The impact of our educational system on our economy is huge. A study by McKinsey on the economic impact of our educational system’s dysfunction put it this way: if we had fixed the problems in our educational system by 1998, reclaiming our position as the best, most educated nation in the world, our GDP in 2008 would have been between $1.3 and $2.3 trillion higher (real GDP that year was $12.88 trillion). Cumulatively, the achievement gaps between the US’s educational system and other developed nations have produced more lost economic productivity than all of the recessions since the 1970s – and the education gap will continue to hinder us for another generation, even if we fix our schools now.
The single biggest long-term drag on our economy is the large and growing portion of our population that lacks the skills and education to do work that is competitive in the world marketplace. As the McKinsey authors and many others have made clear, we are depriving ourselves of literally trillions of dollars per year by not addressing this problem. The annual cost to fix it would be much, much less than the cost of ignoring it.