Investing in What Works for Alabama Students Will Impact the State’s Economy in a Big Way

Recently, three expert economists published an essay projecting the economic impact in the poorest states if more of those states’ citizen-students graduated from high school fully and confidently prepared for the higher-level work they will face in postsecondary education or in the workforce. “College and Career Ready” is a phrase used often by policy wonks, but it has powerful meaning for our state.

In the essay published in EducationNext – “It Pays to Improve School Quality” – researchers Eric A. Hanushek, Jens Ruhose and Ludger Woessmann offer a future view of each state in the U.S. from an economic perspective. Since the passing of the Every Student Succeeds Act, the economists point out that states have the opportunity through more flexibility and less federal oversight to get traction toward improving student achievement. The time is now to get this right, if states embrace and invest in what works to improve education for all students, no matter where they live or what personal challenges they face.

Large economic benefits should accrue to states that take advantage of this new flexibility. When students learn more in school, they remain in the educational system longer and become more-skilled and -effective participants in the state’s workforce. While some graduates will migrate to other parts of the country, a majority will join the labor market in their own states, thus contributing directly to their economic strength. Over the long run, each state stands to receive an extraordinary rate of return on successful efforts to improve school quality. (It Pays to Improve School Quality, Summer 2016 / Vol. 16 No. 3)

It’s not just about graduating everyone, say the authors. They use a stronger and more complex indicator of success by focusing on how many students achieve the benchmarks of college and career readiness. The Alabama State Department of Education demonstrates this understanding in its use of multiple college and career-readiness indicators in Plan 2020, its long-term strategic plan for improving education statewide.

In 2014, The Public Affairs Research Council of Alabama and the Business Education Alliance published a similar report for the state of Alabama. Through the research of Auburn University at Montgomery Economics Professor Keivan Deravi, the report projected a potential $430 million-dollar impact on Alabama’s economy if the state’s goal of a 90%-graduation rate is achieved, the goal established in the State Department of Education’s Plan 2020. But the report also noted that to achieve significant impact, the goal has to be “prepared” graduates, and it identified investments and policies that would yield prepared graduates. (The Potential Economic Impact of Raising the High School Graduation Rate,, 8/1/2014)

The EducationNext report projects an even greater economic impact if Alabama students achieve at the level of the highest current performing state in the country (currently Minnesota). According to this study, Alabama would be among the top ten states to benefit economically by likely reaping the potential benefits of a $1,175 billion – yes, with a “B” – economic impact by 2030.

In addition to Plan 2020, Alabama has taken some initial steps toward graduating better prepared students. Gov. Bentley and the State Board of Education recently established a committee to take advantage of the new flexibility provided to states through the ESSA legislation. Legislators took some positive steps in the recent session by supporting investments with high rates of return. These ranged from expanding First Class voluntary Pre-K to expanding enrollment in Career Tech classes to expanding Advanced Placement (AP) through the partnership of the State Department of Education and A+ College Ready. Next year, roughly 25% of Alabama 4-year-olds will have access to high-quality pre-k, and more than half of the state’s school districts will receive targeted support to expand AP and pre-AP classes.

With a greater focus on investments in “what works” and policies that support growth in student success, Alabama can indeed realize a greater degree of economic growth.

Read the full EducationNext report here.

Read the full PARCA / BEA report here.

Read the latest PARCA/BEA report, “Teachers Matter,” here.