How Important is Education for Economic Growth?

Alexies, a recent graduate of Círculos, an XQ school in Santa Ana, CA, felt a…

By Anna Sudderth

Alexies, a recent graduate of Círculos, an XQ school in Santa Ana, CA, felt a strong sense of belonging at school. The community was kind and accepting, and helped the young student feel like her voice mattered, both within the school and within the city at large. Through Círculos’s project and place-based learning curriculum, Alexies pursued meaningful projects in her community during high school, fostering a desire to take what she was learning and apply it to solve the problems in the community around her. For example, she conducted a research project on mental health challenges faced by students whose parents faced deportation. Alexies contributed solutions to a real challenge in her community. She also built her own confidence and skills and discovered a passion for public health. 

Alexies’s story illustrates high school’s role in setting up both students and communities for economic success. When high schools partner with the community, students contribute to real challenges, revitalizing economic opportunities for the community as a whole. And, through these hands-on learning experiences, students gain the career and academic skills they need for future economic success.

At Círculos, educators use curriculum design to interrupt the structures that isolate low-income communities of Orange County from economic opportunity. Their example shows how understanding the relationship between education and economic growth is key to investing in and innovating high school moving forward.

The Relationship Between Education and Economic Growth

Decades of research confirm that increased investment in education leads to increased economic growth. This includes higher salaries for individuals, greater workforce effectiveness, and higher gross domestic product. 


Principles in Practice: Start making change today with the XQ Design Principles rubric.


This relationship between education and economic growth is evident on a large scale. According to an XQ report on the future of work, increasing student achievement will add $70 trillion to the GDP over time. Looking at data from the United States, The Alliance for Excellent Education found that increasing high school graduation rates would lead to dramatic increases in:

  • New jobs
  • Gross domestic product
  • Annual earnings
  • Annual spending
  • Federal tax revenue

A study from The Learning Agency teases out the relationship between education and economic growth one step further, examining the economic impact not just on high school graduation rates, but on the skill level of graduates. Their findings show that increases in math, reading, and writing skills correlate to significant increases in salaries. What’s more, these higher-skilled workers are more effective in their jobs—leading to increased innovation and productivity, which benefits the economy as a whole. 

The positive correlation between education and economic growth continues to track beyond high school and into postsecondary outcomes. Two studies from the Brookings Institute illustrate this relationship. First, a college degree in any major is crucial to increasing a person’s earning potential. Second, the economic gains of postsecondary education aren’t limited to individuals. The Brookings Institute found that the average bachelor’s degree holder contributes $278,000 more to local economies than the average high school graduate through direct spending over the course of their lifetime, and an associate degree holder contributes $81,000 more than a high school graduate. 

Together, these studies show the strong positive impact of education on economic growth. They also point to three specific areas for how high school education, in particular, affects the economy. Economic growth happens when:

  • High school graduation rates are high
  • High school graduates possess career-ready skills
  • High school graduates go on to complete postsecondary education

High School and The Economy

For many students, high school is a pivotal opportunity to get the skills they need for postsecondary and career success. As XQ Co-founder and CEO Russlyn Ali explained, “Research now shows that adolescence is a pivotal phase for brain development, making it an optimal time to help young people shape their intelligence, identity, and personality.” 

Students’ high school experience often determines whether or not they will:

  • Receive their high school diploma
  • Pursue college or another postsecondary credential 
  • Possess the skills and confidence to navigate the professional world of the 21st century

Currently, traditional high schools in the United States do not do enough to ensure that all students meet these outcomes. 12th grade results from the 2019 National Assessment of Educational Progress (NAEP) in science, reading, and math show that high schoolers in America are, as a whole, not graduating with the skills they need to succeed professionally after high school. The gaps were made worse by the pandemic, especially for the most vulnerable students. A study from the Organisation for Economic Co-operation and Development spells out the relationship between pandemic learning loss and economic outcomes: K-12 students impacted by school closures may expect some three percent lower-income over their lifetimes, and on a national scale, annual GDP may be an average 1.5 percent lower for the rest of the century.

At XQ, we’ve chronicled the gap between the preparation high school students need to succeed in the 21st century workforce and the preparation they actually receive. We want to close this gap. By investing in high school transformation around the demands of the future economy, we have the opportunity to rethink high school to set up all students for successful careers and contribute to economic growth on a large scale.

How High School Education Helps Economic Growth

To succeed in the 21st century job market, high school students need to graduate with more than academic knowledge. They need the skills, confidence, and creativity to meet the challenges of a changing world. Our XQ Learner Outcomes embody these skills through six competencies, including “Original Thinkers for an Uncertain World” and “Learners for Life.” And our XQ Design Principles provide a roadmap for how to design schools that teach these competencies to all learners.

Across the country, XQ schools put these design principles to work. Their success demonstrates how high school education can spur economic growth by empowering students from all backgrounds to graduate college and career ready.

How Can High School Prepare Students for the Workforce of the Future?

High school is a crucial opportunity to prepare students for the jobs of the future—even those jobs that don’t yet exist. Daniel Allen, former executive director of school renewal with the Santa Ana Unified School District, explained, “The economy right now favors the weird; favors the new; favors the out-of-the-box thinkers.” 

High school can set students up to succeed in this economy—and contribute to economic growth—by investing in curricula that prepare students to solve real-world problems. Moving away from the traditional high school model of memorization and standardization, high schools can instead train students to tackle complex projects, collaborate with others, and guide their own learning.

One powerful example of an innovative, career-minded approach to learning is STEAM curriculum. STEAM expands on the familiar learning acronym of STEM—Science, Technology, Engineering, and Math—to introduce Arts into the equation. Through STEAM learning, students combine hard skills with learning to think critically and creatively, just as they’ll need to do in real-world professional situations. This approach gives students the knowledge they’ll need for high-wage STEM careers, and it also gives them the ability to apply those skills with originality, no matter how much the STEM landscape changes over the course of their lives. 

For instance, at Crosstown High—an XQ school in Memphis, TN—students completed a STEAM project around the questions: “Should we go to Mars, and should we change it?” Students answered these questions through ecological, biological, and ethical investigations. In doing so, they learned how to apply their math and science knowledge to real-world scenarios. Students then presented their final project to an audience of NASA researchers, business leaders, and the general public. This final presentation further grounded the project in the professional world. As a whole, this project exemplifies how high school curricula can truly prepare students to join the workforce with advanced skills and the confidence to apply them.

Other features of innovative, career-minded high school curricula include:

  • Competency-based: Students progress through credits based on mastery of material, not seat time. In doing so, students learn to gauge their own progress and motivate their own learning—crucial skills for postsecondary success. 
  • Student-centered: Students decide what they learn and how they learn it, cultivating innovative, self-driven thinkers. 
  • Project-based: Students gain academic skills through solving real-world challenges, mastering the design thinking they’ll use to meet the challenges of the future.
  • Interdisciplinary: Students combine learning from multiple disciplines to find new ways of solving problems.

When high schools combine these approaches to learning, the results are powerful. Students master crucial academic skills through meaningful and engaged learning that is relevant to their lives and futures. And as a study from The Learning Agency shows, having these job-ready skills correlates to higher income for students, and greater economic growth for communities at large.

High School Education Empowers Underserved Communities

High schools can be engines of economic growth for historically marginalized individuals and communities. When high schools prioritize equity in their work, all students have the chance to pursue well-paying jobs. 

Washington Leadership Academy—an XQ school in Washington, D.C.—embodies this approach in its computer science program. WLA serves a student body that is 77 percent Black. Historically, BIPOC and low-income students are underrepresented in high-wage STEM fields. WLA is changing the script through its rigorous, four-year computer science program. WLA co-founder and executive director Stacy Kane explained, “We’ve been able to increase access, and achievement, for students of color in computer science—a field where they’ve been disenfranchised for far too long.”

These students aren’t just learning hard computer skills. They are learning those skills within a broader community context: how technology intersects with public policy, how people of color have built careers in the tech sector, and how technology can be used to strengthen their communities. This context prepares WLA students to take their technology skills and apply them across a wide range of professional situations. “The way we teach computer science is not strictly about coding, because coding always changes,” explained Jordan Budisantoso, one of WLA’s computer science teachers. “It’s about how to think about problems. It’s about logic. It’s about gaining an understanding of how technology shapes our world.”

High School Connects Students to the Local Economy

High schools can also serve as hubs of connection between students and the local economy. These connections are especially impactful for underserved students who might not otherwise have access to these professional and economic opportunities. 

This was true for Skyler, a student at Elizabethton High School—an XQ school in rural Tennessee—who secured a paid internship at a virtual reality firm while in high school. Skyler grew up in a low-income family in Elizabethton. When he started attending Elizabethton High, he discovered a passion for virtual reality that flourished thanks to the school’s focus on technology. It could have ended there—tech jobs are scarce in Skyler’s rural hometown. However, Skyler’s teacher Alex Campbell reached out to Lobaki, a virtual reality firm in Jackson, MS. Skyler completed a paid internship with Lobaki, which opened significant professional and economic possibilities. “There’s nothing like real job experience,” explained Skyler, now 18. “I grew up in a poor family. If this job didn’t pay, I never could have done it. I’ve even been able to save some money…And I’ve learned and progressed so much.”

High School Education Prepares Students for College

A strong high school education ensures that all students have the knowledge, confidence, and academic background to attend and succeed in college. High schools can increase the number of students pursuing post-secondary degrees in several ways, including:

  • Partnering with local universities 
  • Providing college counseling resources
  • Pairing students with information about scholarships and how to pay for college
  • Aligning their curricula with college entrance requirements

Purdue Polytechnic High School—an XQ school in Indianapolis, IN—shows what commitment to college preparation looks like in action. PPHS opened in 2017 as a partnership between state education leaders and Purdue University, with the goal of boosting academic achievement and college preparedness among Black, Latinx, and low-income students. School leaders ultimately wanted to set students up for high-wage STEM careers—and recognized that putting students on the pathway to college was the first step in this process. 

At PPHS, students pursue an innovative, project-based curriculum that educators design explicitly around Purdue University admission requirements and Indiana workforce development goals.

PPHS has seen huge success in fulfilling its mission. In a graduating class of 120 students, 48 were accepted to Purdue University—more than four times the number of students of color from all of Indianapolis who typically enroll at Purdue University. 

PPHS students credit their success to their high school experience. Student Kayla explained, “I definitely feel I am prepared for college. Being here helped me learn how to be a leader… It made me grow into the person I am.” DeAnthony, another PPHS student, expressed a similar theme: “This school is completely different from other schools. If I had gone to a different school, would I have gotten to where I am now? The answer is definitely no.” These student perspectives emphasize the relationship between high school and college: getting strong preparation in high school opens the door for students to pursue post-secondary pathways, leading to increased economic possibilities.

How to Invest in Education for Economic Growth: Policy Recommendations 

Education is one of the most powerful tools available to drive economic growth. A good high school education empowers students to go to college, pursue high-wage jobs, and drive innovation within their chosen field.

However, the positive relationship between education and economic growth depends on the quality of education students receive. For high school, that means ensuring all students graduate with the skills they’ll need to succeed in the 21st century. With that in mind, we offer the following policy recommendations for how to invest in effective high school education:

Improve critical high school infrastructure

  • Improve physical building structures
  • Expand access to technology
  • Diversify the teaching corps

Engage in community-led design of high schools

  • Create serious incentives, financial and otherwise, for districts to pursue community-led efforts

Redesign the daily learning experience for students

  • Invest in competency-based curricula
  • Change the credit structure that drives graduation requirements

Emphasize college and career preparation

  • Develop a profile of a graduate
  • Align course requirements with college admissions

Transforming high school to meet the needs of the future is no small task. But the payoff, for students and for our society as a whole, is worth it. We hope you’ll join us in our work to invest in the future through investing in high school.