Recession doesn't change students' economic savvy
WASHINGTON — The Wall Street meltdown of 2008 and the ensuing recession did little to help make high school seniors financially savvy and less than half of them have a solid understanding of economics, according to an Education Department report released Tuesday.
In real terms, that might mean that students might have difficulty understanding the impact of a poor credit rating, the relationship between consumer spending and higher unemployment or how inflation can eat away at pay raises.
Students' scores of economic literacy changed little between 2006 and 2012, suggesting that the national discussion about the millions of jobs that were lost and homes that were foreclosed didn't translate to higher academic achievement. During that period, several states added an economics course to high school offerings and some started requiring it to earn a diploma.
“It is astonishing that high school seniors do not know more about how economics affects their wallets, their country and the world at a pivotal time in their lives, whether they choose to enter the workforce or pursue higher education,” said David Driscoll, chair of the National Assessment Governing Board, which runs the federal tests. “We need to do more to educate all students in economics so they can make informed decisions, whether they are negotiating a car loan, voting or reading financial news.”
The findings show that more than half of students leave high school without an economic knowledge that federal officials consider proficient. In 2012, 39 percent of students had a basic understanding of economics while 18 were considered below basic.
“This is exactly what I would have expected,” said Annamaria Lusardi, a distinguished scholar at George Washington University who on Wednesday testified to a Senate subcommittee about students' economic skills.
“Financial literacy is like every topic; they don't learn by osmosis. Just because you read The Wall Street Journal, you're not going to learn about interest compounding,” Lusardi said.
About 10,900 high school seniors at 480 public and private schools took the economics test as part of the 2012 National Assessment of Educational Progress, more commonly called “the nation's report card.”
Overall achievement on the tests was flat since 2006, when the economic questions were first asked. For all students, the average performance shifted from 150 to 152 on a 300-point scale.
“The overall scores for the two assessments were not significantly different,” said Jack Buckley, commissioner of the National Center for Education Statistics, part of the Education Department's research arm.
But among Hispanic students, performance rose, narrowing the gap between their scores and those of their white classmates.
Buckley suggested Hispanic students' uptick might be because of higher reading skills that are documented in other part of the national exams.
Students from private schools performed better than those at public schools, while males scored higher than females.
Since the 2008 economic crisis, education officials have added economic instruction to their classrooms. In 2004, only 16 states required economics to be offered to high school students. That number rose to 25 in 2011, according to the Council for Economic Education's survey of states.
And in 2004, only 14 states required students to take such a class. That number jumped to 22 in 2011.
During the 2011-12 academic year, all 50 states and the District of Columbia included some form of economics in their curriculum between kindergarten through high school graduation, the same survey from the professional organization found.
Just because the requirement is on paper doesn't mean it's reaching the classrooms, cautioned Nan Morrison, president and CEO of the Council for Economic Education. “It's not just being taught widely enough and deeply enough,” she said.
Morrison said much of the education that followed the 2008 meltdown focused on helping students calculate interest payments and other real-world examples but didn't address the broader theories that move economies.
“With the financial crisis, people have become very focused on mechanics. But it's a bigger story than that about making decisions,” she said. “The pendulum swung toward helping people fix a few specific things but not the big picture.”
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Gasoline prices down nearly a dime in Pittsburgh area
- Alpha Natural Resources executive resigns amid restructuring
- Shale gas violations down as DEP steps up inspections
- Allstate patents driver analysis
- Trib Total Media puts 9 Western Pa. newspapers up for sale
- ‘Rank and yank’ doesn’t meet all expectations
- Regulators expect lawsuit over oil, gas rules process
- Macy’s prepares outlet stores
- Fund fees within investor control
- Bonuses on the rise, but fewer workers receive them, survey shows
- Clean Air Council challenges Sunoco Pipeline’s public utility status