The Economic Benefits from Halving Phoenix–Mesa’s Dropout Rate

Phoenix
A Boom to REgio n a l Bu si n es se s
Mesa
Maricopa

“T he best economic stimulus package is a high school diploma.” Pinal

Governor Bob Wise

President, Alliance for Excellent Education ARIZONA

January 2010

In the Phoenix–Mesa metropolitan area, an estimated 11,100 students dropped out from the Class
Every Student Counts
of 2008 at great cost not only to themselves but also to their communities. Reducing the number
of dropouts by 50 percent for this single high school class would result in tremendous economic Moving even just one student from
dropout status to graduate status will
benefits to the Phoenix–Mesa region. Below, see the likely contributionsi that these 5,600 “new
make positive contributions to a local
graduates” would make to their regional economy: economy. This box offers a scaled-back
look at the figures presented to the left,
An additional $50 projecting the likely benefits if just 1,000
$71 million local dropouts had graduated. These
million in spending
in Increased 1,000 new graduates would likely
and $19 million
Earnings
in investing • earn $13 million in additional
earnings each year;
This single class of new graduates would likely earn Increased earnings would likely allow new graduates • spend an additional $1.1 million
as much as $71 million in combined earnings in the to spend an additional $50 million and invest an each year purchasing vehicles and,
average year compared to their likely earnings without additional $19 million during the average year. by the time they reach the midpoint
a diploma. of their careers, would buy homes
worth $33 million more than what
they would likely have spent without
Increased a diploma; and
650 new jobs
home sales
and economic • support 120 new jobs in the region,
of $186 Million increase the gross regional product
growth of
and auto sales by $17 million, and pour an
$97 million
of $6 million additional $1.3 million annually into
state and local coffers, all through
By the midpoint of their careers, these new graduates This additional spending and investment would likely their increased spending and
would likely purchase homes totaling a value of as be enough to support 650 new jobs and increase the investments.
much as $186 million more than what they otherwise gross regional product by as much as $97 million by
would have spent without a diploma. In addition, they the time these new graduates reach the midpoint of
would likely spend up to an additional $6 million on their careers. About the Phoenix–Mesa Metro
vehicle purchases each year. Area
• The Phoenix–Mesa metro area includes
the two cities and two surrounding
counties (see map above).
$7 million in Increased
increased tax Human • The region is home to 197 high schools.
revenue Capital Twenty of these are considered dropout
factories, i.e., schools where fewer than
60 percent of freshmen progress to their
As a result of increased wages and higher levels of After earning a high school diploma, 66 percent of senior year on time.
spending, state and local tax revenue within this region these new graduates would likely continue on to • Twenty-four percent of high school
would likely grow by as much as $7 million during the pursue some type of postsecondary education. students in the region do not graduate
average year. on time with a regular diploma.
i
These figures represent estimates of gross benefits to the regional economy and are not intended to reflect the net impact of additional graduates.

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technical notes, and learn about the solutions.