September 28, 2009

High school diploma alone isn’t the solution for livelihoods

Recent graduates from Philadelphia’s public high schools had higher employment rates and higher annual earnings than their classmates who dropped out, but many of them still did not have incomes above the federal poverty line, according to a new study from the Everyone Graduates Center at Johns Hopkins. The report suggests that although it is essential to increase high school graduation rates, “without additional postsecondary education, the effect of a high school diploma on lives and livelihoods may be rather limited.”

Untapped Potential: Early Labor Market Outcomes of Dropouts and Graduates from Philadelphia’s Public Schools, a study by Johns Hopkins researchers Ruth Curran Neild and Christopher Boccanfuso, looks at employment and earnings in Pennsylvania’s formal economy for students in the city’s classes of 2000–2005.

The report shows that only 35 percent of the dropouts from the classes of 2000–2005 had any earnings in Pennsylvania in 2006, compared to almost half the graduates. “For those dropouts who were employed, work was typically episodic and annual incomes low,” the study said. “The average employed dropout worked just 25 weeks during the year, earning just more than $9,000.” Those with diplomas averaged approximately $12,000 during 2006. Both dropouts and graduates with no postsecondary education were most likely to be employed in restaurants, security and janitorial services, and institutions that provide care for the elderly, ill and disabled.

Despite the importance to the city of knowing how its recent graduates and dropouts fare in the labor market, it is difficult to access these data, the researchers said. This new study draws on a unique data set that merges student academic records from the School District of Philadelphia and quarterly data on employment and earnings kept by the Pennsylvania Department of Labor and Industry. The report was prepared for Project U-Turn, a citywide campaign to resolve Philadelphia’s high school dropout crisis.

Untapped Potential reports on the same cohorts of students described in Unfulfilled Promise, a 2006 report on high school graduation rates in Philadelphia issued by Johns Hopkins and Project U-Turn. This new study provides two views of labor market outcomes: a description of employment and earnings in 2006, the most current year for which data is available, and an examination of the work experiences of the class of 2000 over multiple years.

The report also provides detailed data on employment and earnings by race/ethnicity and gender. Among dropouts, African-American and white females were most likely to be employed in Pennsylvania’s formal economy. Least likely were Asian males and females, but these groups had the highest mean earnings.

As students move into early adulthood, the earnings differential by education increases. High school graduates do experience greater earnings growth than dropouts, but the upward slope is much steeper for those with at least some postsecondary education. Further, six years after their anticipated high school graduation date (June 2000), employed dropouts were still weakly attached to the formal labor market, working an average of 26 weeks.

“Untapped Potential illustrates that students in the School District of Philadelphia who did not progress to postsecondary education after high school were marginally more prepared than high school dropouts for Pennsylvania’s 21st-century labor market,” said study author Boccanfuso. “That the gap in annual earnings between individuals with postsecondary education and those without expanded over the six years studied demonstrates that the effects of education on earnings were both significant and long-lasting.”

Because of this, the report urges schools and communities to think seriously about not only keeping students on the path to graduation but also helping them make a successful transition into postsecondary training and the work world.

The Everyone Graduates Center is located at Johns Hopkins’ Center for Social Organization of Schools. Project U-Turn is a collaborative campaign to build understanding of Philadelphia’s dropout crisis and implement strategies to resolve it. The William Penn Foundation, one of several major supporters of Project U-Turn, funded this research.

The full report is available at www   .every1graduates.org/UntappedPotential/index.html.