Report: High school dropouts cost economy billions

Nationally, a 90 percent graduation rate would yield $1.8 billion in local, state, and federal taxes based on $5.3 billion in higher wages, according to the Alliance for Excellent Education.

All told, the group sees a graduation rate at that level producing an additional $6.6 billion in economic growth.

The group reached those tallies by comparing the annual average earnings of a high school dropout against those of a high school graduate in each state and projecting over time. The calculations took into account the share of students who go on to college and projected workers’ tax rates based on training.

None of their projections took into account the additional government costs for those who don’t finish high school, such as law enforcement, unemployment aid, or job training—so the figures might actually be low estimates.

Other groups that helped craft parts of the report included Civic Enterprises, America’s Promise Alliance, and Johns Hopkins University’s School of Education.

While there’s no doubt that students who attain higher education earn more and likely pay more in taxes, the groups’ methods for calculating deserves some scrutiny.

“They tend to take the numbers that they find and then extrapolate them. It’s a very simple way of doing things,” said Henry Levin, the co-director of the Center for Benefit-Cost Studies in Education at Teacher’s College Columbia University.

“You have to be very careful with these,” said Levin, who studies the economics of education. “It’s like saying, if my 3-foot-tall child were 6 feet tall, my child would be able to do all sorts of things. But it doesn’t make any sense to talk that way, because it’s not going to happen right now.”

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The same can be said for suddenly increasingly the graduation rate to 90 percent, he said.

Yet that goal is hardly new; it was first outlined in 1990 by then-President George H.W. Bush.

Since then, three other U.S. presidents have called for that rate. Each, however, pushed back the year the nation should reach that goal.

The latest, President Barack Obama, wants to reach that high school graduation rate by 2020.

“For the first time, the nation is on pace to reach the high school graduation rate by 2020,” said Bridgeland, who was President George W. Bush’s domestic policy adviser. “Over the last decade, the country was inching up from 2001 to 2006, then rocketed forward from 2006 to 2010, creating the pace of progress.”

But it’s not certain.

Students with limited English fluency and those with learning disabilities still face challenges to finishing high school; only a quarter of those groups finish high school in some states. Also, about a third of black students and 29 percent of Hispanics leave high school without earning a diploma, according to the report.

“It’s within the realm of possibility, which is a real accomplishment,” said Robert Balfanz, who studies dropouts at Johns Hopkins University and is co-director of the school’s Everyone Graduates Center.

He cautions, however: “It’s not a done deal by any means.”

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