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High School Graduation Rates and Their Effect on the American Economy

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May 21, 2018 02:33 pm

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How does an individual’s decision to drop out of high school affect the rest of us? And, conversely, how does a student graduating from high school benefit all of us?

Those were the questions the Alliance for Excellent Education (All4Ed) sought to answer when it began working on an economic model that would demonstrate the economic impact of a 90 percent high school graduation rate.

Individuals who drop out of high school are far more likely to spend their lives periodically unemployed, on government assistance, or cycling in and out of the prison system than individuals who earn a high school diploma. But individuals are not the only ones affected when they do not graduate.

To quantify how a student’s decision to drop out affects the rest of us, and, conversely, how a student graduating from high school benefits all of us, the Alliance for Excellent Education (All4Ed) released new data demonstrating the economic impact of reaching a 90 percent high school graduation rate. The data is available for the United States as a whole, all fifty states, and roughly 140 metro areas, from Anchorage, Alaska to Winston-Salem, North Carolina and many places in-between.

During a time when future success is so closely linked to educational outcomes, one in six students do not earn their high school diploma. Individuals who drop out of high school are far more likely to spend their lives periodically unemployed, on government assistance, or cycling in and out of the prison system.

But what if the United States were able to achieve a 90 percent high school graduation rate? How would that benefit the nation?

For the Class of 2015, which had a graduation rate of 83.2 percent, a 90 percent graduation rate would have meant an additional 250,000 students would have walked across the Commencement Day stage.

These graduates would collectively have earned $3.1 billion ANNUALLY in additional income.

That additional income isn’t going under the mattress. It’s being spent in local grocery stores, restaurants, and other businesses, powering national, state, and local economies.

And these new graduates are also contributing more in the form of tax dollars—roughly $664 million collectively by the midpoint of their careers. That tax revenue will go toward public schools, roads, and a variety of other public goods.

In total, the collective spending power of these new graduates will lead to greater opportunities for the nation, including $5.7 billion in economic growth and more than 14,000 new jobs created.

And because high school graduates tend to live more healthy lives than high school dropouts—and because they are more inclined to obtain and have their own health insurance throughout the course of their lives, these new graduates will save the nation $16.1 billion in health care costs.

And remember, these numbers are for just one class of high school graduates. That’s what I call an economic stimulus package!

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Please keep in mind that while All4Ed’s economic model is based on a 90 percent high school graduation rate, simply pushing students through the system to make sure they earn a diploma is not the answer.

The high school diploma that students earn must represent the content knowledge, critical thinking, collaboration, communication and other deeper learning skills necessary for success in college and today’s economy.

Unfortunately, far too many students are graduating without these diplomas.

According to a recent All4Ed report, Paper Thin, there are nearly 100 different types of high school diplomas that are awarded across all fifty states and the District of Columbia, but less than half prepare students for success in college and a career. And while the national high school graduation rate is at an all-time high, the rate at which students earn these college- and career-ready (CCR) diplomas is substantially lower, especially among students from low-income families, students of color, and other historically underserved students.

To explore how high schools can ensure that more students earn CCR diplomas, I joined Lillian M. Lowery, vice president for P–12 policy and practice at The Education Trust, and Gilbert Zavala, vice president of education and talent development at the Austin Chamber of Commerce, in a May 17 webinar.

Lowery, Zavala, and I discussed how to provide a high-quality education to all students and what meeting such a goal would mean for the country—how individual lives would be transformed, communities would be strengthened, and the nation’s economy would be enriched. We also talked about actions that educators, business leaders, community members and others can take to close gaps in opportunity and raise achievement, especially among students of color and other historically underserved students who currently make up more that 50 percent of the nation’s K-12 students.

You can watch archived video from that webinar via the video player embedded below.

For additional solutions, All4Ed has a list of interventions that support high school graduation and college and career readiness at https://all4ed.org/high-school-solutions/. That page provides detailed instructions and actionable recommendations for educators interested in implementing early college high school and dual-enrollment programs; Advanced Placement and International Baccalaureate programs; deeper learning; personalized learning; and career and technical education to list a few.

Bob Wise is president of the Alliance for Excellent Education and former governor of West Virginia.

 

Categories:
Economic Impacts, High School Graduation Rates and Secondary School Improvement

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Every Child a Graduate. Every Child Prepared for Life.