Last Tuesday, Vice President Joe Biden issued a call to boost college graduation rates across the country and meet President Obama's goal of the United States having the highest proportion of college graduates in the world by 2020. A key component of reaching that goal is graduating more students from high school. Every year, more than one million students leave high school without a diploma.
Most individuals understand the importance of furthering their education. Currently, high school dropouts are over three times more likely to be unemployed than are college graduates. Over the course of his or her lifetime a high school dropout earns, on average, about $260,000 less than a high school graduate. However, results from a new study conducted by the Alliance for Excellent Education and funded by State Farm®, demonstrate that individuals are not the only ones who benefit from better educational outcomes -- we all do.
According to the study, cutting the national high school dropout rate in half for the Class of 2010 would mean these "new graduates" would likely earn an additional $7.6 billion in an average year, which translates to an additional $5.6 billion in spending and another $2 billion in investments across the nation. This increased spending and investments would likely lead to 54,000 new jobs and an annual increase in the gross domestic product (GDP) of $9.6 billion. It is important to remember that these numbers represent the value of decreasing the dropout rate for a single high school class, but the cumulative benefits over a longer period of time would be exponentially greater.
If you're a bank branch manager, or new car salesman, or a Realtor, who would you rather see walking into your office? A high school dropout or a high school graduate? A high school dropout probably will not get approval for the loan necessary to finance a new car or home purchase. The research bears this out.
According to the study, cutting the dropout rate in half would mean an additional $19 billion in home purchases and $741 million in automobile purchases. From a business perspective, higher levels of education attainment can lead the way to a greater consumer base as well as a better trained workforce. Whether you have a child enrolled in school or not, you still have a stake in education.
But simply graduating more students isn't enough -- we must work to graduate all students from high school with the skills necessary to succeed in today's economy. Scores from the 2009 Programme for International Student Assessment, or PISA, show that out of 34 countries, the United States ranks 14th in reading and 25th in math.
The U.S. falls far behind the highest-performing countries such as Singapore, Finland, and Canada. Were the United States to boost its performance to Finland's level on the PISA (a 50-point gain), it would likely see a $100 trillion GDP increase over the lifetime of a child born in 2010. If the United States increased scores by just 25 points over the next twenty years -- a manageable goal considering Poland accomplished higher gains in just six years -- the GDP would likely increase by $40 trillion.
As a nation, we should feel a moral obligation to provide an excellent education to our nation's young people, but sometimes it takes hard-hitting numbers to get everyone's attention. These studies indicate that education can be a key economic driver.
To help more students graduate from high school prepared for college and careers, and make these financial projections a reality, the U.S. Congress should pass an updated version of the nation's main education law, the Elementary and Secondary Education Act (ESEA), currently known as No Child Left Behind (NCLB).
NCLB has highlighted achievement gaps and brought improvements in math and reading in the early grades. Unfortunately, those gains have not followed through to middle and high schools. NCLB was groundbreaking in 2001; almost a decade later, it's a compact disc in an iPod world.
An updated ESEA should hold states, districts, and schools accountable for graduating students from high school ready for college and careers instead of requiring students to be "proficient" in basic skills -- a bar that varies in each state and does not necessarily mean a student is well-prepared for success after high school.
When schools, districts, or states fail to reach this goal, it is also important that the new version of the law encourages data-driven improvement where interventions are matched to specific needs and challenges instead of the current one-size-fits-all approach. To make all of these advancements possible, a reauthorized ESEA needs to strengthen the federal funding stream for middle and high schools.
President Obama and U.S. Secretary of Education Arne Duncan have made upgrading the law a priority in 2011 and Democrats and Republicans in Congress have expressed a willingness to work together on the issue. Amongst the budget debates currently occurring on Capitol Hill, education presents an opportunity for bipartisan consensus.
The economic possibilities tied to increasing high school graduation rates are far too great to ignore. More diplomas mean more jobs, greater incomes, more car and home sales, and a higher GDP. That's a stimulus package that will provide for generations to come.