Last Modified: Friday, June 01, 2012 12:55 PMA decrease in the number of local high school dropouts could bring regional economic benefits of as much as $9.7 million, a recent study by the Alliance for Excellent Education found.
The alliance, a nonprofit that works to improve national graduation rates, conducted a study targeted at the Lake Charles metropolitan statistical area, made up of Calcasieu and Cameron parishes.
It outlined the effects on the area’s economy if the number of high school dropouts was cut in half. In this area, 38 percent of high school students do not graduate on time with a regular diploma.
For the study, the alliance estimated 1,100 students dropped out of the local high school class of 2010 and it answered the questions “What if that number was cut in half? What would that mean for the new graduate and for the economy of the area?”
According to the alliance, the 550 new graduates would collectively be expected to earn as much as $7.9 million more in an average year, compared to earnings without a diploma. These earnings would likely allow them to spend up to an additional $6 million and invest $1.9 million more during an average year.
Over time, these graduates combined would be expected to spend as much as $14 million more on home purchases than they would without a diploma and spend an addition $500,000 more on vehicle purchases during an average year, the alliance found.
These higher spending habits would have a positive effect on the region, according to the alliance.
The expected spending and investments would support as many as 50 new jobs and increase the gross regional product by as much as $9.7 million by the time these graduates reach their career midpoints. State and local tax revenue would also be expected to grow by as much as $400,000 in an average year.
“I think a lot of people are aware of the individual benefits when you get a high school diploma, but we also wanted people to know that it has a benefit to a community,” said alliance spokesman Jason Amos.
“At the heart of the model is the fact that graduates earn more than dropouts. When they earn more, spending increases. It’s a ripple effect.”
Education and Economy in Lake Charles