Dollars and Schools: Resource Development

By Stuart. Rosenfeld

Vol. 10, No. 3, 1988, pp. 12-14

Today, attitudes toward education have changed--though not necessarily for altruistic or philosophical reasons--from the traditional view that human resource development meant higher priorities for training than for education. Education still responds to the needs of the private sector and economics. The difference now is that the educational demands of jobs have risen and require more conceptual skills. It's competitiveness that's pushing interest in education today, despite debate about whether work is going to require greater or less skill and knowledge, whether technology will skill or de-skill jobs. But the reality of the impact of technology doesn't affect education in the South as long as the accepted view of educators and employers is that more skills and knowledge, not less, will be needed.

Four key education issues in the South are: adult literacy; elementary and secondary school expenditures; vocational education; and blacks in graduate education.

Adult Literacy

The strongest and most specific recommendation of the Commission on the Future of the South was to reduce rates of adult literacy significantly by 1992.

FIGURE 1 reflects education in the past, the rates of adult illiteracy in the South. The measure is of the number of adults who had not completed eight years of education at the time of the 1980 census. Nonmetro rates are nearly twice the metro rates in many states. And if you think that it doesn't affect jobs, look at FIGURE 2, the relation to unemployment rates. Those counties with the highest rates of functional illiteracy had the highest unemployment and those with the lowest, the lowest unemployment rates.

It would seem that there is an all-out war on illiteracy. Every Southern state except Alabama has a special task force or commission on literacy. But much of what is happening is still a war of words. The level of resources, is not nearly at the level of attention. It's a good start but only a start. The federal government spends only $100 million on all adult education, or $3 for every adult with less than nine years of education. States are increasing their funding. But in most states, the total annual funding is still less than the average annual expenditures in just one medium-sized, medium-wealth school district.


It's true that more money won't necessarily improve education, but its hard to have good schools with insufficient resources, and its not fair when some children get much more enriched educational environments than others. There are two issues here.

One is interstate disparities. Some states spend less than others either because they are poorer or because they place less value on education. Historically, Southern states' spending was at the bottom nationally for both reasons--they were poorer and made less effort.

As FIGURE 3 shows, Southern states still spend less for education than most other states, about 20 percent less in 1985. It's only that high because Florida, the most populous of Southern states, is above the national average. Alabama, Arkansas, Mississippi, and Tennessee all spent at least 30 percent below the national average.

But there's more to those numbers than meet the eye. They consist of revenues from local, state, and federal sources. Federal funds, however, are mostly targeted to special needs and are not available for the core educational program such as teachers' salaries, supplies, or facilities.

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Southern states have more children from low-income households and with special needs and thus get more federal money than states in other regions. Removing the federal resources brings the Southern states even farther from the average of the non-South.

The Commission on the Future of the South recommended a 25 percent spending increase in 1986. Low taxes are no longer a major inducement to industry if the result is poor schools. The fastest growing states today are the highest taxing states. George Bragg, president and CEO of Telex Computer Products in Oklahoma, told the annual meeting of Southern Legislators last summer, "Many states make the mistake of assuming that a low tax base will encourage companies to come and stay. You get what you pay for, and I would encourage you to think more about the quality of services--which may mean higher taxes."

The other issue is intrastate disaparities [sic] . Beginning in the late 1960s, families of students who were getting shortchanged by the education system--getting poorer quality education--went to the courts claiming that the state owed all of its students roughly equivalent educational opportunities.

FIGURE 4 examines ten Tennessee districts to show the extent to which disparities still exist. Here are last year's per pupil expenditures in the five districts that spent the most and the five districts that spent the least. The high spending district is nearly twice the low spending district. The per capita incomes of these ten school districts are just what you'd expect. The differences are not extreme, but there is an obvious relationship between wealth and educational revenues. The 1986 Commission on the Future of the South made recommendations here, too, suggesting state equalization formulas to balance the disparities among districts.

Bear in mind that these per pupil expenditures include federal funds. The federal share is about twice as high in the poorer districts, but those funds are earmarked for special purposes, not for the normal costs of education. Remove the federal share and the ratio of spending is much more than two to one.

But federal spending for education is declining in real dollars. Between 1980 and 1986, federal spending for Chapter 1, compensatory education, the largest program, decreased by 23 percent and served 500,000 fewer students. Bilingual education decreased by 47 percent and education for the handicapped decreased by 11 percent. Moreover, in all the states improving education in the past few years, there were almost no major reforms addressing special needs. The Committee for Economic Development, in its report Children in Need, stated that a dollar spent today to prevent educational failure will save $4.75 in future costs to society.

Vocational Education

For two decades, vocational education has been the accepted link between education and economic development, the aspect of education that was included in the old business climate indices. States have played to industry and subsidized training to recruit industry. In a case study of a new plant site in rural Kentucky I asked the CEO whether the many training subsidies were a factor. He said, "Not at all. I can get them anywhere. The form may vary a bit from state to state, but everyone is doing the same thing." In other words, the subsidy no longer matters unless you don't provide it. But a good vocational education program that combines technical and occupational skills with sound basic education is an important part of public education, both to the student and to the community.

One effect of the link between vocational education and economic development in the 60s and 70s was that the Economic Development Administration and the Appalachian Regional Commission stepped in to support vocational education facilities. It's a little known fact that the two agencies invested well over a billion dollars in vocational education facilities, much of it in depressed rural parts of the South.

Vocational education in the South has great opportunities and room for exciting and positive changes. States are rethinking their high school programs and making them more academically challenging and less occupationally specific. And the two-year technical colleges are upgrading and improving their degree programs and becoming more imaginative in supporting technology transfer to existing manufacturers, small businesses, and local development in general while also providing community services including literacy programs. The community and technical college no longer simply recuits [sic] factories and provides subsidized, customized training. It has become a community focal point

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for retraining and for economic development.

The federal government plays a small but crucial role in vocational edudcation [sic] . Federal funds are just under 10 percent of the total, but their uses are important. Most are targeted, 22.5 percent to disadvantaged students, 10 percent to handicapped, and smaller amounts to women reentering the labor force, displaced workers, and others. Many would not get the special services they need without the earmarked funds. The rest must be used for program improvements, in some ways that make voc ed better than it was before, and can't go into the operating budget. The federal voc ed funding is the oldest support for elementary and secondary voc ed, going back to 1917. In 1986, the Reagan administration recommended zero funding.

The Commission on the Future of the South was quite specific in its desire to support vocational education but to revamp high school vocational education and to transfer much of the responsibility for job-specific education to the two-year colleges.

Higher Education

A critical issue is the inability to improve black enrollment in graduate schools, especially in the sciences and engineering. Blacks are no longer increasing their enrollments in higher education and are still very unrepresented in graduate schools. Only a limited number of universities contribute to the small pool of black degree recipients in the sciences.

FIGURE 5 shows the change in the percent of blacks enrolled in Bachelors, Masters, and PhD programs in the South. The percentages of Bachelors and PhDs are down slightly from ten years ago, but the percent of Masters degrees is way down. FIGURE 6 shows black and female enrollments in the sciences. About 45 percent of the advanced degrees of blacks in the sciences are from the traditionally black colleges in the South.

These trends are important because technology playing a bigger and bigger role in the economy and it's the scientists who are becoming the entrepreneurs and controlling more of the capital. The latest occupational demand projections by the Bureau of Labor Statistics shows a large anticipated increase for technicians, engineers, and scientists, while the programs into which minorities have been going, the social sciences and human services fields, are declining.

Much of the cause is attributed to the quality and quantity of high school math and science preparation. Fewer blacks are taking four years of math and science. That relates to the quality of inner city schools and to the counseling and curriculum advice blacks get in school. Later the admissions practices at colleges and availability of financial aid affect enrollments.

It's not hard to find the federal responsibility in all this. It goes back to support for compensatory education, to providing access to better schools, end to sufficient financial aid for higher education.

The Commission on the Future of the South recommends that the states assume some responsibility by expanding scholarships for minorities, disadvantaged, and rural students and providing more remedial education to college-bound students. The committee on technology and innovation was even more specific, recommending that each state create and fund a Top Scholars program for math, science, and technology and identifying and selecting qualified women and minorities.


It's not enough to raise averages of measures of educational quality. Equal opportunities are equally important, and the pot of federal dollars, as small as it has been, has been directed at equity and is far more important than its size indicates.

Stuart Rosenfeld is director of the Southern Technology Council of the Southern Growth Policies Board This article is adapted from remarks he made at the annual meeting of the Southern Regional Council in November 1987.