Berkeley Adult School blog

On Friday, May 20, Bay Area Adult Education Administrators met for our annual luncheon, and we welcomed our CDE Director of Adult Education, Debra Jones. Ms. Jones shared a new report which is important to get to our stakeholders, locally and beyond (BUSD community, City and County officials, local, state and national representatives). This document speaks about the return on investment from Adult Education. I urge you to download and read the entire white paper at http://www.mcgraw-hillresearchfoundation.org/roi-adult-ed-and-training and I feel compelled to share the introduction here, now.

Executive Summary

The current sharp focus on deficit reduction in Washington, DC, and in state capitals around the country obscures the very real economic benefits U.S. society derives from its public investment in adult education and workforce development programs.

It is important to keep in mind – especially during tough economic times – that a preemptive focus on adult education actually saves governments money by reducing societal healthcare, public assistance, and incarceration costs. Adult education also improves and expands the nation’s available pool of human capital by helping motivated but under educated people achieve gainful employment in today’s increasingly high-tech and global job market, and at a far lower cost per learner when compared to either K-12 or higher education.

As a result, adult education and career training is potentially one of the most cost-effective tools the nation has to recover its economic health in the aftermath of the “Great Recession.”

The Alliance for Excellent Education (AEE) and other groups have been taking advantage of sophisticated economic impact modeling tools to quantify just how much society gains from its investment in adult education at the national, state, and local levels, not only in terms of direct economic benefits (higher salaries, leading to more consumer spending and increased tax revenues), but also in terms of lower social costs (reduced public assistance, reduced prison costs due to lower rates of recidivism) and improved quality of life for both individuals and society.

In 2010, for example, AEE released a report that analyzed the effect of educational achievement on the local economies of the 45 largest metropolitan areas in the U.S. (comprising the nation’s 50 largest cities).

Employing a forecasting model developed by Economic Modeling Systems, Inc., AEE was able to calculate how each of these local metropolitan economies would benefit in the future in areas such as: individual earnings; home and auto sales; jobs and economic growth; spending and investment; and tax revenues.

They found that if only half of the dropouts from the Class of 2008 from these 45 metropolitan areas had managed to graduate, they would have contributed the following additional combined economic benefit to their communities during an average year:

• $4.1 billion in additional earnings, compared to their likely earnings without a diploma;

• An additional $2.8 billion in spending and $1.1 billion in investments;

• They would have purchased homes worth $10.5 billion more mid-career than they would have been able to buy as dropouts, and spent an additional $340 million on vehicle purchases each year;

• Their additional spending and investments would have likely generated 30,000 new jobs, increasing the gross regional products of their areas by $5.3 billion at around the time they reached the midpoint of their careers; and

• State and local tax revenues in each of the areas would have increased as a result of this increased economic activity – an additional $536 million in an average year.

Adult education is an investment that can help recapture some, if not all, of these potential losses.

In addition, several states have made concerted efforts to demonstrate the economic value received from the public’s investment in workforce and adult education programs in their states. Included in this report are some of the highlights from various studies and reports concerning the cost/benefit ratios of adult education in Arizona, Arkansas, Georgia, Nevada, Minnesota, Michigan, New Mexico, Rhode Island, Tennessee, and Texas.

Adult education is also an investment in the future of our nation, as research shows that better educated parents raise better-educated, more successful children, who are less likely to end up in poverty or prison.

A recent infusion of additional public funding from the American Recovery and Reinvestment Act of 2009 (ARRA) has demonstrated what can be accomplished in a short amount of time when adult education programs are: well funded and aligned with employment-oriented services that focus on the customer (the learner), attuned to occupational needs at the local level; and committed to monitoring performance for continuous improvement.

As the authors of a 2008 report prepared by the National Commission on Adult Literacy wrote:

“[A] decade into the 21st century, America faces a choice. We can invest in the basic education and skills of our workforce and remain competitive in today’s global economy, or we can continue to overlook the glaring evidence of a national crisis and move further down the path to decline.”