We support providing federally funded, online, GED training programs to raise the percentage of the population with a high school degree or equivalent. We also support making unemployment compensation, food stamps, and minimum wage eligibility contingent on having a high school degree or passing these exams. For those who fail to meet the educational requirements, the benefits would be in the form of a loan rather than a grant. Those failing to meet the educational requirements would be subject to lower minimum wage, that would take precedence over state minimum wage laws.
We support state level programs for expanded vocational training in high schools, coordinated with local employers to ensure that the training produces employable skills. We support federally funded post-secondary training programs also coordinated with employers to ensure that the programs produce employable skills. Employers would be entitled to a tax credit for providing the training, provided that they employ the individuals after the training.
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Even if the United States were to match the most successful countries in graduating students from four-year colleges and universities, a significant percentage of U.S. students will be left to find employment without a college or even a high school degree.
High School Dropouts
At the moment, about 31% of U.S. students don’t even get a high school degree with their cohort group. Roughly 60% of those who drop out get a high school degree or General Education Degree, GED, within eight years of their normal graduation age. This leaves about 13% of the potential workforce without the equivalent of a high school degree.
The degree of competence in reading, writing, and mathematics required for getting a high school degree or GED is absolutely essential to be employable in the modern world at anything other than minimum wage work.
In the event that those without a high school degree, or its equivalent, are lucky enough to find work that pays a decent wage, they will be vulnerable to losing it, and to becoming unemployable because they lack the necessary reading, writing, and math skills to allow them to be retrained for other work.
America already spends substantial funds on K-12 education, even in the worst funded school districts. The average per pupil expenditure is about $12,600. The range is from around $9,000 (Idaho) to around $29,000 (Washington, D.C.) (1) There is no reason why we should not be able to match the roughly 93% high school graduation rates of other countries like Belgium, Finland, Japan, New Zealand, Norway and Poland.
The GED tests are available on line (in most states) and in person and costs range from 0 to $40 per test for the 4 tests required. (2) Some states offer the HiSet exam rather than the GED for similar range of prices. (3)
Preparation materials for the GED are already widely available at major book stores, libraries, and online. We would support a refundable tax credit for the cost of online or in person GED preparation programs. Computers are available at public libraries, for students without access to a computer. As an alternative to public library computers, very low cost tablet computers now exist that can be rented or loaned out to students. For students with insufficient reading skills to take advantage of these programs, we would support federally funded adult literacy classes.
As an incentive to take and pass the exams, we would make unemployment compensation available only as a loan to anyone who either did not have a GED or a regular high school degree. The loan would be forgiven when the student successfully passes the GED. We would also make the cash value of Food Stamps for this group a loan, if no adult member of the household is employed. The amount of the loan for Food Stamps would also be forgiven when they successfully take the GED exam. If the recipient becomes employed before passing the GED, they would be granted a grace period to complete the GED, during which time no interest would be charged on the loan.
Students who were unwilling or unable to finish high school or take and pass the GED could still have their loans forgiven, if they were willing to forgo eligibility for the minimum wage. Alternatively, this group could accept eligibility for a lower federal minimum wage, of say $5 per hour, that would preempt local minimum wage laws. Arguably, this group of people remains unemployed because their labor is not worth $7.25 an hour and they are actually being harmed by the minimum wage. Exempting this group from the minimum wage, or setting a lower minimum wage for them, should help to lower their unemployment rate and increase their degree of labor force participation. They would immediately be eligible for the regular minimum wage, when and if they passed a GED exam. If they were applying for a minimum wage job, they would be required to inform their employer of their minimum wage status, if asked.
We believe such a program would quickly get the U.S. above the 90% level for high school graduation or a GED. This is especially true because so many of those on unemployment compensation lack a high school degree. The unemployment rate for high school dropouts is around 14%. This rate would be significantly higher were it not for the fact that 54% of this group does not even participate in the workforce as either employed or unemployed and looking for work.
This proposal may seem unduly harsh to some people but, since everyone in the U.S. is provided with an opportunity for a free high school education and since we would be providing a free GED preparation course for those who wanted it, it seems only fair to us. We are simply asking that those people, who are not mentally disabled, take advantage of these publicly funded opportunities, if they want to be eligible for publicly funded benefits. The absolute worst outcome would be that those who were not willing to take, or could not pass, a GED exam would end up without minimum wage protection, or with a lower minimum wage. It is probable, in our view, that this group is ill served by minimum wage protection. The upside is that a significant proportion of the hard core unemployed would become more employable either because they now have the equivalent of a high school degree or because they are less expensive to employ.
Students Who Graduate High School but Do Not Want to Get a College Degree
As of 2019, 36% of the population over 25 had a bachelors degree or greater. About 58% of those who start college finish in six years. The group of those choosing not to finish college includes Bill Gates and the late Steve Jobs, but it also includes a large number of people with higher unemployment and significantly lower compensation than their college graduate peers.
We believe that with improved efficiencies and lower costs in higher education, a significant number of this group would go on to get a college degree, perhaps raising the percentage with college degrees to 40%. This would still leave about 60% of the population with less than a college degree.
Some of these people will find their own niche and have successful careers. Many of them will struggle to find work that has the potential to support a middle class lifestyle. As a society, we do very little to prepare these students for the workplace. We need to do more.
We would support re-instituting vocational education in high schools, with a focus on 21st century jobs. To do this successfully, high schools will need to coordinate their programs with local employers. We need to bridge the gap between high school and on-the-job training.
For example, hospitals and extended care facilities hire substantial numbers of people with less than a college degree. Programs should be created that would result in a high school degree and some kind of professional health certification in a combined four or five year program. This would certainly be feasible for nurses aide training and a variety of other jobs for which some kind of professional certification would be useful to employers.
Post-Secondary Vocational Education and Training
The most effective form of vocational education is on the job training. Unfortunately, employers are often unwilling to hire and train inexperienced workers because they may move on after being trained or have to be compensated for staying.
We would propose giving employers who hire and train inexperienced workers a temporary waiver on the minimum wage. The program would only apply to workers who are new to the workforce or who have been unemployed for an extended period of time.
For-Profit Post-Secondary Vocational Education and Training
A significant amount of post secondary vocational education and training is now being conducted by for-profit institutions. This education is often supported by Federal Pell Grants and Federal Student Loans. We do not oppose the use of this money for this purpose. However, consistent with our position on the regulation of consumer loans through clear disclosure, we believe that these institutions should be required to maintain data on students success rates in terms of employment and future compensation. We believe that students applying for these grants or loans should be presented with this information and information on the nature of their expected loan repayment obligations. With this information, we believe that prospective students would be able to make informed judgments about the value of taking on this debt.
We support the same kinds of disclosure for students receiving Pell Grants or federal student loans to attend non-profit institutions.