Editorial: Dropouts cost money

Philadelphia already had plenty of incentive to reduce its high school dropout rate, but now there's even more.

A new study by the Alliance for Excellent Education has calculated that cutting the city's dropout rate in half would produce graduates who would earn $125 million more a year than they would without a diploma. They would also pay $18 million more in taxes.

The study says the additional high school graduates would spend $294 million more on homes, and spend an additional $83 million and invest an additional $32 million each year.

Nationally, the study estimates, lowering the dropout rate could translate into economic gains that could reach the billions.

The new numbers make it even more urgent for Mayor Nutter to succeed in his push to cut the dropout rate in half and produce a better-educated workforce.

The new study says that an estimated 600,000 students dropped out of school in 2008 in the nation's 50 largest cities and surrounding regions.

It said that 16,400 of those dropouts were in Philadelphia in 2008, and that every year, 23 percent of the high schoolers in this region fail to graduate on time.

The personal toll on the dropouts should be enough incentive to prompt stakeholders to take more decisive action to stop the exodus in public education. But as this study shows, there's also a regional economic incentive.

Dropouts earn less and spend less, so they contribute less to the economy. Their decision to forgo a basic education affects not only their lives, but also the bottom line for everyone else.

Alliance President Bob Wise says his group's data show that "the best economic stimulus package is a high school diploma."

The study's conclusion is a no-brainer: The United States must have an educated workforce with the necessary skills for a changing global market.

Here in Philadelphia, Nutter laid out an impressive agenda this week when he released a two-year progress report on his education goals. The bottom line: There is still much work to be done to raise the achievement bar in this city.

While graduation rates have inched up 3 percent since 2008, four of every 10 students still fail to graduate in six years.

The city's dropout rate has been estimated to be as high as 50 percent in recent years. But district officials say it was 29 percent in 2009, up slightly from 28 percent the year before.

Dropout calculations can vary depending on the formula used, supporting the need for a uniform national standard to get a more accurate read.

By any measure, though, too many students are still dropping out, and thousands more are at risk. They need intervention, including slots in alternative schools and mentoring. Investing in them will yield big returns.