The paradox of education system in the US

The higher educational institutions of the US rank exceptionally high in international comparisons but school education has long been struggling with acute challenges. It doesn’t mean that the higher education system is without any flaw. Student debts, for example, have risen to the level of $1.3 trillion for approximately 44 million borrowers. The phenomenal increase in university dues in the last couple of decades can best be characterised as “moral hazard” and “free rider” problem.

A clean check (of student loan) for a college degree for almost everyone, anywhere in the US encouraged many students to go for it who did not qualify and universities made enormous money by increasing fees and admitting those students. Fraudulent cases of for-profit higher education institutions increased enormously during the last few decades. It was reported last month that the Obama administration forgave student loan amounting to $558 million against 28,000 students. Many such cases were approved earlier under the “borrower defence” statue and still a considerable number of such claims is pending. The quality of education, no doubt, in higher educational institutions is high but still many issues relating to diversity, access, research relevance and teaching practices need to be addressed.

However, school education system is facing more grave challenges. The quality of the school and college education provided impetus to labour productivity growth in the US during first three quarters of the twentieth century. With the vanishing of 7 million manufacturing jobs since the 1980s and automation of numerous services jobs, school education has lost relevance for employability. The modern blue-collar jobs in manufacturing and services sector require a relevant skillset and a good orientation to Science, Technology, Engineering, and Mathematics (STEM). This is probably evident in the labour market trends.

In a recent paper, where have all the workers gone? Economist Alan Krueger cited: “young men who did not work at all over the entire year rose from 10 percent in 1994 to more than 20 percent in 2015”. These are mostly having no college (4 years undergraduate) degree. It is safe to assume that many of them were unable to find a job with school education (K-12 or lower). During the World War II, the focus of school education was to provide employable technical and professional skills which enabled school certificate holders to get reasonable blue collar jobs and it gave significant impetus to economic growth and productivity. However, the momentum was lost after the 1950s. The latest ranking of the Programme for International Student Assessment revealed below average performance of US school students in math and science. And it was even lower than few Asian nations.

Federal funding and state initiatives are sponsoring technical and professional education but the size and efficacy are still limited. The resource constraints and stigma associated with technical education both have contributed to slow growth in technical and professional education at school level. The book, Reskilling America, by Katherine S Newman and Hella Winston, reported that the Department of Education spent $1.75 billion for the career, technical and adult education out of total received federal funds amounting to $67.3 billion in FY 2014. They remarked, “The United States was a mighty industrial power in the past and could be once again, but not until we find it in ourselves to respect what workers produce as much as we admire lawyers, doctors or Silicon Valley computer wizards.”

The need for more quality workers can be judged from the automotive production in the US. In 2016, the automotive sector produced 12 million vehicles with 214,000 workers while they produced 9 million vehicles with 260,000 workers in 1990. The manufacturing sector is reviving after the crisis of 2008 with better investment in automation and capital intensive investments. They can easily find engineers from home or abroad but face tremendous difficulty to find trained workers who can work with hand and head.

When students from around the world flock to the US for higher education, the US itself is increasingly looking towards other countries for technical and professional education. Michael Froman delivered his last speech in January 2017 as US Trade Representative and specifically mentioned Singapore’s Skills Fortune Programme, Korea’s focus on scientific and technical skills, Australia’s competitive system of worker placement, Germany’s apprenticeship, and labour union job support programmes in Scandinavian countries to draw lessons.

The school-choice and local financing of schools appear a cool idea on paper but it has embedded inequalities in school education in the US. Well-off people flock to areas where school ratings are higher and thus contribute higher taxes towards school financing—making it easier for the already better schools to recruit high-quality teachers and to provide other sophisticated teaching aids. Success creates further success! It has led to a concentration of low-income students in inner-city schools and well-off students in the suburban, charter or private schools.

An overarching reform of the school system needs to be carried out, however, bipartisan support for this effort appears out of sight at the moment.

Published in The Express Tribune, February 28^th, 2017.

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