National Institute on Aging

The Economic Cost of Racial Inequality in Higher Education

A new report from the Center on Education and the Workforce at Georgetown University examines the costs to the U.S. economy due to racial inequity in higher education.

The study conducted a simulation that found that the U.S. economy misses out on $956 billion dollars per year, along with numerous nonmonetary benefits, as a result of postsecondary attainment gaps by economic status and race/ethnicity. The study estimates that closing these gaps would require an initial public investment of at least $3.97 trillion, but the benefits would outweigh the costs over time. Equalizing educational attainment without increasing student debt for low-income adults could also boost the gross domestic product by a total of $764 billion annually.

The report’s authors estimate that if Blacks and other underrepresented groups were educated at the same level as White adults, the following benefits would occur:

  • Higher earnings due to increased educational attainment among workers could yield a $308 billion annual increase in tax revenue.
  • Spending increases on goods and services could result in an annual GDP boost of $542 billion.
  • Higher attainment levels could result in $33.7 billion in annual savings from a reduced need for federal public assistance programs.
  • Since people with more education are less likely to be incarcerated, increased educational attainment could yield a $13.8 billion annual reduction in public criminal justice expenditures by reducing the number of incarcerated people.
  • Public health spending is lower for people with higher levels of educational attainment, potentially resulting in savings of $58.7 billion annually.

The full report, The Cost of Economic and Racial Injustice in Postsecondary Education, may be downloaded by clicking here.


Comments (3)

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  1. Ewart Archer says:

    The findings of this study reflect its major assumptions. Unfortunately, the assumptions are not realistic.


  2. Michael says:

    Hey ‘ewart’ (lower case ‘e’intentional),

    You’re the epitome of “Self-hatred In Self-hatred Out”(SISO). You’re a private industry buffoon.

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