Texas Dropouts May Hurt the Economy

By: Meghan Wall Email
By: Meghan Wall Email

Reports of increased dropout rates across the country have many people worried about the future of the economy.
Lori Taylor, an economist and Assistant Professor at the Bush School of Government and Public Service says that, in Texas, dropouts are a problem.

Taylor argues that Texas is lagging in education gains in comparison to rest of the nation.
She does not, however, feel that there is substantial proof that drop out rates have increased in Texas.
That is because only recently the Texas Department of Education has adopted a consistent method for counting dropouts.
This more precise method has resulted in the counting of more students and what appears to be an increased dropout rate.
Professor Taylor has a group of students researching the change in dropout levels counted with the new system over the next year.

What is known is that those without a high school diploma make a lot less money than those with a diploma.
In regions with high dropout rates, like Texas, this means less income for workers, less money paid in taxes, and a greater demand for public services.
According to a 2007 report from Texas Public Policy Foundation (TPPF) people without a high school diploma make an average annual salary of $12,699.
That's is $9,000 less than those with a diploma and $35,000 less than individuals with a college degree.
With less income, individuals will contribute less in income, sales, payroll, and property taxes.
Also, dropouts use more public services, such as welfare, Medicaid and unemployment compensation.

The TPPF reported on recent study conducted by the Friedman Foundation, National Center for Policy Analysis, and Hispanic CREO that found some frightening statistics.
The study showed that dropouts decrease tax revenue in Texas by $2 billion a year.
Also, dropouts are two times as likely to go to jail as those who graduate.
And, 35 percent of high school dropouts rely on Medicaid, as compared to 20 percent of those who graduate.
According to the report, "over a lifetime, each class of dropouts costs Texans $19 billion in decreased tax revenues and increased public expenditures."

Another effect of dropouts is less money for Texas schools.
That is because Texas funds its schools on a per student basis.
When a school loses a student it also loses the amount of money allotted to that student.
Dropouts result in fewer enrollments and a decrease in school budgets.

Not all of those without a high school diploma in the state have dropped out of Texas high schools however.
Taylor says that rapidly growing states, like Texas attract all types of workers including those without a high school diploma.
With such a close proximity to Mexico, a large amount of the Texas workforce is that of Mexican immigrants, many without a high school diploma.
According to the 2000 census, two-thirds of adults living in the US who were born in Mexico did not have a high school diploma.
This is especially a problem along the Texas and Mexico border, where the number of adults without a high school diploma is increasing, as compared to the rest of the state.

With 93 students dropping out of Texas public schools every hour of every school day and an increase in immigrants working here without diplomas, Texas is facing a definite lag in educational gains.
According to Taylor, the future of the Texas economy is in jeopardy and the need for higher graduation rates and educated workers is evident.

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