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Education as a Rural Development Strategy
Robert
Gibbs
Dave Reede, AgStockUSAEducational attainment in
rural America reached a historic high in 2000, with nearly one in
six rural adults holding a 4-year college degree, and more than
three in four completing high school. As the demand for workers
with higher educational qualifications rises, many rural policymakers
have come to view local educational levels as a critical determinant
of job and income growth in their communities. Attracting employers
who provide higher skill jobs and encouraging educational gains
are seen as complementary components of a high-skill, high-wage
development strategy.
But policymakers are faced with two key questions. First, does
a better educated population lead to greater economic growth? According
to a recent study, rural counties with high educational levels saw
more rapid earnings and income growth over the past two decades
than counties with lower educational levels. However, economic returns
to education for rural areas continue to lag those for urban areas.
Second, are there ways to improve local educational attainment,
particularly through improvements in elementary and high schools,
that can enhance the economic well-being of rural residents and
communities? In fact, preliminary research demonstrates a connection
between better schools and positive outcomes in terms of earnings
and income growth for rural workers and rural communities.
Ultimately, the strength of the tie between education and economic
outcomes is influenced in part by the extent to which small rural
counties lose young adults through outmigration. The loss of potential
workers from rural areas, as young adults leave for college and
work opportunities in urban areas, has concerned rural observers
for many decades. This rural "brain drain" not only deprives
rural employers of an educated workforce, but also depletes local
resources because communities that have invested in these workers'
education reap little return on that investment.
Rural Adults Post Major But Uneven Educational Gains
The rise in educational attainment since the end of World War II
has been a remarkable success story in rural America. In 1970, 7
percent of rural adults had graduated from college, while 56 percent
of the rural adult population did not have a high school diploma.
By 2000, 16 percent of rural adults age 25 and older had completed
college and more than 75 percent had finished high school.
Though rapid, these gains understate the educational attainment
of the younger working population, ages 25-44. Nearly one-fourth
of rural younger adults have at least a 4-year college degree, and
over 80 percent have completed high school. Gains in educational
attainment in rural areas were particularly pronounced during the
1960s, dividing the generation that viewed college as an option
for the relatively few from the generation for whom college attendance
became "ordinary."
A similar divide can be seen in the steady increase in job skill
requirements of rural firms, as employment shifted over time from
farm to factory to services. Between 1980 and 2000, for instance,
the share of rural workers in low-skill jobs fell from 47 to 42
percent.
The relationship between high educational levels and high-skill
jobs has prompted many communities to pay closer attention to the
role of workforce education and training in their economic development
plans. But the benefit of raising educational levels will vary widely
from place to place because of the sharp disparity in educational
attainment across rural America. In nonmetro counties where at least
one-fourth of the population age 25 and older lacks a high school
diploma, job growth has been steady, yet income levels typically
fall well below the national average. In other nonmetro counties
where the great majority of adults have completed high school, the
need to improve workforce education levels is likely to be less
urgent.
Workforce Education Affects Economic Growth
Higher educational levels contribute to local economic development
in several ways. First, a well-educated workforce facilitates the
adoption of new ways of producing goods or providing services among
local businesses. Second, prospective employers may view a well-educated
local labor force as an asset when choosing among alternative locations
for new establishments. Both factors could help improve a community's
chances of attracting new businesses, particularly those businesses
that require highly skilled employees. Finally, higher educational
levels are almost always tied to geographic clusters of certain
key industries, which in some cases have generated major economic
growth in rural areas.
According to research presented at a 2003 conference on rural education
cosponsored by ERS, the higher the level of educational attainment,
the faster the growth rates in both per capita income and employment
(see The Role of Education in Rural America).
Researchers at Clemson University found that counties in the rural
South with a 5-percentage- point higher share of adults attending
college in 1980 reported, on average, 3.5 percent faster growth
per year in per capita income over the next 20 years and 5.5 percent
faster growth in employment. For a typical county in 2000, this
translates into $325 more in per capita income and 150 additional
workers. Given an average population of 24,700 in the study counties,
the average increase in total annual county income would be approximately
$8 million, or about 4 percent above actual 2000 income levels.
In urban areas, annual income growth after 1980 rose 9 percent for
each 5-point gain in college-educated adults, and annual employment
grew 7 percent.
Another study conducted by researchers at Penn State University
found that rural counties with a 1-percentage-point higher share
of adults with a high school diploma reported $128 more per capita
income, even after adjusting for other characteristics that affect
income, such as infrastructure, industry structure, and degree of
urbanization. But the same 1-percentage-point increase in urban
counties raised per capita income by $413.
These studies qualify the role of education in rural economic prosperity
in two ways. First, urban areas benefit disproportionately from
a well-educated workforce. Second, benefits from higher educational
levels depend on other local factors, but primarily for urban areas.
Within rural areas, population density, access to interstate highways,
social capital, and school characteristics have little power to
enhance or inhibit the influence of educational levels on income
and employment. As a result, there is little evidence that economic
development strategies based on raising workforce education levels
will be equally successful regardless of a community's other characteristics.
Areas with high educational levels also have high-skill employment
bases that have adapted to the particular features of the area.
Thus, infrastructure and urbanization enhance the effect of education
primarily by influencing the kinds of jobs found in the local economy.
Better Schools Promote Higher Achievement and Earnings
If higher levels of education boost local economic performance,
how might localities pursue a development strategy that incorporates
improvements in education? In the past, rural areas seeking to stem
the brain drain emphasized strategies to retain well-educated youth
and adults and attract new residents by encouraging higher skill
employment growth. "Workforce development" most often
meant investing in job training programs, both by States and local
jurisdictions. More recently, attention has turned to improving
the quality of local schools in order to raise the level of performance
and well-being of the local workforce. Rural areas may also view
good schools as an amenity for prospective employers and workers
who must move families to the area.
The
Role of Education in Rural America |
In April 2003, ERS cosponsored
a 2-day conference with the Southern Rural Development Center
(SRDC) and the Rural School and Community Trust that brought
together researchers, policymakers, and educators from around
the country to examine the issues surrounding rural education
and local economic development. Findings from conference
presentations were published in December 2004 as a major
SRDC policy report, The Role of Education: Promoting
the Social and Economic Vitality of Rural America,
and in 2005 as special issues of two peer-reviewed journals,
the Review of Regional Studies and the Journal
of Research in Rural Education. The research of Stephan
Goetz and Anil Rupasingha, Penn State University, and David
Barkley, Mark Henry, and Haizhen Li, Clemson University,
have been key resources for this Amber Waves article. |
Improvement of rural schools, however, faces special challenges,
especially in balancing resources and outcomes. As is often the
case with service provision in rural areas, costs per pupil may
exceed the national average because rural schools often cannot take
advantage of economies of scale provided by a large population base.
Moreover, rural counties often lose a large portion of their youth
to places with better job and educational opportunities. Thus, the
future income and tax revenues that rural students could generate—the
"social returns" on school investments—may be lost
to other, often urban, places, and investments designed to improve
schools may not pay off for the local community in the long run.
The financial challenges and geographic isolation facing rural
schools often contribute to educational disadvantages. Standardized
test data show that rural students tend to score below suburban
students in math and reading, but on par with central city students.
Rural teachers earn less, on average, than urban teachers and are
less likely to hold an advanced degree or be certified in the subject
they teach. Rural schools are less likely to offer advanced classes
in science and math. But rural schools are also smaller and have
teacher-pupil ratios similar to urban schools.
Students in rural schools that offer advanced coursework and have
more qualified and better paid teachers score higher on standardized
math and reading tests. Once scores are adjusted for characteristics
related to school quality, the rural disadvantage disappears. These
factors are often closely related to the socioeconomic profile of
the students’ families. ERS found that characteristics of
rural families—race, sex of family head, English as a native
language, and family structure—actually gave rural students
a slight advantage over both suburban and central city students.
While family and personal characteristics contribute to the special
challenges of rural school systems, especially those in persistently
poor and low-education areas, they do not explain the rural disadvantage
as a whole.
The effect of school characteristics on student achievement shows
that schools have at least indirect influence over workforce
quality. Rural schools can also influence the economy directly
by their effect on workers' earnings. By age 26, workers who graduated
from rural high schools earned about 3 percent less than workers
who graduated from suburban high schools, after adjusting for educational
attainment, type of job, and current residence. When earnings are
further adjusted for rural school disadvantages, the rural-suburban
gap disappears. Rural students who graduate from better schools
will thus perform better in the labor market whether or not they
remain in rural areas. Because students who do better in school
are more likely to attend college and leave their home communities,
there is a tradeoff between improvements in local workforce quality
and the loss of young adults due to outmigration.
Outmigration May Diminish School Effects
Recent research shows that improvements in rural schools boost
local economic development prospects. Higher adult educational levels
lead to faster income and employment growth, and better schools
can produce higher academic achievements and improve longrun economic
prospects for students. According to a study of rural South Carolina
in the 1990s by researchers at Clemson University, a small but significant
link occurs between school quality (measured by student-teacher
ratios) and employment growth in the local community.
Continued movement of young adults from rural to urban areas for
college or higher paying jobs means that much of the potential benefit
to earnings from improving schools will be lost to the local community.
This effect weakens the rationale for supporting good schools, especially
if these improvements are perceived to encourage outmigration. Fifty-five
percent of rural young adults who attended college no longer resided
in their home county. Young adults who had not completed high school
were about half as likely to reside in a different county, with
high school graduates falling in the middle. Despite rural gains,
the rural-urban educational attainment gap remains high, and high-skill
jobs in large and medium-size cities continue to attract young adults.
Jurisdictions with significant economic or social distress may find
it especially difficult to leverage improvements in school quality
without concurrent changes in the local economy.
Although rural America continues to lose a disproportionate share
of its college-bound youth, the long-term loss is often substantially
less than the initial outflow, as many outmigrants return to raise
children, assist aging relatives, or use social networks to find
jobs. Communities may find good schools to be a particularly effective
way to capture a larger share of these potential returnees. Better
schools, for example, can make a difference to parents who want
to raise their children in the home environment they once enjoyed,
but who also seek the best possible education for their children.
Current Federal policy supports raising academic standards and workforce
educational levels regardless of a community's economic and social
profile. Such an approach holds great potential for helping individuals.
The benefit to rural communities, particularly in distressed areas,
could be greatest where human capital improvements are but one of
several parallel strategies (such as small business development)
aimed at building a local economy with greater job opportunities
and higher earnings.
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This article is drawn from...
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"Does
Human Capital Affect Rural Growth? Evidence from the South,"
by David Barkley, Mark Henry, and Haizhen Li, in The Role of
Education: Promoting the Economic and Social Vitality of Rural America,
Lionel J. Beaulieu and Robert Gibbs, eds., January 2005: 10-15.
The Role of Education: Promoting the Economic and Social Vitality
of Rural America, edited by Lionel Beaulieu and Robert
Gibbs, Southern Rural Development Center and USDA, Economic Research
Service, January 2005.
"How
the Returns to Education in Rural Areas Vary Across the Nation,"
by Stephan Goetz and Anil Rupasingha, in The Role of Education:
Promoting the Economic and Social Vitality of Rural America,
Lionel J. Beaulieu and Robert Gibbs, eds., January 2005: 6-9.
Low-Skill
Employment and the Changing Economy of Rural America, by
Robert Gibbs, Lorin Kusmin, and John Cromartie, ERR-10, USDA, Economic
Research Service, October 2005.
"The Role of Local School Quality in Rural Employment and Population
Growth," by David Barkley, Mark Henry, and Shuming Bao, in
Review of Regional Studies, Vol. 28, No. 1, Summer 1998:
81-102.
The
ERS Briefing Room on Rural Labor and Education.
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