Counting the costs of dropouts: A new trend?
Perhaps these reports have been around forever, but it seems to be popular these days to count up the economic costs of students not earning a high school diploma as a way to support a smorgasbord of educational initiatives. I just got an e-mail from the Alliance for Excellent Education this week with the headline "Nation's dropout rate decreases tax revenue," which somewhat states the obvious.
The press release reads:
"Washington, D.C. – If the more than 1.2 million U.S. high school dropouts from the Class of 2007 had earned diplomas along with their classmates, the federal government could have collected an additional $60.72 billion in tax revenue over these students' lifetimes, according to a calculation from the Alliance for Excellent Education. This amount is comparable to the $59.18 billion in discretionary funding that will support the U.S. Department of Education over the fiscal year that began on October 1, 2007.
"Had all of the dropouts from the Class of 2007 received their high school diplomas, they could have contributed enough money in additional tax revenue over the course of their lifetimes to match the amount of discretionary funding that the U.S. Department of Education received for an entire year," said Bob Wise, president of the Alliance for Excellent Education and former governor of West Virginia. "If that isn’t the best example of how education pays for itself, I don’t know what is."
The group's methodology: The number of dropouts was determined by multiplying ninth-grade enrollment data for the 2003–2004 school year (National Center for Educational Statistics 2004) and the high school graduation rate in 2007 (Editorial Projects in Education 2007), which was then multiplied by $48,000—estimated lifetime federal tax liability difference between a high school dropout and a high school graduate (Rouse 2005).
Another report released last year calculated the cost of North Carolina dropouts. And an economic impact analysis of Guilford County Schools released last week put in dollars figures the benefit Guilford County receives from a lower dropout rate.
As a journalist, I often find it difficult to put these reports into true context given all the caveats and the assumptions they make about taxes and educational spending. We know that students are better off in America with a high school diploma. Do these reports really add anything to the discussion? And are we talking real numbers when you project incomes for thousands of students over their lifetimes? Seems like a whole lot can happen in 30 years to make those numbers worthless.
The first report mentioned above makes the assumption that Americans should be contributing more tax revenue to the federal government. It also assumes that those additional tax dollars would be well spent by the government.
Another issue I take with these reports is that they assume Americans fare better with higher incomes (a portion of which ends up in government coffers). Perhaps it's not so much the actual salaries that are most valuable about education (because salaries are extremely relevant) but that it enables the intellectual and interpersonal sophistocation to navigate employment and family and civic life. For example, a corporate executive miserably making $200,000 may find that her true calling is teaching and may be willing to drop to a $40,000 salary. She may contribute less in taxes but be a more fulfilled and healthier human being.
And a high school graduate who has the basic reading, writing and math skills needed to get an entry level job is likely more prepared to navigate the employment world than a non-graduate. Of course, given the outsourcing of not only low-skill, but high-skill jobs, the economic benefits cannot be taken for granted.
What might be more valuable is a study that follows a cohort of graduates and dropouts to compare their incomes, quality of life, need for social services and so forth over a 10-year period. I don't know if such a study exists.
Comments (6)
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This is a good example of letting minor considerations obscure the big picture. Of course not everyone pushes for the highest salary possible. But income is a pretty good indicator of well-being, and the studies you cite about lifetime earnings tend to take this into account, i.e. they factor in the current relationship between education and income. In other words, those studies are much more informative than you give them credit for.
As for your other comments...
Yes, such studies do add something to the debate. It's not because they tell us, for example, that a high drop-out rate is a problem. It's because they quantify the extent of the problem.
And yes, studies have to make assumptions and issue caveats. But the alternative isn't the perfect study, free of all assumptions, because that study doesn't exist. The alternative is no studies.
This is not to say that all such studies and reports are done well. There are reliable studies and not-so-reliable ones. I'd like to think that my recent study was done well:
http://blog.news-record.com/staff/chalkboard/archives/2008/04/gcs_provides_ec.shtml
But your comments appear to condemn ALL studies.
Posted on April 17, 2008 2:57 PM
That link should be:
http://blog.news-record.com/staff/chalkboard/archives/2008/04/gcs_provides_ec.shtml
Posted on April 17, 2008 3:00 PM
Okay, I'm not sure why this blog keeps cutting off the last part of the link. But if anyone's interested, the end of the link is...
...gcs_provides_ec.shtml
Posted on April 17, 2008 3:04 PM
Mr. Brod,
I agree with you that some studies are done better than others. An example of a drop-out related study that received some criticism was the "Dropout Factory" report that included three Guilford County high schools on the list (find a previous post about it here: http://blog.news-record.com/staff/chalkboard/archives/2007/11/smith_dudley_ea.shtml).
I recognize that your study looked at specific costs over a short period of time, with dropout data as a small component, which was much easier to wrap one's head around than the reports that make lifetime estimates.
Again, I think it the public is most served by reports that put into context the type of government spending that occurs on dropouts versus high school/college graduates. I guess I could argue that is the media's job. Sure, many dropouts end up at the Department of Social Services and in jail (although one could question the wisdom of taxpayers spending so much to incarcerate non-violent offenders, such as marijuana users). But the government also spends on social security, Medicare, veterans benefits, research, economic development incentives, and a host of other services that people use.
There is the micro, parochial view that identifies challenges within the educational system itself, and there is the macro, big picture view that asks whether dropouts are the most problemmatic aspect of our society and if that is where taxpayers should focus their attention.
Posted on April 18, 2008 9:51 AM
yes the drop out rate of high schools are high.
The schools budget mainly depends on the high school graduates. but then again its is true that all the high school graduates are going to get ahead in the the work place. But the high school dropp outs not only do damage to them selfs but they damage the budgets of the other high school students wanting toget the proper education.
Posted on May 18, 2008 11:16 PM
yes the drop out rate of high schools are high.
The schools budget mainly depends on the high school graduates. but then again its is true that all the high school graduates are going to get ahead in the the work place. But the high school dropp outs not only do damage to them selfs but they damage the budgets of the other high school students wanting toget the proper education.
Posted on May 18, 2008 11:17 PM