From Educating the Individual to Retooling the Nation: The Critical Role of ABE Educators

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From Educating the Individual to Retooling the
NationThe Critical Role of ABE Educators

• Bruce P. Corrie, PhD
• Professor of Economics
• Concordia University-Saint Paul

2006 ABE Statewide Summer InstituteSaint Johns
UniversityFunded by an Otto Bremer Grant
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Overview

• A New Paradigm
• The Emerging Challenge
• The Return on Investment in ABE
• A New Marshall Plan

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ABE Educators A New Vision

• You are not just educating the individual
• You are retooling the nation and Minnesota in our
  new global competitive economy
• Your special focus on the low-skilled
  youth/worker is very critical for the nations
  and the Minnesotas long term economic security
  and growth. This critical mass of people in the
  US and local economy need immediate attention
  else we will face serious problems in the years
  ahead.

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A New Vision

• The nation needs to develop strategies to retool
  the low wage low skill workforce in the face of
  global competition.
• ABE programs play a very important role as they
  improve the skills of workers and in so doing,
  increase productivity in the workplace have a
  number of other social benefits, and raise the
  standard of living in local economies and
  national economies.
• We need a new Marshall Plan to invest in this
  disenfranchised population.

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Overview

• Next slides will present
• Data on the number of low skilled workers
• Data on the declining need for low skilled
  workers in the USA by our firms
• Data on the challenges of an important pool of
  future workers in MN immigrants and minorities
• Data on the effectiveness of ABE in meeting the
  challenges of our future workforce
• Data to illustrate how investing in our emerging
  workforce through ABE programs help to strengthen
  the economic base in MN.

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The Challenge

• 1.9 million workers with wages at or below 5.15
  an hour in the US
• 561 thousand without a high school degree
• 547 thousand high school without college
• 62, 800 thousand in Minnesota
• Source CPS 2006, Census 2000 from DEED data for
  MN.

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Challenge MN

• In Minnesota, 30 percent of all workers or over
  800,000 workers are low-wage workers. The
  proportion of low-wage workers in Greater
  Minnesota varies from a low of 35 percent in the
  Southeast region to a high of 46 percent in the
  Northwest Region. (Less than 10 an hour)
• http//www.deed.state.mn.us/lmi/publications/waged
  ist/98_00/region.htm

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Who are low wage workers?

• Are disproportionately - Young, female, minority,
  with a high school degree or less and with health
  limitations
• Characteristics of Low Wage Workers and their
  Labor Market Experiences. http//aspe.hhs.gov/hsp/
  low-wage-workers04/ch7.htm

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Challenge Employers want higher skills

• Large study which included Minnesota found
  employers reduced employment shares of low
  skilled workers and increased shares of high
  skilled workers in virtually every industry.
• Found a continuing up-skilling of the work force
• John Abowd, Paul Lengermann, Kevin L McKinney
  (2003), Measurement of Human Capital in the U.S.
  Economy. US Census, LEHD Program.

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Challenge Firms Need High Skills to Increase
Productivity and Grow

• Found that quality of the Human capital of the
  firm determined productivity and market value of
  the firm.
• Bowd J.A. et al (2002) The Relation among Human
  Capital, Productivity and Market Value Building
  up from Micro Evidence. US Census, LEHD Program

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Challenge MN Population Crisis

• According to both the MN State Demographer and
  the MN State Economist, MN is going to rely
  increasingly on migration to meet its labor needs
  because of an aging population.

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Minorities/Immigrants Increasing share of the
Prime workforce 2005-2030
Source MN State Demographer Population
Projections
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Minorities/Immigrants Increasing share of the
Tax Base 2005-2030
Source MN State Demographer Population
Projections
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Minorities/Immigrants Increasing share of the
Emerging workforce 2005-2030
Data from MN State Demographer Projections
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Many Minnesota Students Have Low Human Capital
Source Minnesota Minority Education Partnership,
2006
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Many Minnesota Students Have Low Human Capital
Source Minnesota Minority Education Partnership,
2006
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Human Capital of Minnesota

• Adults with no high school degree 9
• Adults with high school degree 29
• Adults with some college degree 32
• Adults with college degree or higher 30
• Source http//www.nccp.org/pdf/state_detail_conte
  xt_MN.pdf

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The Global View on Skills
Source Pathways to Labor Market Success. ETS,
2004
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Role of ABE in Retooling MN

• GED
• ELL
• Worker Training
• How effective are these programs?

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Impact of GED

• Leads to increase in earnings for high school
  dropouts with weak skills (36 percent for 27 year
  olds)
• Returns for postsecondary training is as high for
  GED as for traditional high school graduates
• Many other benefits such as increased literacy
  skills, more self confidence, better life skills.

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Impact of Schooling on Crime

• High school graduation rates results in a 0.8
  percent reduction in the probability of
  incarceration from Whites and a 3.4 percent
  reduction for Blacks.

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Impact of Schooling on Crime

• One additional year of schooling reduces
• Arrest rates by 11 percent
• Murder and assaults by 30 percent
• Motor Vehicle Theft by 20 percent
• Arson by 13 percent
• Net Benefit of 1.4 billion to the nation
• (However, increased rapes and robbery)
• Lance Lochner and Enrico Moretti, The Social
  Savings from Reducing Crimes through Education.
  Joint Center for Poverty Research
  http//www.jcpr.org/policybriefs/vol4_num5.html

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Impact of Schooling on Children in Poverty

• From 1984 to 2004 the number of children in
  poverty increased from 66 to 75 percent for
  families with parents with less than high school
  education
• It rose from 36 to 45 percent for parents with a
  high school diploma
• It remained at 17 percent for families with some
  college education
• National Center for Children in Poverty
  http//www.nccp.org/pub_pei06.html

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Literacy Proficiency and Employment
Higher Proficiency Lower Unemployment
Source Pathways to Labor Market Success. ETS,
2004
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Prose Proficiency and Education
Higher Education Higher Literacy Proficiency
Source Pathways to Labor Market Success. ETS,
2004
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Quantitative Proficiency and Earnings
Higher Quantitative Proficiency Higher Earnings
Source Pathways to Labor Market Success. ETS,
2004
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Immigrants, Lit Proficiency and Earnings
Higher Literacy Proficiency Higher Earnings
Source Sum et al (2002). ETS
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Premium for Speaking English
Source Sum et al (2002). ETS
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Reasons for Taking GED
Source National Adult Literacy Survey, 2005
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Reason for Taking ELL
Source National Adult Literacy Survey, 2005
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Low Skill Low Training Participation
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Returns to Schooling

• Barrow and Rouse (2006) using data from the
  Current Population Survey find that each
  additional year of schooling results in a average
  increase in earnings by 11 percent

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Immigrants

• Each year of schooling completed by an immigrant
  adds 6.2 points to their predicted composite
  literacy proficiency score.
• The earlier one began studying English, the
  higher his/her predicted proficiency score.

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Education and Living Standards

• According to the Economic Report of the
  President, 2006, studies have shown that during
  the period 1950-1993 one third of the economic
  growth in the country was due to increased levels
  of education

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Higher Education Lower Unemployment
Source 2006 State of Students of Color.
www.mnmep.org
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Higher Education Higher Income (US)
Source 2006 State of Students of Color.
www.mnmep.org
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So You Want to Be a Millionaire
LIFETIME EARNINGS BY EDUCATIONAL LEVEL (Day
Newburger, 2002)
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Retooling of Minorities in MN Adds to the
Economic Base of Minnesota

• More productive Workers
• Expands the consumer Base
• Increase Entrepreneurship
• Builds Cultural Capital
• Makes us competitive in the Global Economy

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Consumer Base

• According to the Selig Center Buying Power of
  minorities and immigrants is an estimated 12
  billion dollars.
• This is greater than the GDP of 90 countries in
  the world
• Higher skilled workers will have higher earnings
  and expand their consumer power in Minnesota

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Workers

• Minorities and immigrants are overrepresented in
  both the high skilled as well as low skilled
  occupations.
• Improving the skills of these workers will add to
  the productivity of Minnesota

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Black Workers in MN
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Asian and Latino Workers

• High Tech
• Medical Scientists
• Physicians and Surgeons
• Chemical Engineers
• Postsecondary Teachers
• Computers and Electronics
• Low Tech
• Food Preparation, processing
• Roofers
• Dining room and Cafeteria attendants
• Maids and Housekeeping Cleaners

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Minority/Immigrant Firms

• 22,405 minority firms in Minnesota
• with 2.7 billion in sales.
• 3497 of these firms had employees
• employing 31, 474 people
• with an annual payroll of 819 million dollars.

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Minority/Immigrant Firms

• Minority firms in Minnesota grew by 44 percent
  during 1997-2002 as compared to a growth rate of
  8 percent of all firms.
• American Indian firms were 13th in the nation in
  terms of growth of firms during the same period.

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Immigrant Firms on University Avenue in Saint
Paul (1980, 1991 2005)
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MN Integrated with the Global Economy

• MN Rank 2003, 2004
• Export Volume, 2004 20
• Exports (Latin S. America) 25
• Exports (Asia) 15
• Exports as Percent of GSP 23
• Employment (Foreign Companies) 22

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Cultural Capital is Important for Minnesota

• Richard Florida and the rise of the Creative
  Class
• New case for diversity brings creativity into
  an organization
• Minority food, art, culture, music, ideas,
  theatres adding vitality to Lake Wobegon

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Summary

• The nation needs to develop strategies to retool
  the low wage low skill workforce in the face of
  global competition.
• ABE programs play a very important role as they
  improve the skills of workers and in so doing,
  increase productivity in the workplace and have a
  number of other social benefits.
• Investing in Minorities and Immigrant communities
  will yield positive returns in the long run
• What we need is a new Marshall Plan to retool the
  nations low wage low skill workforce

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Data on Characteristics of GED and ELL Learners
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Characteristics of GED Population
National Adult Literacy Survey, 2005
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Characteristics of GED Population
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Characteristics of GED Population
National Adult Literacy Survey, 2005
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Characteristics of GED Population
National Adult Literacy Survey, 2005
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Characteristics of GED Population
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• Bruce P. Corrie, PhD
• Concordia University
• Saint Paul, MN 55117
• corrie_at_csp.edu
• Tel [phone]

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Characteristics of ELL Population
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Characteristics of ELL Population
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Characteristics of ELL Population
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Characteristics of ELL Population
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Characteristics of ELL Population