America the Uneducated

William C. Symonds, Business Week, Nov. 21

How did the U.S. become the world’s largest economy? A key part of the answer is education. Some 85% of adult Americans have at least a high school degree today, up from just 25% in 1940. Similarly, 28% have a college degree, a fivefold gain over this period. Today’s U.S. workforce is the most educated in the world.

But now, for the first time ever, America’s educational gains are poised to stall because of growing demographic trends. If these trends continue, the share of the U.S. workforce with high school and college degrees may not only fail to keep rising over the next 15 years but could actually decline slightly, warns a report released on Nov. 9 by the National Center for Public Policy & Higher Education, a nonprofit group based in San Jose, Calif. The key reason: As highly educated baby boomers retire, they’ll be replaced by mounting numbers of young Hispanics and African Americans, who are far less likely to earn degrees.

Because workers with fewer years of education earn so much less, U.S. living standards could take a dive unless something is done, the report argues. It calculates that lower educational levels could slice inflation-adjusted per capita incomes in the U.S. by 2% by 2020. They surged over 40% from 1980 to 2000.

Not everyone is so pessimistic. Education Secretary Margaret Spelling argues that President Bush’s 2001 education reform law, the No Child Left Behind Act, is working to lift minority education levels. “It makes me bristle when I hear people say, ‘There’s no way in hell we can have our children reach grade-level proficiency,”’ she says.

Still, the Center’s projections are especially alarming in light of the startling educational gains so many other countries are achieving. U.S. high school math and reading scores already rank below those of most of the advanced economies in Europe and Asia. Now education is exploding in countries such as China and India. There are nearly as many college students in China as in the U.S. Within a decade, the Conference Board projects, students in such countries will be just as likely as those in the U.S. and Europe to get a high school education. Given their much larger populations, that should enable them to churn out far more college graduates as well. More U.S. white-collar jobs will then be likely to move offshore, warns National Center President Patrick M. Callan. “For the U.S. economy, the implication of these trends is really stark,” he says.

Callan’s projections are based on the growing diversity of the U.S. population. As recently as 1980, the U.S. workforce was 82% white. By 2020, it will be just 63% white. Over this 40-year span, the share of minorities will double, to 37%, as that of Hispanic workers nearly triples, to 17%. The problem is, both Hispanics and African Americans are far less likely to earn degrees than their white counterparts. If those gaps persist, the number of Americans age 26 to 64 who don’t even have a high school degree could soar by 7 million, to 31 million, by 2020. Meanwhile, although the actual number of adults with at least a college degree would grow, their share of the workforce could fall by a percentage point, to 25.5%.

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