PROVIDENCE – Two studies of the Rhode Island work force released today emphasize the role played by educational attainment in determining economic outcomes for individual Rhode Islanders and the state as a whole, the studies’ author says.
The two reports were prepared by Paul E. Harrington, director of the Center for Labor Market Studies at Northeastern University in Boston, and released this morning at the Greater Providence Chamber of Commerce’s Business Over Easy breakfast, which was held at the Providence Marriott.
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Harrington’s first report – entitled “The Labor Market Impacts of the National Economic Crisis in Rhode Island” – found sizable differences in the number of job losses in Rhode Island for people in certain industries, occupations and demographic groups.
About 65 percent of job losses in Rhode Island in the past two years have been among blue collar workers, with the biggest employment declines suffered by blue collar workers in the construction, manufacturing, trade, transportation and utilities sectors, the study found.
By contrast, Harrington said workers with higher education levels were “somewhat insulated from the worst effects of the recession.”
Harrington also found that the rate of employment among men in Rhode Island, which declined by more than 12 percent over the past two years, fell at almost double the rate among women. In addition, employment among teens and young adults fell 17 percent, while employment of those between the ages of 25 and 54 declined 11 percent, the study found.
The only age group that saw an increase in employment over the last two years was the cohort of those 55 and older, which grew 6 percent in the state.
In addition, Harrington’s second study – entitled “The Fiscal Consequences of Dropping Out of High School in Rhode Island” – found that those who drop out of high school impose higher costs on local, state and federal governments, because they use more government services and their smaller earning potential results in less tax revenue.
By Harrington’s estimate, the average lifetime earnings of a high school dropout in Rhode Island is expected to be $827,000. That is 46 percent less than the estimated lifetime earnings for high school graduates with no secondary education, who are forecast to make $1.2 million; 260 percent less than the $2.15 million in lifetime earnings for workers with a bachelor’s degree; and 332 percent less than the $2.75 million in lifetime earnings for workers with a master’s degree or higher.
Harrington estimated that dropouts impose a net lifetime cost of $72,000 on all levels of government, whereas those who finish high school make a net lifetime contribution of $317,000 to government coffers – for a net savings to government of $389,000 when someone chooses to finish high school rather than drop out.
“Taken together, these studies suggest that both in the short term as well as the long run, opportunities to reach a middle class standard of living in Rhode Island are closely related to higher levels of educational attainment,” Harrington said in a statement. “Efforts to retain students in the state’s public and private secondary and post-secondary system should be a cornerstone of both education and economic development efforts in the state.”
Janet Raymond, senior vice president of operations and economic development at the Greater Providence Chamber of Commerce, added: “These reports clearly identify the need for us as a state to focus on reducing Rhode Island’s dropout rate and developing strategies to address this issue.”
The full studies are available at ProvidenceChamber.com.
The Greater Providence Chamber of Commerce aims to foster a healthy business climate throughout Rhode Island through public policies, economic development and business-to-business relationships. Based in downtown Providence, it has more than 2,300 member businesses across the state. To learn more, visit www.ProvidenceChamber.com.
