The Alliance for Excellent Education is a Washington, DC-based national policy and advocacy organization that works to improve education policy in America. America pays dearly for its high school dropouts. When young people do not graduate from high school the economic impact is extensive. For the dropout, wages remain significantly lower throughout their lives. The country's overall economy is weakened by their diminished purchasing power. Socially, the consequences are also significant. High school graduates have a much more positive social prognosis—their health is better, they are less likely to commit crimes or utilize government assistance programs, and perhaps most importantly, they are able to raise a healthier and better-educated future generation of children. The cost of high school dropouts is immense and every effort should be made to change current trends. Every school day, nearly 7,000 students become dropouts. Annually, that adds up to about 1.2 million students who will not graduate from high school with their peers as scheduled. Lacking a high school diploma, these individuals will be far more likely than graduates to spend their lives periodically unemployed, on government assistance, or cycling in and out of the prison system. Most high school dropouts see the result of their decision to leave school very clearly in the slimness of their wallets. The average annual income for a high school dropout in 2009 was $19,540, compared to $27,380 for a high school graduate, a difference of $7,840. The impact on the country's economy is less visible, but cumulatively its effect is staggering. Not only do employed high school dropouts earn less than employed high school graduates, high school dropouts are much more likely to be unemployed during economic downturns. If the nation's secondary schools improved sufficiently to graduate all of their students, rather than the 72 percent of students who currently graduate annually, the payoff would be significant. For instance, if the students who dropped out of the Class of 2011 had graduated, the nation's economy would likely benefit from nearly $154 billion in additional income over the course of their lifetimes. Everyone benefits from increased graduation rates. The graduates themselves, 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. An Economic Recession Is More Likely to Impact High School Dropouts Not only do employed high school dropouts earn less than employed high school graduates, high school dropouts are much more likely to be unemployed during economic downturns. Since the economic recession began in December 2007, the national unemployment rate has gone from 5 percent to 9.1 percent in August 2011.... The unemployment rate for individuals of all education levels has skyrocketed since December 2007, but high school dropouts have faced the most difficulty with finding a job. According to data from the U.S. Bureau of Labor Statistics, the unemployment rate for high school dropouts in August 2011—four years after the start of the recession—was 14.3 percent, compared to 9.6 percent for high school graduates, 8.2 percent for individuals with some college credits or an associate's degree, and 4.3 percent for individuals with a bachelor's degree or higher. Higher Levels of Education Translate into Higher Earnings
Recent research conducted by the Alliance for Excellent Education in partnership with Economic Modeling Specialists, Inc., an Idaho-based economic modeling firm, provides a look at the additional earnings an individual would likely expect over the course of his or her lifetime by completing high school. This analysis is based upon state-specific economic data that reflects the postrecession economic reality. Dropouts represent a tremendous loss of human potential and productivity, and they significantly reduce the nation's ability to compete in an increasingly global economy. The calculations ... show the monetary benefits each state would likely accrue over the lifetimes of just one year's worth of dropouts if those students had graduated. Calculations are based on the number of dropouts and average earnings by education level, which causes the numbers to vary from state to state: Vermont (at the low end) would likely see its economy increase by $147 million; Massachusetts (near the middle) would likely add $2 billion to its economy, and California's economy (at the high end) would likely accrue an additional $21 billion over the lifetimes of just one year's worth of dropouts if those students had graduated. These figures are conservative and do not take into account the added economic growth generated from each new dollar put into the economy. All told, these additional earnings from a single high school class would likely pour a total of $154 billion into the national economy. Unless high schools are able to graduate their students at higher rates, nearly 12 million students will likely drop out over the next decade, resulting in a loss to the nation of $1.5 trillion. Society Benefits from an Increase in High School Graduates
Obviously, dropouts are a drain on the nation's economy and the economies of each state. Lower local, state, and national tax revenues are the most obvious consequence of higher dropout rates; even when dropouts are employed, they earn significantly lower wages than do graduates. State and local economies suffer further when they have less-educated populaces, as they find it more difficult to attract new business investment. Simultaneously, these entities must spend more on social programs when their populations have lower educational levels. The nation's economy and competitive standing also suffer when there are high dropout rates. Among developed countries, the United States ranks twenty-first in high school graduation rates and fifteenth in college attainment rates among twenty-five- to thirty-four-year-olds. Dropouts represent a tremendous loss of human potential and productivity, and they significantly reduce the nation's ability to compete in an increasingly global economy. Furthermore, recent estimates project that the future domestic workforce demands will require higher levels of education among U.S. workers. However, without significant improvements in the high school and postsecondary completion rates, the nation is on track to fall short by up to 3 million postsecondary degrees by 2018. The nation can no longer afford to have more than one-quarter of its students leave high school without a diploma. High school graduates, on the other hand, provide both economic and social benefits to society. In addition to earning higher wages—resulting in corresponding benefits to local, state, and national economic conditions—high school graduates live longer, are less likely to be teen parents, and are more likely to raise healthier, better-educated children. In fact, children of parents who graduate from high school are far more likely to graduate from high school, compared to children of parents without high school degrees. High school graduates are also less likely to commit crimes, rely on government health care, or use other public services such as food stamps or housing assistance. Additionally, high school graduates engage in civic activity, including voting and volunteering in their communities, and at higher levels. Improving High Schools Would Help Reduce the Dropout Rate
To increase the number of students who graduate from high school, the nation's secondary schools must address the reasons why most students drop out. In a recent survey of high school dropouts, respondents indicated that they felt alienated at school and that no one noticed if they failed to show up for class. High school dropouts also complained that school did not reflect real-world challenges. More than half of the respondents said that the major reason for dropping out of high school was that they felt their classes were uninteresting and irrelevant. Others leave because they are not doing well academically. According to the 2009 National Assessment of Educational Progress in reading, only about 30 percent of entering high school freshmen read proficiently, which generally means that as the material in their textbooks becomes more challenging, they drop even further behind. The nation can no longer afford to have more than one-quarter of its students leave high school without a diploma. High schools must be improved to give all students the excellent education that will prepare them for college and a career, and to be productive members of society.