THEANGEL&THEGAMBLER
Rookie
Why Education Does Not Fix Poverty
.....2. It Didn't Work
Since 1991, we have done precisely what the education-focused poverty people said to do. Between 1991 and 2014, we steadily reduced the share of adults in the "less than high school" and "high school" bins and increased the share of adults in every other bin:
By 2014, the share of adults in the "less than high school" bin declined 9 points from 20.6% to 11.6%. The share of adults in the "high school" bin declined 6.5 points from 36% to 29.5%. Meanwhile, the share of adults with an Associate degree went up 3.9 points, the share with a Bachelor's degree went up 8.3 points, and the share with a post-Bachelor's degree went up 4.8 points.
If the poverty rates for each educational bin remained the same, then the upward redistribution of adults from the lower bins to the higher bins would have led to lower overall poverty. But that's not what happened.
Instead, the poverty rate for each educational bin went up over this time and overall poverty didn't decline at all. In fact it went up.
By 2014, the "less than high school" poverty rate had increased 3.7 points. The "high school" poverty rate increased 4.6 points. "Some college" went up 4.1 points, "associate" went up 3.8 points, "bachelor's" went up 2.1 points, and "post-bachelor's" went up 1.7. Despite the educational gains, overall adult poverty in 2014 was actually 1.1 points higher than in 1991.
As the adults migrated up the educational bins, it took the poverty into the higher educational bins with them:
Over this period, the share of poor adults with "less than high school" education plummeted 20.1 points from 48.3 points to 28.2 points. Every other educational bin saw share gains of 2.6 to 5 points.
Adults these days are as educated as they have ever been, but poverty is no lower than it was in 1991. This is not because the few lingering people with "less than high school" have soaked up all the poverty. Quite the contrary: poverty has simply moved up the educational scale. The poor in 2014 were the most educated poor in history.
3. Why It Doesn't Work
There are a number reasons why aggregate education gains do not necessarily translate into aggregate poverty declines. I will discuss three here.
First, handing out more high school and college diplomas doesn't magically create more good-paying jobs. When more credentials are chasing the same number of decent jobs, what you get is credential inflation: jobs that used to require a high school degree now require a college degree; jobs that used to require an Associate degee now require a Bachelor's degreee; and so on. Obviously the supply of good-paying jobs is not a fixed constant of nature, but there is no reason to think that the supply will automatically go up to match the number of people with the necessary credentials. The types of jobs available in a society, and their level of compensation, is determined by many factors (demand, worker power, technology, global competition, natural resources, etc.) that have little to do with the number of degrees that society is minting.
Second, having more education does not necessarily increase people's productive capacity. Those in the know will identify this as the old "signaling v. human capital" point. The short of it is that, even if jobs did automatically pop into existence to match people's level of productive ability, it's not at all clear that college education necessarily does a lot to increase people's productive ability. Instead, what college education does (at least in part) is signal to employers that you have a certain level of relative "quality" over others in society. As more people get degrees, the value of this signal declines, but more importantly, the point is that the degree was always a signal, not a productivity enhancer.
Third, poverty is really about non-working people: children, elderly, disabled, students, carers, and the unemployed. The big things that cause poverty for adults over the age of 25 in a low-welfare capitalist society—old-age, disability, unemployment, having children—do not go away just because you have a better degree. These poverty-inducing circumstances are social constants that could strike anyone of us and do strike many of us at some point in our lives. To the extent that education does nothing to provide better income support for those who do find themselves in these vulnerable situations, its effect on overall poverty levels will always be weak, or, as with the US in the last 23 years, totally nonexistent.....
