The organization: In addition to our work with clients and partners, The Learning Agency is also an engaged creator of independent research and thought leadership. Bringing together the expertise of our diverse team, The Learning Agency examines the most pressing issues in education in order to foster innovative solutions.
The need: The Learning Agency believes that education opens doors, and we undertook this research project to quantitatively demonstrate the economic power of academic skills with the ultimate goal of writing a final, public-facing report. We had two main goals with this project: inspire national investment in education and encourage policymakers to prioritize education for economic growth. We aimed to demonstrate via our report that investing in education was not only crucial for rebuilding the economy post-COVID-19, but also a viable long-term strategy. By quantifying the economic benefits of improved academic skills, this project sought to highlight the importance of improving U.S. education and increasing funding for public schools as pivotal to the country’s economic future.
Our role: We executed this study from start to finish, leading the study design, data collection, assumptions, and analysis framework that assessed the relationship between academic skills and salary gains. Our successes in this project include:
- Designing an effective research study. The research team designed and implemented the methodology for this study, drawing from a 2015 National Bureau of Economic Research (NBER) study titled “Returns to Skills around the World: Evidence from PIAAC.” We extrapolated the findings from the NBER study, which suggested a 28% increase in wages due to improved math skills and a 27% increase in wages due to improved reading skills, and applied them to federal data sources on salary and wage estimates in the US. By doing so, we estimated individual, state, and national income gains. Additionally, the team designed a separate analysis to estimate the potential wage increase for workers without a high school diploma if they were paid based on the earnings of high school graduates.
- Gathering robust and insightful data. The research team gathered data from various sources to project both individual and aggregate economic gains. We identified relevant datasets from the Bureau of Labor Statistics and U.S. Census Bureau, which provided information on current wages, work status, occupation title, and demographic characteristics. By accessing these datasets, the team could analyze the data and draw conclusions regarding the economic benefits on both an individual and overall scale.
- Establishing and evaluating key assumptions. The research team had to establish key assumptions in order for the study’s findings to be reliable and valid, such as assuming that all wages would increase in proportion to the level of education or that wage gains due to improved math skills would most likely apply to workers in the Science, Technology, Engineering, and Mathematics field.
- Leveraging an analysis framework. The research team performed the data and econometric analysis for this study to project income gains over a one-year and twenty-year period. Throughout this process, the team collaborated in analyzing the data, refining their methodologies, and ensuring the accuracy of the findings.
- Publishing a public-facing and engaging report. Once our analysis and study was complete, we compiled our findings into a report that not only detailed our findings, but also provided recommendations for steps moving forward, such as boosting funding for education and particularly for programs proven to give students the best results.