, because there is so much happening on campus," she said. Ringelheim said staying on campus the summer of her sophomore year showed her there are job opportunities in the state.
But for individuals without a specific connection or interest, jobs in the private sector are a minority, she added.
Entry-level jobs are not abundant in Rhode Island, and the weight of student loans can push students to find higher-paying work out of the state.
Posner said he offered two of his student interns full-time jobs last year, but they turned them down for higher-paying Wall Street jobs.
Rep. Chris Blazejewski, D-Providence and East Providence, has introduced a bill called Opportunity RI that he hopes will confront the state's brain drain problem. The bill "seeks to halt the cycle of students leaving the state" by providing credits that both students and employers can claim for working or hiring in the state, Blazejewski said.
"I think the lack of job opportunities is really the core reason students leave," he said. People go where the jobs are, but also where they can find high-paying jobs to pay back student debt, he added.
A silver lining
While big corporations may not look to Rhode Island to do business, small business owners say there is a growing niche for small businesses and entrepreneurs in the state. Ninety percent of non-government Rhode Island employers have 20 or fewer employees on their payroll, Lardaro said.
Andy Cutler, founding partner of Cutler and Company, moved to Rhode Island from New York and started a communications design consulting firm that has worked with students to jumpstart initiatives like A Better World by Design, a design conference organized by Brown and Rhode Island School of Design students.
Cutler said Rhode Island is a "wonderful pla
ce" to be an entrepreneur. He said the small size of the state gives start-ups an unparalleled opportunity to gain recognition and influence in the community.
Cutler added that the start-up cost here is "tiny," especially in comparison to New York or Boston. "Dollar by dollar, Providence blows away New York City," he said.
Posner said he wanted to stay in Rhode Island after completing his masters at Brown because it is a small state where he can garner the attention of state political leaders in a shorter amount of time than would have been possible in a bigger city.
The brain drain is largely a perception problem, according to Egan.
"We don't believe the brain drain exists," Egan said. "We're a brain gain state."