Nationwide, an average of 10,000 baby boomers per day will reach retirement age between now and 2030. Many people are rightly concerned about the viability of federal entitlement programs. But few have considered the impact on state budgets as well, including consequences for their local schools. Today, ExcelinEd published “Hurricane Gray Swirls Toward South Carolina: Age Demographic Change and the Near Future of South Carolina Education,” which shows just how unprepared South Carolina is for Hurricane Gray.
Age demography has a significant impact on economic growth. When you have a growing number of young and old in a population, with proportionately fewer working-age people to support them, the result is slower economic growth and higher demand for state spending on items such as pensions, healthcare and education. There is a relatively simple formula for calculating a state’s vulnerability to these demographic forces. You add the percent of the population over the age of 65 and under the age of 18. And then you divide that total by those in the age group in between (ages 18-64). The answer gives you the age-dependency ratio—the percent of workers versus the percent of those dependent on them.
In 2010, South Carolina had an age-dependency ratio of 59 percent, meaning there were 59 people in the dependency age groups for every 100 working-age people. By 2030, the age dependency ratio will blossom to 79 percent. The burden on the working class is growing rapidly.
Just for the sake of perspective, Florida, a national retirement destination, had an age dependency ratio of 63 in 2010.
South Carolina is growing at both ends of the age spectrum. There is predicted to be an 87 percent increase in the elderly population between 2010 and 2030, and a 10 percent increase in the youth population.
The elderly come with increased demands for health care. Medicaid funding is already constraining other state funding in the South Carolina budget, including K-12 education (see the full report for more details). This is happening even before the mass baby boom retirement.
In order to secure a brighter future for all citizens, South Carolinians must take action now.
The keys to surviving and thriving through Hurricane Gray lie in expanding economic growth and creating greater efficiencies in publicly funded programs. In education, this innovation needs to start immediately. To support both the young and elderly, the working-age South Carolinians of the future who are sitting in today’s classrooms must be educated, skilled, efficient and innovative.
In South Carolina, the urgency to implement innovative and cost-effective educational solutions is particularly acute because of the Abbeville v. State lawsuit. The state legislature is under court order to better address the needs of the highest poverty school districts in the state, despite fiscal constraints.
Education reform is necessary to achieve this goal. We are seeing what is possible in public charter schools, where education innovators are producing a bigger bang for the buck. The figure above shows math achievement per $1,000 invested nationwide in charter schools as opposed to traditional public schools.
This does not mean we can’t have innovation in school districts. Florida, for instance, created financial incentives that have greatly increased student participation in Advanced Placement and industry certification coursework.
South Carolina has joined other states that are creating digital learning opportunities for students. This gives them access to a slew of courses that may not be available in their brick-and-mortar classrooms.
Next generation choice models—such as Achievement School Districts and Education Savings Accounts—represent significant refinements over charter and voucher approaches. New Orleans revolutionized education in the post-Katrina era by leveraging school buildings to attract new providers and innovative leaders, creating an all-charter, choice-based education system. Lawmakers in five states have created Education Savings Accounts to provide parents with not just the opportunity to choose private school, but also to hire certified tutors and licensed special needs therapists, select online programs and choose individual public school courses. Parents who manage their child’s funds carefully can even put away some funds for future higher education expenses, further expanding opportunity with fewer overall resources.
South Carolina faces a challenge that will steadily grow more acute, but the state controls its own destiny. Past generations faced far greater challenges and left behind a better country than the one they found. South Carolina owes it to its young and future citizens to do the same.