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From Educating the Individual to Retooling the Nation: The Critical Role of ABE Educators. Bruce P. Corrie, PhD Professor of Economics Concordia University-Saint Paul. 2006 ABE Statewide Summer Institute Saint John’s University Funded by an Otto Bremer Grant. Overview. A New Paradigm

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From educating the individual to retooling the nation the critical role of abe educators l.jpg

From Educating the Individual toRetooling the Nation:The Critical Role of ABE Educators

Bruce P. Corrie, PhD

Professor of Economics

Concordia University-Saint Paul

2006 ABE Statewide Summer InstituteSaint John’s UniversityFunded by an Otto Bremer Grant


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Overview

  • A New Paradigm

  • The Emerging Challenge

  • The Return on Investment in ABE

  • A New Marshall Plan


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ABE Educators: A New Vision

  • You are not just educating the individual

  • You are retooling the nation and Minnesota in our new global competitive economy

  • Your special focus on the low-skilled youth/worker is very critical for the nation’s and the Minnesota’s long term economic security and growth. This critical mass of people in the US and local economy need immediate attention else we will face serious problems in the years ahead.


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A New Vision

  • The nation needs to develop strategies to retool the low wage low skill workforce in the face of global competition.

  • ABE programs play a very important role as they improve the skills of workers and in so doing, increase productivity in the workplace have a number of other social benefits, and raise the standard of living in local economies and national economies.

  • We need a new Marshall Plan to invest in this disenfranchised population.


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Overview

  • Next slides will present

    • Data on the number of low skilled workers

    • Data on the declining need for low skilled workers in the USA by our firms

    • Data on the challenges of an important pool of future workers in MN – immigrants and minorities

    • Data on the effectiveness of ABE in meeting the challenges of our future workforce

    • Data to illustrate how investing in our emerging workforce through ABE programs help to strengthen the economic base in MN.


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The Challenge

  • 1.9 million workers with wages at or below $5.15 an hour in the US

  • 561 thousand without a high school degree

  • 547 thousand high school without college

  • 62, 800 thousand in Minnesota

  • Source: CPS 2006, Census 2000 from DEED data for MN.


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Challenge MN

  • In Minnesota, 30 percent of all workers or over 800,000 workers are low-wage workers. The proportion of low-wage workers in Greater Minnesota varies from a low of 35 percent in the Southeast region to a high of 46 percent in the Northwest Region. (Less than $10 an hour)

  • http://www.deed.state.mn.us/lmi/publications/wagedist/98_00/region.htm


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Who are low wage workers?

  • Are disproportionately - Young, female, minority, with a high school degree or less and with health limitations

  • Characteristics of Low Wage Workers and their Labor Market Experiences. http://aspe.hhs.gov/hsp/low-wage-workers04/ch7.htm


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Challenge: Employers want higher skills

  • Large study which included Minnesota found employers reduced employment shares of low skilled workers and increased shares of high skilled workers in virtually every industry.

  • Found a continuing up-skilling of the work force

  • John Abowd, Paul Lengermann, Kevin L McKinney (2003), Measurement of Human Capital in the U.S. Economy. US Census, LEHD Program.


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Challenge: Firms Need High Skills to Increase Productivity and Grow

  • Found that quality of the Human capital of the firm determined productivity and market value of the firm.

  • Bowd J.A. et al (2002) The Relation among Human Capital, Productivity and Market Value: Building up from Micro Evidence. US Census, LEHD Program


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Challenge: MN Population Crisis and Grow

  • According to both the MN State Demographer and the MN State Economist, MN is going to rely increasingly on migration to meet its labor needs because of an aging population.


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Minorities/Immigrants – Increasing share of the Prime workforce 2005-2030

Source: MN State Demographer Population Projections


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Minorities/Immigrants – Increasing share of the Tax Base workforce 2005-2030

Source: MN State Demographer Population Projections


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Minorities/Immigrants – Increasing share of the workforce Emerging workforce 2005-2030

Data from MN State Demographer Projections


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Many Minnesota Students Have Low Human Capital workforce

Source: Minnesota Minority Education Partnership, 2006


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Many Minnesota Students Have Low Human Capital workforce

Source: Minnesota Minority Education Partnership, 2006


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Human Capital of Minnesota workforce

  • % Adults with no high school degree 9 %

  • % Adults with high school degree 29 %

  • % Adults with some college degree 32 %

  • % Adults with college degree or higher 30 %

    Source:http://www.nccp.org/pdf/state_detail_context_MN.pdf


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The Global View on Skills workforce

Source: Pathways to Labor Market Success. ETS, 2004


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Role of ABE in Retooling MN workforce

  • GED

  • ELL

  • Worker Training

  • How effective are these programs?


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Impact of GED workforce

  • Leads to increase in earnings for high school dropouts with weak skills (36 percent for 27 year olds)

  • Returns for postsecondary training is as high for GED as for traditional high school graduates

  • Many other benefits such as increased literacy skills, more self confidence, better life skills.


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Impact of Schooling on Crime workforce

  • High school graduation rates results in a 0.8 percent reduction in the probability of incarceration from Whites and a 3.4 percent reduction for Blacks.


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Impact of Schooling on Crime workforce

  • One additional year of schooling reduces:

    • Arrest rates by 11 percent

    • Murder and assaults by 30 percent

    • Motor Vehicle Theft by 20 percent

    • Arson by 13 percent

    • Net Benefit of $1.4 billion to the nation

    • (However, increased rapes and robbery)

  • Lance Lochner and Enrico Moretti, The Social Savings from Reducing Crimes through Education. Joint Center for Poverty Research http://www.jcpr.org/policybriefs/vol4_num5.html


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Impact of Schooling on Children in Poverty workforce

  • From 1984 to 2004 the number of children in poverty increased from 66 to 75 percent for families with parents with less than high school education

  • It rose from 36 to 45 percent for parents with a high school diploma

  • It remained at 17 percent for families with some college education

  • National Center for Children in Poverty: http://www.nccp.org/pub_pei06.html


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Literacy Proficiency and Employment workforce

Higher Proficiency = Lower Unemployment

Source: Pathways to Labor Market Success. ETS, 2004


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Prose Proficiency and Education workforce

Higher Education = Higher Literacy Proficiency

Source: Pathways to Labor Market Success. ETS, 2004


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Quantitative Proficiency and Earnings workforce

Higher Quantitative Proficiency= Higher Earnings

Source: Pathways to Labor Market Success. ETS, 2004


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Immigrants, Lit Proficiency and Earnings workforce

Higher Literacy Proficiency = Higher Earnings

Source: Sum et al (2002). ETS


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Premium for Speaking English workforce

Source: Sum et al (2002). ETS


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Reasons for Taking GED workforce

Source: National Adult Literacy Survey, 2005


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Reason for Taking ELL workforce

Source: National Adult Literacy Survey, 2005



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Returns to Schooling workforce

  • Barrow and Rouse (2006) using data from the Current Population Survey find that each additional year of schooling results in a average increase in earnings by 11 percent


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Immigrants workforce

  • Each year of schooling completed by an immigrant adds 6.2 points to their predicted composite literacy proficiency score.

  • The earlier one began studying English, the higher his/her predicted proficiency score.


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Education and Living Standards workforce

  • According to the Economic Report of the President, 2006, studies have shown that during the period 1950-1993 one third of the economic growth in the country was due to increased levels of education


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Higher Education = Lower Unemployment workforce

Source: 2006 State of Students of Color. www.mnmep.org


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Higher Education= Higher Income (US) workforce

Source: 2006 State of Students of Color. www.mnmep.org


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So You Want to Be a Millionaire workforce

LIFETIME EARNINGS BY EDUCATIONAL LEVEL (Day & Newburger, 2002)


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Retooling of Minorities in MN Adds to the Economic Base of Minnesota

  • More productive Workers

  • Expands the consumer Base

  • Increase Entrepreneurship

  • Builds Cultural Capital

  • Makes us competitive in the Global Economy


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Consumer Base Minnesota

  • According to the Selig Center Buying Power of minorities and immigrants is an estimated 12 billion dollars.

  • This is greater than the GDP of 90 countries in the world

  • Higher skilled workers will have higher earnings and expand their consumer power in Minnesota


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Workers Minnesota

  • Minorities and immigrants are overrepresented in both the high skilled as well as low skilled occupations.

  • Improving the skills of these workers will add to the productivity of Minnesota



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Asian and Latino Workers Minnesota

High Tech

  • Medical Scientists

  • Physicians and Surgeons

  • Chemical Engineers

  • Postsecondary Teachers

  • Computers and Electronics

    Low Tech

  • Food Preparation, processing

  • Roofers

  • Dining room and Cafeteria attendants

  • Maids and Housekeeping Cleaners


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Minority/Immigrant Firms Minnesota

  • 22,405 minority firms in Minnesota

  • with $2.7 billion in sales.

  • 3497 of these firms had employees

  • employing 31, 474 people

  • with an annual payroll of 819 million dollars.


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Minority/Immigrant Firms Minnesota

  • Minority firms in Minnesota grew by 44 percent during 1997-2002 as compared to a growth rate of 8 percent of all firms.

  • American Indian firms were 13th in the nation in terms of growth of firms during the same period.



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MN – Integrated with the Global Economy 1991 & 2005)

MN Rank2003, 2004

  • Export Volume, 2004 20

  • Exports (Latin & S. America) 25

  • Exports (Asia) 15

  • Exports as Percent of GSP 23

  • Employment (Foreign Companies) 22


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Cultural Capital is Important for Minnesota 1991 & 2005)

  • Richard Florida and the rise of the Creative Class

  • New case for diversity – brings creativity into an organization

  • Minority food, art, culture, music, ideas, theatres adding vitality to Lake Wobegon


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Summary 1991 & 2005)

  • The nation needs to develop strategies to retool the low wage low skill workforce in the face of global competition.

  • ABE programs play a very important role as they improve the skills of workers and in so doing, increase productivity in the workplace and have a number of other social benefits.

  • Investing in Minorities and Immigrant communities will yield positive returns in the long run

  • What we need is a new Marshall Plan to retool the nation’s low wage low skill workforce



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Characteristics of GED Population 1991 & 2005)

National Adult Literacy Survey, 2005



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Characteristics of GED Population 1991 & 2005)

National Adult Literacy Survey, 2005


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Characteristics of GED Population 1991 & 2005)

National Adult Literacy Survey, 2005



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Bruce P. Corrie, PhD 1991 & 2005)

Concordia University

Saint Paul, MN 55117

[email protected]

Tel: 651 641 8226







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