Is High Unemployment Hurting Kids' Grades?

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A new study from a group of Duke economists finds that large-scale job losses have a negative impact on student test scores, particularly in math. Previous studies have shown how kids whose parents lose their jobs perform worse on tests. This study shows that job losses have a much broader effect, and impact kids whose parents remain employed. Here’s the abstract:

Given the magnitude of the recent recession, and the high-stakes testing the U.S. has implemented under the No Child Left Behind Act (NCLB), it is important to understand the effects of large-scale job losses on student achievement. We examine the effects of state-level job losses on fourth and eighth-grade test scores, using federal Mass Layoff Statistics and 1996-2009 National Assessment of Educational Progress data. Results indicate that job losses decrease scores. Effects are larger for eighth than fourth graders and for math than reading assessments, and are robust to specification checks. Job losses to 1% of a state’s working-age population lead to a .076 standard deviation decrease in the state’s eighth-grade math scores. This result is an order of magnitude larger than those found in previous studies that have compared students whose parents lose employment to otherwise similar students, suggesting that downturns affect all students, not just students who experience parental job loss. Our findings have important implications for accountability schemes: we calculate that a state experiencing one-year job losses to 2% of its workers (a magnitude observed in seven states) likely sees a 16% increase in the share of its schools failing to make Adequate Yearly Progress under NCLB.

It’s a pretty straight line between job losses and the resulting economic impact on a school system: A factory closes, people get laid off, the local tax base is reduced, and the budget for the public school system is squeezed. But when you add in all the other bad stuff that comes with high unemployment, like stress and depression, it’s easy to see how the problem gets compounded. This bit from the study offers a good window:

[I]ndividual changes resulting from community-level job losses could have profound effects on the school setting and on students’ experience in schools. For example, given the findings reviewed above, teachers who remain employed may still experience increases in stress. Higher levels of teacher stress are related to lower levels of student academic achievement, mainly through changes in teacher-student classroom interactions (Wiley, 2000). Relatedly, if students are in classrooms with peers whose parents have lost jobs, the interactions among students within the classroom may be altered, potentially affecting all students’ levels of achievement. Less positive classroom interactions are related to lower growth in children’s academic achievement over time (Hamre & Pianta, 2001; Pianta, Belsky, Vandergrift, Houts, & Morrison, 2008).

The problem appears to be amplified under a system like No Child Left Behind, where funding is tied to test scores. Communities hard-hit by job losses get caught in downward spirals that, combined with the erosion of educational performance and thereby funding, over time can wipe out the economic competitiveness of entire towns and cities.