Down the hole: Illinois lost nearly $10 billion in 2005 from the "social costs" of high school dropouts. Some argue that boosting school funding will lower those costs, but others are not convinced.

One winter day during his junior year at Harlan High School in the Roseland neighborhood, Donte Webb and his buddies left the school building but decided to go back when they got chilly. Upon their return, they were met by an administrator who issued suspensions.

At the end of that school year, Webb left the school building for good. He never went back to Harlan, or any other school, for his senior year. "I got distracted," said Webb, who described himself as a punk of a teenager who smoked weed everyday and didn't really take an interest in school.

His homeroom teacher had told him to get serious about his class work. But he was too wrapped up in "hanging out" to listen to her, said Webb, now 20. "Instead of doing what I should have been doing, I was doing other things."

Webb's wrong turn has cost him clearly. And research shows that it will also cost the rest of us.

In 2005, the "social costs," for nearly 880,000 Illinois residents without a high school diploma or GED, was close to $10 billion, according to one researcher. Those costs include more than $9 billion in reduced earnings and lower state and federal tax contributions. It also includes nearly $1 billion more in expenses for prisons, health care and various forms of public assistance, according to research by Andrew Sum, an economics professor at Northeastern University in Boston.

In January 2002, the Illinois State Board of Education noted that 50 percent of Illinois welfare recipients, at that time, were high school dropouts, and that 30 percent of state prison inmates could not read at a sixth grade level. "The consequences of failing to bring all students to a high level of achievement are significant," the board wrote.

Some scholars argue that it makes more sense to invest in school interventions for children while they're in elementary school and high school rather than paying many times more in social programs and diminished tax dollars once children have dropped out of school. Chicago neighborhoods with the highest percentages of adults without a diploma or GED, particularly some black and Latino areas, bear the brunt of joblessness and poverty, according to an analysis of census data.

Although the exact relationship between school funding and social outcomes is murky, the substantial costs that dropouts generate are clear, according to Henry M. Levin, a professor of economics and education at Teachers College at Columbia University in New York City "Even though many of us may feel that we are unaffected by the massive educational inequities in our society, the facts are just the opposite," said Levin, who has studied the economics of education, including social costs analyses, for almost 40 years. "We all pay for such failure, and the costs are staggering."

According to Sum, by dropping out of high school, Webb is costing himself an average of close to $8,000 a year in earnings--or nearly $355,000 over the course of his lifetime.

Webb said he remained directionless after he dropped out. He tried to find work but was unable to. His low point came when he got caught in a stolen car and landed in Cook County Jail for three long days and three long nights. "That is the worst place ever," he said.

For that offense, Webb got probation.

But the lower wages and higher unemployment rates also result in costs for everyone, according to Sum, director of the Center for Labor Market Studies at Northeastern University.

While dropouts paid an average of $1,761 in state and federal taxes in 2005, graduates paid $4,423--a difference of close to $2,700. For nearly 880,000 in Illinois without a diploma or GED, in 2005, the "losses" totaled nearly $6.65 billion in earnings and $2.34 billion in state and federal taxes.

The costs were not limited to earnings and taxes.

Sum estimated that dropouts collected an average of $2,905 in public benefits in 2005--about $114 more than graduates. These include costs for health programs like Medicare and Medicaid, public assistance, food stamps and unemployment.

In addition, dropouts were more likely to be found in prison and public mental health facilities, according to Sum. He estimated that the average cost for these two institutions was about $1,300 for male dropouts, compared with about $300 for male graduates.

Counting the lost wages and taxes and the additional public expenses in 2005, the price tag for dropouts was a whopping $9.98 billion, according to Sum's research.

Projected over a lifetime, from ages 18 to 64, the "social costs" for each dropout is more than $533,000, according to Sum.

Some researchers have questioned the precision of social cost analyses. But most agree that a diploma could improve the quality of life for most dropouts. "At every level of job, the higher your educational attainment, the lower your level of unemployment and the more likely you are to receive a good wage," said Ralph Martire of the Center for Tax and Budget Accountability, a Chicago-based economic policy think tank.

Wiyvonne Rivers has lived it. It's been more than a decade since Rivers--at 16 and pregnant--dropped out of high school. In the years since, she has worked at numerous places--from fast food restaurants to warehouses to stuffing envelopes in offices. "I have never stopped trying to do better," she said.

But most of those positions paid minimum wage or a little higher, and they were unstable positions. Rivers said she would either get laid off or she'd tire of the jobs and quit.

When she couldn't find work, she'd go on welfare. But making ends meet on public assistance is also difficult. "I get tired of struggling," she said.

Not only are Rivers and other dropouts affected, but so is the state's future economic vitality, Martire said. "To attract better businesses in Illinois, [you have to ask], 'Does the state produce the type of worker that you need?'" he said. "If the answer is, 'No,' the kind of job growth you are going to get is the jobs that pay less and have fewer benefits. One of the reasons is that's the kind of workforce you are producing."

Rivers feels badly that her daughter, now 11, is growing up in the same poverty that she did. She tries to tell her the importance of staying in school. "I tell her to make different choices," Rivers said. "I try to tell her to endure."

Several researchers, including Levin, believe that Illinois can turn things around with greater investments in proven dropout reduction strategies, like Chicago s child-parent centers, dropout prevention programs, smaller class sizes in elementary schools and higher teacher salaries to attract more high-quality instructors.

Levin said research has shown that these interventions lead to higher high school graduation rates and, as a result, a savings in "social costs."

Of these interventions, Levin found that dropout prevention yielded the greatest "savings." Every dollar spent in dropout prevention led to a $3.50 reduction in social costs, Levin said. "Throwing money at the problem is not the solution; it's putting money into targeted strategies that's important."

More of these interventions could be on the way in Illinois.

In October 2006, Gov. Rod Blagojevich launched a task force to focus on re-enrolling high school dropouts. The task force will hold hearings throughout the state before issuing an interim report in January 2007 and a final report in January 2008. And Illinois Senate President Emil Jones Jr. said he would be poised to act on the task force's recommendations. "Many young people are falling off the cliff," said Jones, noting that 62 percent of prison inmates in Illinois are high school dropouts. "Society pays a hell of a price when we do not provide a safety net, when we do not pull them back so that they can become productive citizens in our society."

Darien Haywood, 17, is an example of what can happen when dropouts are pulled back. He now attends Olive-Harvey Middle College, an alternative high school located on the Far South Side.

Thanks to his own efforts and the school's small and supportive environment, Haywood has become an honors student and student council president, with plans to become a plastic surgeon.

Haywood, who began gangbanging and selling drugs when he was 12, is certain that he was headed toward prison or death before the program allowed him to make a U-turn. And there are many others like him, Haywood said. "A lot of them want to take that step, but they're scared to be a leader."

Both Webb and Rivers are taking those scary steps.

They've attended pre-GED and GED classes in an old Hyde Park neighborhood mansion on the South Side. The classes are provided by the Blue Gargoyle, an organization providing education, counseling and employment services among its three South Side locations.

Rivers came to the program, in May, for help with the GED test. For years, she's been taking classes to prepare for the test, but she hasn't passed it.

Webb's outlook changed after meeting a South Side minister, who became a father figure to him and encouraged him to go back to school. Webb now wants to go to college and become a social worker. "He told me that my future would not be too much without an education," he said.

Sara Semelka helped research this article.

THE NUMBERS

Costly Choices

Research shows that high school dropouts have
greater "social costs" than high school graduates
because, on average, dropouts earn less, pay less
in taxes and rely more heavily on public benefits
and institutions. In 2005, the combined costs for
880,000 Illinois residents without a high school
diploma was nearly $10 billion.

                    HS Deposit  HS Graduate

EARNINGS             $15,383      $15,383
TAXES                 $1,761       $4,423
PUBLIC BENEFITS       $2,905       $2,791
INSTITUTIONS          $1,298         $282

Notes: Taxes include state and federal income taxes,
as well as social security payroll taxes and other federal
government contributions. Public benefits include welfare
cash assistance unemployment insurance, Supplemental Security
Income benefits, food stamps, energy assistance, housing
subsidies, veteran's  benefits, Medicare, Medicaid and other
government aid. Institutions includes prisons and mental health
facilities.

Source: Andrew Sum at Northeastern University.

Note: Table made from bar graph.