According to U.S. Census Bureau figures, the unemployment rate last year among high-school dropouts between ages 16 and 24 was 29%–up from 17.7% in 2000 and seven points higher than that of their peers who finished high school but didn’t go on to college.
The problem is particularly acute among Hispanics and African-Americans. Several studies have found that only about 50% of black and Hispanic students graduate from high school, compared with 75% of white students.
Up to 40% of the young people in these communities qualify as “disconnected youth,” the term for young adults who are neither in school nor working, says David Dodson, president of MDC Inc., a research organization in Durham, N.C.
“They’ve given up hope,” says Phillip Jackson, executive director of Chicago’s Black Star Project, which helps African-American youth stay in school. He estimates that 75% to 80% of the young black men in Chicago are jobless.
“It leads to violence, broken families and hyperincarceration,” for economic crimes that range from selling bootleg CDs to drug trafficking, he says.
Andrew Sum, an economist at Northeastern University who studies disconnected youth, says dropouts will suffer a lifetime earnings loss of around $400,000 compared with high-school graduates.
“This is the only group with no net contribution to the fiscal well-being of state and national government,” says Mr. Sum.