U.S. Education Spending Tops Other Countries – But Who’s Benefiting?
By Tim Walker
During the worse years of the economic crisis, United States was one of the few nations who actually decreased its investment in education. Between 2008 and 2010, education spending in the U.S. dropped by 1%, as it increased by an average 5% in other countries, according to the 2013 “Education At a Glance,” the Organization for Economic Cooperation and Development’s (OECD) annual survey of global education trends. Joining the United States in pulling back its education investment is Estonia, Hungary, Italy and Iceland.
Still, in terms of real dollars, overall education spending in the United States tops the other OECD nations. Across all levels of education, the United States spent $15,171 per student in 2010. In total, education expenditures amounts to around 7.3% of its gross domestic product. The OECD average is 6.3%. But the dollar amount and student results don’t match. For example, the United States is falling behind in college completion rates and its investment in early childhood education lags most other nations. Why the discrepancy? The answer is simple: a regressive funding structure.
According to OECD, the share of education funding in the U.S. that comes from private sources is much higher than in other nations. In 2010, 31 percent of funding came from private sources, far above the OECD average of 16 percent. At the college level, the contrast is even starker. Almost 70 percent of higher education funding came from private tuition, roughly 30 percent from the public. Across all OECD countries, 60 percent comes from public sources, 32 percent from private.
At the K-12 level, many U.S. schools rely primarily on property taxes, so wealthier communities have far more to spend. Private colleges, of course, can access to wealthy donors and massive endowments to fund programs. Community colleges meanwhile have been gutted by state budget cuts.
“The U.S. is one of the few that invests in a regressive way. Children who need (public funding) the most get the least of it,” said Andreas Schleicher, an education policy adviser to the OECD.
Schleicher and other experts have noted that the U.S. used to be much better at directing dollars to those students who needed it most. Now, most other OECD countries have taken up that mantle.
“Countries must focus efforts on helping young people, especially the less well-educated who are most at risk of being trapped in a low skills, low wage future,” said OECD Secretary-General Angel Gurría. “Priorities include reducing school dropout rates and investing in skills-oriented education that integrates the worlds of learning and work. Though the focus should remain on quality of spending, Governments must ensure that investment in education does not fall as a result of the economic crisis.”
This is good advice to lawmakers in Congress who are determined to let low-income children bear the burden of across-the-board budget cuts. Since the sequester went into effect in March, programs and services meant to help the nation’s most vulnerable students programs are being drained of critical funding.
The U.S. also lags behind in the area of early childhood education. In most OCED countries education begins at an earlier age than in the U.S. For example, only 50% are enrolled in early childhood programs at age 3. In Denmark, France, Spain, and other countries, more than 90 percent of children are enrolled by that age.
The typical age for entering early childhood education in the United States is 4 years old, but in 2011, only 78% of children this age were enrolled, compared with 85% across OECD countries. Enrollment rates have improved in the U.S. since 2005, when 65% of 4-year-olds in the United States were enrolled. Compared to where other nations stand, however, there is much room for improvement.
Other nations have also increased teachers’ salaries more quickly than the United States. Teachers’ salaries increased between 17 percent and 20 percent between 2000 and 2001; in the United States, that increase was just 3 percent.
“Teachers’ salaries represent the largest single cost in formal education and have a direct impact on the attractiveness of the teaching profession,” the report states. “Since compensation and working conditions are important for attracting, developing and retaining skilled and high-quality teachers, policy makers should carefully consider teachers’ salaries as they try to ensure both quality teaching and sustainable education budgets.”