New Report: Economic Benefits of Reducing High School Dropout Rates

Posted by on December 7, 2009

Mapping the economic cost of dropouts

A new analysis by the Alliance for Excellent Education shows that the U.S. economy would grow significantly if the number of high school dropouts were cut in half. Nearly 600,000 students dropped out of the high school class of 2008 in the nation’s 50 largest cities and surrounding areas. The Alliance’s research shows that if just half of these students had graduated, earnings would have been more than $4.1 billion in additional income every year. Annual state and local tax revenues in affected areas would have jumped by nearly $536 million. The study also found that 65 percent of these additional high school graduates would have continued to college, many earning a PhD or other professional degree. Estimates were generated by an economic model based on graduation rates calculated by Editorial Projects in Education. Economic benefits were projected for U.S. Census-defined metropolitan statistical areas (MSAs) consisting of a central urban area and its surrounding geographic area, provided the surrounds had strong social and economic ties to the city. The 4,900 high schools located within these MSAs currently have an average graduation rate of 69.8 percent. Over 900 of these high schools are so-called “dropout factories,” where fewer than 60 percent of freshman progress to their senior year on time.

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