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“THE HIGH COST OF HIGH SCHOOL DROPOUTS”: Alliance Pegs Cost of 2008 Dropouts at $319 Billion

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“If candidates running for federal office are truly committed to saving the nation’s economic future, they must commit to saving America’s high schools."
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Had the more than 1.2 million students who dropped out of the Class of 2008 graduated, the nation’s economy would have benefited from an additional $319 billion in income over the course of their lifetimes. So says “The High Cost of High School Dropouts: What the Nation Pays for Inadequate High Schools,” a newly released issue brief from the Alliance for Excellent Education.

“Each class of high school dropouts damages the economy,” said Bob Wise, president of the Alliance for Excellent Education and former governor of West Virginia. “If candidates running for federal office are truly committed to saving the nation’s economic future, they must commit to saving America’s high schools. The best economic stimulus package is to increase the number of students who earn a high school diploma.”

The brief, which is based on research from Diplomas Count and a study by Cecilia Rouse, professor of economics and public affairs at Princeton University, notes that the majority of high school dropouts see the result of their decision to leave school most clearly in the slimness of their wallets. The average annual income for a high school dropout in 2005 was nearly $10,000 less than that of a high school graduate, as indicated in the chart to the right.

According to the brief, dropouts not only earn less income, but they are also far more likely than graduates to spend their lives periodically unemployed, on government assistance, or cycling in and out of the prison system. The brief notes that, by contrast, everyone wins with increased graduation rates. The graduates, on average, will earn higher wages and enjoy more comfortable and secure lifestyles. At the same time, the nation benefits from their increased purchasing power, collects higher tax receipts, and sees higher levels of worker productivity.

Included in the brief is a state-by-state analysis that shows how each class of dropouts can affect a state’s economy. Vermont (at the low end) would see its economy increase by $439 million; Mississippi (near the middle) would add $3.98 billion to its economy, and California’s economy (at the high end) would accrue an additional $42 billion over the lifetime of each graduating class. The brief notes that these figures are conservative and do not account for the added economic growth generated from each new dollar put into the economy.

View the Complete Brief.

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