A new study by the Milken Institute found a strong relationship between a well-educated population and a region’s economic performance.1 Though it’s common knowledge that well-educated workers often make more money and have better jobs than less-educated workers, this study stands out in that it also found that just by their geographic location, less-educated people can make more money if they live in the same area as more-educated people.
Other key findings from the report include:
- Education increases regional prosperity. Adding one year to the average years of schooling among the employed in a metropolitan area is associated with an increase of real GDP per capita of more than ten percent, and an increase in real wages per worker of more than eight percent.
- Better educated = bigger benefits. The better educated the worker, the greater the benefit of additional schooling, to both the worker and the region. Add one year of college to a region’s workforce, for instance, and GDP per capita jumps 17.4 percent.
- Clusters count. In metros with clusters of high-skilled occupations, the share of workers holding at least a master’s degree is much higher than in metros without significant clusters, perhaps because of the intense competition for employment.
In order to use the findings to improve the economy, one recommendation by the institute is to increase the number of college graduates. As we all know, this is easier said than done. One of the greatest barriers that stands between a student and graduation is unpreparedness. This unpreparedness can start as early as preschool, and if not addressed, will stick with the student until graduation day, if they are lucky enough to make it there. Many of today’s students and high school graduates understand the need for some form of higher education in order to have real career options in the 21st century. However, many students today get left behind in K-12 and enter college unprepared, often taking developmental (or remedial) courses before they can enroll in a college-level course.