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NC Spends $150K Per High School Diploma. Are We Getting Our Money's Worth?
Publisher's note: This post, by Bob Luebke, was originally published in the Education section of Civitas's online edition.
Our new analysis shows that North Carolina taxpayers spend about $150,000 for each student who receives a high school diploma.
That amount doesn't even include capital costs and other major expenses. Of course, the high price tag might be worth it, but this new study also shows there's very little connection between how much money is spent and how well our children do in the classroom.
In 2013-14 North Carolina spent over $8 billion on our K-12 public schools. Since the goal of K-12 education is receipt of a high school diploma, this study asked two questions: 1) How much do taxpayers spend to educate each high school graduate and 2) what is the quality of the education students are receiving?
According to the General Assembly's Fiscal Research Division, in 2012-13 (latest data available) North Carolina spent $8,514 per student1. This figure includes actual local, state and federal expenditures and reflects current normal operating expenses only. The figure does not include capital expenses, federal school lunch programs, debt service or transportation costs. Adding these costs can typically increase per pupil spending by up to 25 percent2.
So if someone tells you North Carolina spent approximately $8,500 per student last year, you should know that number is already considerably understated and it's really not the right statistic. Moreover, it says little about how much value the school adds to the community. More importantly, that figure says nothing about the effectiveness or efficiency of the learning process.
Clearly we need a better way to assess the cost and quality of education. Factoring in how many students actually graduate is one way to do it. A high school diploma serves as the natural capstone of K-12 education and as the gateway to higher education, while dropping out is an educational failure. North Carolinians have a right to know how much communities spend to educate each person who actually gets that high school diploma. Citizens also have a right to know the quality of the education students are receiving.
To calculate the cost of a high school diploma in North Carolina, this study gathered average state, federal and local per student expenditure data for students in kindergarten through twelfth grade for the years 2000-01 to 2012-13.
To provide an estimate of the costs of a high school diploma, expenditures were collected, summed and adjusted for inflation. Yet expenditures fail to reveal the real costs – to the individual or society – of dropping out. Labor and instructional costs have to be paid whether the student graduates or not3. Hence it is important to include these costs into an equation assessing the total costs of attaining the basic goal of the school system: graduating students from high school.
To create a more revealing picture of the true costs, the final adjusted per student expenditures number was divided by the 2012-13 graduation rate, expressed as a percentage. As this number is a fraction of 100 percent, the calculation will increase the per student dollars spent. The lower the graduation rate, the more will be added to the cost-to-graduation and vice versa.
Are our schools preparing our students properly for higher education or the world of work? It's a valid question. In 2012-13, the number of students who took one or more developmental (remediation) classes while attending North Carolina Community Colleges was 63 percent4. To assess education quality we gathered proficiency scores for End-of-Grade and End-of-Course tests. SAT and ACT scores were also included because they are national exams and provide a means of comparison across districts and states. In addition, the analysis also includes the percentage of students who met all four test (math, reading, English and science) ACT benchmarks5.
Table I (See Table Charts on original page) lists per student expenditure data adjusted for inflation along with a variety of academic performance data.
After adjusting for inflation, we found the average cost of educating a high school graduate in North Carolina was $124,316 in inflation-adjusted dollars. However, when we factor in North Carolina's graduation rate of 82.5 percent, the actual per student costs increase to $149,923.
Divided over 13 years of education (K through 12), that's an average annual per student cost of $11,532. That's about $3,000 more than the usual figure that is bandied about – and it's more than tuition at many private schools.
In addition to the higher per student costs, it's hard to ignore the great disparity among Local Education Agencies (LEAs) in the total per pupil expenditure costs to graduate. Table II lists the 20 highest- and lowest-spending LEAs. Hyde County leads in per student total expenditures to graduate with $266,831, and yearly costs of $20,525. Randolph County has the lowest per pupil costs to graduate at $114,129 – an annual per student cost of $8,779.
So what accounts for the difference? That may be traceable to a variety of things. The formula we use penalizes LEAs for students that don't graduate. However, the difference in graduation rates among many schools at the top and bottom of the list was less than you might expect. Differences may also be traceable to community priorities, how the public schools are financed, composition of the teaching staff, and level of state aid. Still, we need to ask: Should it cost Hyde County residents nearly two-and-a-half times more to educate a high school graduate than it does Randolph County?
Another factor worth noting is the absence of linkage between money and academic performance. Some interesting observations from a cursory review of the data include:
Our analysis reveals North Carolina spends about $11,500 annually to educate a high school graduate. Over 13 years of education that's nearly $150,000.
What's behind the numbers is disturbing. The range of average spending and academic outcomes should give parents, policymakers and educators concern. Results suggest that the financial assistance and additional resources the state provides to help underfunded, underperforming or disadvantaged LEAs have little impact in many schools.
Results also reveal no linkage between money and academic performance. Of course resources are important, but they can only do so much. A vast literature points to the importance of parental involvement, teacher quality and school leadership as critical factors in improving student achievement. As always happens, you arrive at a point of diminishing returns to investment. As such, spending additional money should not always be the first policy option.
Our findings raise a significant question: Are North Carolinians satisfied with the cost and the academic performance of the public schools? The results should cause us to seriously re-examine our spending and instructional practices as well as those of our best public and private schools. Without this effort we may find ourselves consigned to a path of spending more taxpayer money for schools, yet discovering that many deliver less in the way of education.
Go Back
How much of your money is spent to educate one high school graduate in North Carolina? $50,000? $75,000?
Our new analysis shows that North Carolina taxpayers spend about $150,000 for each student who receives a high school diploma.
That amount doesn't even include capital costs and other major expenses. Of course, the high price tag might be worth it, but this new study also shows there's very little connection between how much money is spent and how well our children do in the classroom.
In 2013-14 North Carolina spent over $8 billion on our K-12 public schools. Since the goal of K-12 education is receipt of a high school diploma, this study asked two questions: 1) How much do taxpayers spend to educate each high school graduate and 2) what is the quality of the education students are receiving?
According to the General Assembly's Fiscal Research Division, in 2012-13 (latest data available) North Carolina spent $8,514 per student1. This figure includes actual local, state and federal expenditures and reflects current normal operating expenses only. The figure does not include capital expenses, federal school lunch programs, debt service or transportation costs. Adding these costs can typically increase per pupil spending by up to 25 percent2.
So if someone tells you North Carolina spent approximately $8,500 per student last year, you should know that number is already considerably understated and it's really not the right statistic. Moreover, it says little about how much value the school adds to the community. More importantly, that figure says nothing about the effectiveness or efficiency of the learning process.
Clearly we need a better way to assess the cost and quality of education. Factoring in how many students actually graduate is one way to do it. A high school diploma serves as the natural capstone of K-12 education and as the gateway to higher education, while dropping out is an educational failure. North Carolinians have a right to know how much communities spend to educate each person who actually gets that high school diploma. Citizens also have a right to know the quality of the education students are receiving.
Methodology
To calculate the cost of a high school diploma in North Carolina, this study gathered average state, federal and local per student expenditure data for students in kindergarten through twelfth grade for the years 2000-01 to 2012-13.
To provide an estimate of the costs of a high school diploma, expenditures were collected, summed and adjusted for inflation. Yet expenditures fail to reveal the real costs – to the individual or society – of dropping out. Labor and instructional costs have to be paid whether the student graduates or not3. Hence it is important to include these costs into an equation assessing the total costs of attaining the basic goal of the school system: graduating students from high school.
To create a more revealing picture of the true costs, the final adjusted per student expenditures number was divided by the 2012-13 graduation rate, expressed as a percentage. As this number is a fraction of 100 percent, the calculation will increase the per student dollars spent. The lower the graduation rate, the more will be added to the cost-to-graduation and vice versa.
Are our schools preparing our students properly for higher education or the world of work? It's a valid question. In 2012-13, the number of students who took one or more developmental (remediation) classes while attending North Carolina Community Colleges was 63 percent4. To assess education quality we gathered proficiency scores for End-of-Grade and End-of-Course tests. SAT and ACT scores were also included because they are national exams and provide a means of comparison across districts and states. In addition, the analysis also includes the percentage of students who met all four test (math, reading, English and science) ACT benchmarks5.
Analysis
Table I (See Table Charts on original page) lists per student expenditure data adjusted for inflation along with a variety of academic performance data.
After adjusting for inflation, we found the average cost of educating a high school graduate in North Carolina was $124,316 in inflation-adjusted dollars. However, when we factor in North Carolina's graduation rate of 82.5 percent, the actual per student costs increase to $149,923.
Divided over 13 years of education (K through 12), that's an average annual per student cost of $11,532. That's about $3,000 more than the usual figure that is bandied about – and it's more than tuition at many private schools.
In addition to the higher per student costs, it's hard to ignore the great disparity among Local Education Agencies (LEAs) in the total per pupil expenditure costs to graduate. Table II lists the 20 highest- and lowest-spending LEAs. Hyde County leads in per student total expenditures to graduate with $266,831, and yearly costs of $20,525. Randolph County has the lowest per pupil costs to graduate at $114,129 – an annual per student cost of $8,779.
So what accounts for the difference? That may be traceable to a variety of things. The formula we use penalizes LEAs for students that don't graduate. However, the difference in graduation rates among many schools at the top and bottom of the list was less than you might expect. Differences may also be traceable to community priorities, how the public schools are financed, composition of the teaching staff, and level of state aid. Still, we need to ask: Should it cost Hyde County residents nearly two-and-a-half times more to educate a high school graduate than it does Randolph County?
Spending and Achievement
Another factor worth noting is the absence of linkage between money and academic performance. Some interesting observations from a cursory review of the data include:
- Of the 31 LEAs that scored at or above the state average (18.7) for graduating seniors on the ACT test, 23 LEAs actually spent below the average per student expenditure ($149,923).
- Of the top 20 highest-spending LEAs: only two, Asheville City Schools and Polk County Schools:
- performed better than the state average (43.9) percentage of Grade 3 through 8 students who score at or above grade level in reading.
- exceeded the state average (43.9) percentage of scores of Grade 3 through 8 students who scored at or above grade level in math.
- exceeded the state average of percentage of passing scores (44.1) on End-of-Course (EOC) exams.
- had SAT scores higher than the state average of 1001.
- had ACT scores higher than the state average (18.7) for graduating seniors.
- exceeded the state average percentage of students (17) meeting all for four subject ACT benchmarks (English, math, reading and science).
- Of the 20 lowest-spending LEAs:
- Nine exceeded the state average percentage (43.9) of grade 3 through 8 student scores at or above grade level in reading.
- Eleven exceeded the state average percentage (42.3) of grades 3 through 8 students who score at or above grade level in math.
- Thirteen exceeded state average of the percentage of passing scores (44.1) on End-of-Course tests.
- Seven had SAT averages that exceed the state average (1001).
- Seven had ACT scores that exceed the state average (18.7).
- Five had ACT scores that were higher than the state average percentage (17) of students that met all four ACT benchmark scores in reading, math, English and science.
Conclusion
Our analysis reveals North Carolina spends about $11,500 annually to educate a high school graduate. Over 13 years of education that's nearly $150,000.
What's behind the numbers is disturbing. The range of average spending and academic outcomes should give parents, policymakers and educators concern. Results suggest that the financial assistance and additional resources the state provides to help underfunded, underperforming or disadvantaged LEAs have little impact in many schools.
Results also reveal no linkage between money and academic performance. Of course resources are important, but they can only do so much. A vast literature points to the importance of parental involvement, teacher quality and school leadership as critical factors in improving student achievement. As always happens, you arrive at a point of diminishing returns to investment. As such, spending additional money should not always be the first policy option.
Our findings raise a significant question: Are North Carolinians satisfied with the cost and the academic performance of the public schools? The results should cause us to seriously re-examine our spending and instructional practices as well as those of our best public and private schools. Without this effort we may find ourselves consigned to a path of spending more taxpayer money for schools, yet discovering that many deliver less in the way of education.
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