One of the key indicators of an education system’s health is the number of students who drop out. A new report by the national Alliance for Excellent Education shows in stark financial terms how dropouts affect a region’s economy.
The report included both national and major metro statistics — it defined the Twin Cities area as the 11-county metro area, plus St. Croix and Pierce counties in Wisconsin. Although there are several ways of calculating the number of dropouts, the report defined dropouts by taking the number of 9th graders in 2004-05 and subtracting them from the 2007-08 graduating class.
If half the dropouts in the class of 2008 in the Twin Cities metro area had graduated, the area would have seen these returns:
- As much as $86 million in combined earnings in the average year compared to their likely earnings without a diploma;
- The ability to spend an additional $57 million and invest an additional $22 million during the average year;
- This additional spending would be enough to support 650 new jobs and increase the gross regional product by as much as $108 million;
- “By the midpoint of their careers, these new graduates would likely purchase homes totaling a value of as much as $256 million more than what they otherwise would have spent without a diploma. In addition, they would likely spend up to an additional $6 million on vehicle purchases each year,” the report stated;
- As a result of increased wages and greater spending, tax revenue would likely grow by as much as $14 million yearly;
- After earning a high school diploma, 68 percent of these dropouts would likely pursue some type of post-secondary education.
It’s important to note that last statistic, because while high school graduates contribute significantly more to a community than dropouts, the same can be said of college graduates to those who end their education at high school.
Minnesota’s economic engine is primed by agriculture, natural resources, tourism and some industry, but our main economic driver is our brain power. When that drops, then the state is in danger of becoming an economic backwater.
For our future, Minnesota must invest in a quality education system that will allow more students to get their high school degree and proceed to some form of higher education. As this report shows, to do less is economic suicide.