A Summer Training Report on the Impact of Global Economic Crisis on the Indian Economy

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A Summer Training Report on the Impact of Global Economic Crisis on the Indian Economy Powered By Docstoc
					From Educating the Individual to
     Retooling the Nation:
   The Critical Role of ABE
          Educators
        Bruce P. Corrie, PhD
       Professor of Economics
    Concordia University-Saint Paul
     2006 ABE Statewide Summer Institute
            Saint John’s University
       Funded by an Otto Bremer Grant
         Overview
A New Paradigm
The Emerging Challenge
The Return on Investment in ABE
A New Marshall Plan
ABE Educators: A New Vision
   You are not just educating the individual

   You are retooling the nation and Minnesota in
   our new global competitive economy

   Your special focus on the low-skilled
   youth/worker is very critical for the nation’s
   and the Minnesota’s long term economic
   security and growth. This critical mass of
   people in the US and local economy need
   immediate attention else we will face serious
   problems in the years ahead.
A New Vision
   The nation needs to develop strategies to
   retool the low wage low skill workforce in the
   face of global competition.
   ABE programs play a very important role as
   they improve the skills of workers and in so
   doing, increase productivity in the workplace
   have a number of other social benefits, and
   raise the standard of living in local economies
   and national economies.
   We need a new Marshall Plan to invest in this
   disenfranchised population.
Overview
  Next slides will present
    Data on the number of low skilled workers
    Data on the declining need for low skilled workers
    in the USA by our firms
    Data on the challenges of an important pool of
    future workers in MN – immigrants and minorities
    Data on the effectiveness of ABE in meeting the
    challenges of our future workforce
    Data to illustrate how investing in our emerging
    workforce through ABE programs help to
    strengthen the economic base in MN.
The Challenge
   1.9 million workers with wages at
   or below $5.15 an hour in the US
   561 thousand without a high
   school degree
   547 thousand high school without
   college
   62, 800 thousand in Minnesota
   Source: CPS 2006, Census 2000 from DEED data for MN.
Challenge MN
  In Minnesota, 30 percent of all workers
  or over 800,000 workers are low-wage
  workers. The proportion of low-wage
  workers in Greater Minnesota varies
  from a low of 35 percent in the
  Southeast region to a high of 46 percent
  in the Northwest Region. (Less than $10
  an hour)
  http://www.deed.state.mn.us/lmi/publications/wagedist/98_00/region.htm
Who are low wage workers?
   Are disproportionately - Young,
   female, minority, with a high
   school degree or less and with
   health limitations

   Characteristics of Low Wage Workers and their Labor Market Experiences. http://aspe.hhs.gov/hsp/low-wage-
   workers04/ch7.htm
Challenge: Employers want higher
skills
   Large study which included
   Minnesota found employers
   reduced employment shares of low
   skilled workers and increased
   shares of high skilled workers in
   virtually every industry.
   Found a continuing up-skilling of
   the work force
   John Abowd, Paul Lengermann, Kevin L McKinney (2003), Measurement of Human Capital in the U.S. Economy.
   US Census, LEHD Program.
Challenge: Firms Need High Skills
to Increase Productivity and Grow
   Found that quality of the Human
   capital of the firm determined
   productivity and market value of
   the firm.

   Bowd J.A. et al (2002) The Relation among Human Capital, Productivity and Market Value: Building up from Micro
   Evidence. US Census, LEHD Program
Challenge: MN Population
Crisis
  According to both the MN State
  Demographer and the MN State
  Economist, MN is going to rely
  increasingly on migration to meet
  its labor needs because of an aging
  population.
Minorities/Immigrants – Increasing share of
            the Prime workforce
                 2005-2030

                                                     Workers 25-54 Years
              Percent Growth in Population




                                             120                             109

                                             100
                                                    75
                                              80

                                              60

                                              40
                                              20

                                               0
                                                   Asian                   Hispanic




   Source: MN State Demographer
   Population Projections
Minorities/Immigrants – Increasing share of
              the Tax Base
                2005-2030

                                                  Growth in 45-54 Age Group
              Percent Change in Age Group




                                            350                                 307
                                            300
                                            250
                                            200    177

                                            150
                                            100
                                             50
                                              0
                                                  Asian                       Hispanic




       Source: MN State Demographer Population Projections
               Minorities/Immigrants – Increasing share of the
                            Emerging workforce
                                2005-2030
                   Percentage Growth in College Age Students

                                                     257.46
             240
                                                                      White
             190                                                      Black
Percentage




             140                                                      Asian
                                                              99.19
                                                                      American Indian
              90             73.84
                                     60.11                            Two or More
              40                             24.18                    Latino
                     -0.35
             -10
                                         1
                                     2000-2030


Data from MN State
Demographer Projections
Many Minnesota Students Have
    Low Human Capital
                                                     Graduation Rates: 2002-2003

                                   70
                                                                                         60
           Percentage Graduating




                                   60                       53                      52
                                                       49
                                   50                                     45 47
                                                                 38 38
                                   40                                                         2000
                                          29 26
                                   30                                                         2003
                                   20
                                   10
                                   0
                                        Am. Indian     Asian     Black   Hispanic   White




   Source: Minnesota Minority Education Partnership, 2006
Many Minnesota Students Have
    Low Human Capital
          PSEO Students                         Perent AP Test Takers


           1 7 4
                                                    0   7    2 2
                   2      Am. Indian                                    Am. Indian
                          Asian                                         Asian
                          Black                                         Black
                          Hispanic                                      Hispanic
                          White                                         White
     87                                    86




   Source: Minnesota Minority Education Partnership, 2006
Human Capital of Minnesota
      % Adults with no high school degree                      9%

      % Adults with high school degree                         29 %

      % Adults with some college degree                        32 %

      % Adults with college degree or higher 30 %
 Source: http://www.nccp.org/pdf/state_detail_context_MN.pdf
The Global View on Skills

                                  US and Other Countries: Literacy Proficiency by
                                                  Employment
     Literacy Proficiency




                            300
                            250
                            200                                        US
                            150
                            100                                        19 High Income Countries
                             50
                              0
                                  Employed   Unemployed Not if Labor
                                                          Force
                                         Employment Status


   Source: Pathways to Labor Market Success. ETS, 2004
Role of ABE in Retooling MN
   GED

   ELL

   Worker Training

   How effective are these programs?
Impact of GED
  Leads to increase in earnings for high
  school dropouts with weak skills (36
  percent for 27 year olds)
  Returns for postsecondary training is as
  high for GED as for traditional high
  school graduates
  Many other benefits such as increased
  literacy skills, more self confidence,
  better life skills.
Impact of Schooling on Crime
   High school graduation rates
   results in a 0.8 percent reduction
   in the probability of incarceration
   from Whites and a 3.4 percent
   reduction for Blacks.
Impact of Schooling on Crime
   One additional year of schooling
   reduces:
         Arrest rates by 11 percent
         Murder and assaults by 30 percent
         Motor Vehicle Theft by 20 percent
         Arson by 13 percent
         Net Benefit of $1.4 billion to the nation
         (However, increased rapes and robbery)
   Lance Lochner and Enrico Moretti, The Social Savings from Reducing Crimes through Education. Joint Center for Poverty
   Research http://www.jcpr.org/policybriefs/vol4_num5.html
Impact of Schooling on Children in
Poverty
   From 1984 to 2004 the number of
   children in poverty increased from
   66 to 75 percent for families with
   parents with less than high school
   education
   It rose from 36 to 45 percent for
   parents with a high school diploma
   It remained at 17 percent for
   families with some college
   education
Literacy Proficiency and
      Employment
                          Literacy Proficiency and Unemployment Rate

                     12     10.2
 Unemployment Rate




                     10
                      8
                      6                      5.1
                                                               4
                      4                                                   2.4
                      2
                      0
                           Level 1        Level 2           Level 3   Level 4 or 5
                                             Literacy Proficiency



                      Higher Proficiency = Lower Unemployment

Source: Pathways to Labor Market Success. ETS, 2004
Prose Proficiency and
Education
                                 Prose Proficiency by Education

                100%
                                                                                          Mean
                80%
                                                                                          Level 5
  Proficiency




                60%                                                                       Level 4
                40%                                                                       Level 3
                                                                                          Level 2
                20%
                                                                                          Level 1
                 0%
                       9-12 yrs           GED              HS            PS   2yr   4yr
                                                      Educational Level


                Higher Education = Higher Literacy Proficiency
                   Source: Pathways to Labor Market Success. ETS, 2004
Quantitative Proficiency and
         Earnings
                               Quantitative Proficiency and Mean Weekly Earnings

                          1000                                                            913
  Mean Weekly Earnings




                           800
                                                                                634
                           600                                        533
                                                       438                                         Series1
                           400         330

                           200

                              0
                                      Level 1        Level 2        Level 3    Level 4   Level 5
                                                         Quantitative Proficiency



  Higher Quantitative Proficiency= Higher Earnings

                         Source: Pathways to Labor Market Success. ETS, 2004
Immigrants, Lit Proficiency and
          Earnings
                                 Mean Weekly Earnings by Literacy Proficiency

                          1200                                           1108
   Mean Weekly Earnings




                          1000
                                                                                 792
                           800                            632
                                            520                 552                                   Immigrants
                           600                    448
                           400    318 364                                                             Native Born

                           200
                             0
                                  Level 1    Level 2      Level 3       Level 4 or 5
                                             Literacy Proficiency



            Higher Literacy Proficiency = Higher Earnings
                                                                      Source: Sum et al (2002). ETS
Premium for Speaking English
                                              Premium for Speaking English Well
     Income Differential




                           45000                                                                                39106
                           40000
                           35000                                                                                        24406
                           30000                                                                19808
                           25000
                           20000                        9991          11269           9674
                           15000           8144
                           10000
                            5000
                               0




                                                                                                                        l
                                                    ED




                                                                                                                r



                                                                                                                        Al
                                                                 ge
                                       a




                                                                                               ee
                                                                                 e




                                                                                                               e
                                       m




                                                                                 re




                                                                                                            gh
                                                                lle
                                                   G




                                                                                               gr
                                    lo




                                                                               eg




                                                                                                           hi
                                                                                             de
                                                            co
                                   p



                                                  or
                                di




                                                                            D




                                                                                                       or
                                             S




                                                                                          's
                                                            s



                                                                           s
                               no




                                                          ar
                                             H




                                                                                       or



                                                                                                      's
                                                                        te
                                                        ye




                                                                                                       r
                                                                                    el
                                                                      cia
                            S




                                                                                                    te
                                                                                  ch
                           H




                                                                                                as
                                                       3



                                                                  so
                                                       1-




                                                                                Ba



                                                                                               M
                                                                As




             Source: Sum et al (2002). ETS
                                                                0
                                                               10
                                                               20
                                                               30
                                                               40
                                                               50
                                                               60
                                                               70
                                                               80
                                                               90
                                                   Help
                                               Children HW



                                                   New Job



                                                 Career
                                               Adancement


                                                  College of
                                                   VoTech
                                                                    GED & Reasons




                                                 Welfare
                                               Requirement


                                                   Self
                                                Confidence


                                               Improve Daily
                                                  Tasks
Source: National Adult Literacy Survey, 2005
                                                                                    Reasons for Taking GED
                                                               Percent of adults




                                                                                   100




                                                               0
                                                                   20
                                                                   40
                                                                        60
                                                                        80
                                                   Help




                                                                        44
                                               Children HW


                                                 Citzenship
                                                                        45
                                                   New Job
                                                                         56




                                                 Career
                                                                             60




                                               Adancement

                                                  College of
                                                                              67




                                                   VoTech
                                                                                          Reason for Taking ELL




                                                 Welfare
                                                                   15




                                               Requirement

                                                   Self
                                                                                     95




                                                Confidence
                                                                                                                  Reason for Taking ELL




Source: National Adult Literacy Survey, 2005




                                               Improve Daily
                                                                                    93




                                                  Tasks
                           Low Skill = Low Training
                                Participation
                                       Training Participation

                      70
                                                                       59.1
Percent in Training




                      60                                    49
                      50
                      40                    32.3
                      30
                              17.3
                      20
                      10
                       0
                             Level 1       Level 2        Level 3   Level 4 or 5
                                            Document Proficiency
Returns to Schooling
   Barrow and Rouse (2006) using
   data from the Current Population
   Survey find that each additional
   year of schooling results in a
   average increase in earnings by 11
   percent
Immigrants
  Each year of schooling completed
  by an immigrant adds 6.2 points to
  their predicted composite literacy
  proficiency score.
  The earlier one began studying
  English, the higher his/her
  predicted proficiency score.
Education and Living Standards
   According to the Economic Report
   of the President, 2006, studies
   have shown that during the period
   1950-1993 one third of the
   economic growth in the country
   was due to increased levels of
   education
Higher Education = Lower Unemployment

                                  Educational Levels and
                                     Unemployment

                     9
                             Less Than HS
                     8
                     7
      Unemployment




                     6
                     5                High School
                                              Some College
                     4                                  Associate Degree

                     3                                           Bachelor's Degree
                                                                           Masters Degree
                     2                                                               Doctoral Degree
                                                                                               Prof essional Degree

                     1
                     0
                         0        2                 4                  6                    8                 10
                                            Educational Level


     Source: 2006 State of Students of Color. www.mnmep.org
Higher Education= Higher Income
(US)

                                               Education and Income

                   $120,000
    Income Level




                   $100,000
                    $80,000
                    $60,000
                    $40,000
                    $20,000
                         $0
                                                             College




                                                                                                          Doctoral
                                               High School




                                                                                                Masters
                                                                                   Bachelor's




                                                                                                Degree
                                                                       Associate




                                                                                                          Degree
                                   Less Than




                                                                                                                     Professional
                                                              Some




                                                                        Degree


                                                                                    Degree




                                                                                                                       Degree
                                      HS




                   Source: 2006 State of Students of Color. www.mnmep.org
So You Want to Be a Millionaire
               4
               3
               2
               1
               0
                              Bachelor's Associate's   Some      High School Not High
                   Advanced
                               Degree     Degree       College      Grad      School
       White         3.1         2.2         1.6         1.6        1.3        1.1
       Black         2.5         1.7         1.4         1.2         1         0.8
       Asian         3.1         1.8         1.5         1.3        1.1        0.9
       Hispanic      2.6         1.7         1.4         1.3        1.1        0.8


    LIFETIME EARNINGS BY EDUCATIONAL LEVEL (Day &
                   Newburger, 2002)
Retooling of Minorities in MN Adds
to the Economic Base of Minnesota
   More productive Workers
   Expands the consumer Base
   Increase Entrepreneurship
   Builds Cultural Capital
   Makes us competitive in the Global
   Economy
Consumer Base
  According to the Selig Center
  Buying Power of minorities and
  immigrants is an estimated 12
  billion dollars.
  This is greater than the GDP of 90
  countries in the world
  Higher skilled workers will have
  higher earnings and expand their
  consumer power in Minnesota
Workers
  Minorities and immigrants are
  overrepresented in both the high
  skilled as well as low skilled
  occupations.

  Improving the skills of these
  workers will add to the
  productivity of Minnesota
Black Workers in MN
 Nuclear Engineers (151) SOC 17-2161

 Taxi Drivers and Chauffeurs (914) SOC 53-3041

 Hazardous Materials Removal Workers (672) SOC 47-4041
 Cleaning, Washing, and Metal Pickling Equipment Operators and Tenders (886) SOC 51-
     9192

 Aircraft Structure, Surfaces, Rigging, and Systems Assemblers (771) SOC 51-2011

 Parking Lot Attendants (935) SOC 53-6021

 Actors (270) SOC 27-2011

 Nursing, Psychiatric, and Home Health Aides (360) SOC 31-1010

 Credit Authorizers, Checkers, and Clerks (523) SOC 43-4041
Asian and Latino Workers
                        High Tech
   Medical Scientists
   Physicians and Surgeons
   Chemical Engineers
   Postsecondary Teachers
   Computers and Electronics
                         Low Tech
   Food Preparation, processing
   Roofers
   Dining room and Cafeteria attendants
   Maids and Housekeeping Cleaners
Minority/Immigrant Firms
   22,405 minority firms in Minnesota
   with $2.7 billion in sales.
   3497 of these firms had employees
   employing 31, 474 people
   with an annual payroll of 819
   million dollars.
Minority/Immigrant Firms
   Minority firms in Minnesota grew
   by 44 percent during 1997-2002 as
   compared to a growth rate of 8
   percent of all firms.
   American Indian firms were 13th
   in the nation in terms of growth of
   firms during the same period.
Immigrant Firms on University Avenue
  in Saint Paul (1980, 1991 & 2005)
MN – Integrated with the Global
          Economy
MN Rank 2003, 2004
 Export Volume, 2004           20
 Exports (Latin & S. America)  25
 Exports (Asia)
    15
 Exports as Percent of GSP
    23
 Employment (Foreign Companies)
    22
Cultural Capital is Important for
          Minnesota
  Richard Florida and the rise of the
  Creative Class
  New case for diversity – brings
  creativity into an organization
  Minority food, art, culture, music,
  ideas, theatres adding vitality to
  Lake Wobegon
               Summary
The nation needs to develop strategies to
retool the low wage low skill workforce in the
face of global competition.
ABE programs play a very important role as
they improve the skills of workers and in so
doing, increase productivity in the workplace
and have a number of other social benefits.
Investing in Minorities and Immigrant
communities will yield positive returns in the
long run
What we need is a new Marshall Plan to retool
the nation’s low wage low skill workforce
Data on Characteristics of GED and
ELL Learners
Characteristics of GED Population

                            GED: Percent of Adults

                7
                      6
                6
                5
      Percent




                4
                3
                              2
                2
                                         1
                1
                                                      0        0
                0
                    16-24   25-34      35-44         45-54   55-64



   National Adult Literacy Survey, 2005
Characteristics of GED Population

                                      GED: Minority Percentage

                        3.5
                                                   3
                         3
    Percent of Adults




                        2.5
                                        2
                         2
                        1.5
                              1                                  1         1
                         1
                        0.5
                         0
                              White     Black     Hispanic   Asian PI   Other, non HI
Characteristics of GED Population

                                                  GED by Income

                           2.5
                                      2           2
       Percent of Adults




                            2

                           1.5
                                                           1                        1
                            1

                           0.5
                                                                        0
                            0
                                  20,000 and   20,001-   35,001-   50,001-75000 75,000 and
                                     less      35,000    50,000                   above




                                 National Adult Literacy Survey, 2005
Characteristics of GED Population
                                 GED by Employment Status

                 7
                                                     6
                 6
                 5
       Percent




                 4
                 3
                                        2
                 2
                        1                                    1
                 1
                 0
                     Full Time       Part Time      UNE     NLF


                 National Adult Literacy Survey, 2005
Characteristics of GED Population
                                  GED by Occupation

             2.5

              2
   Percent




             1.5

              1

             0.5

              0
                   Professional/Mgr    Sales/service/tech   Trade and Labor
 Bruce P. Corrie, PhD
Concordia University
Saint Paul, MN 55117
   corrie@csp.edu
  Tel: 651 641 8226
                               GED by Occupation

          2.5

           2
Percent




          1.5

           1

          0.5

           0
                Professional/Mgr    Sales/service/tech   Trade and Labor
Characteristics of ELL Population

                                                     ELL by Race/Ethnicity
     Percent of ELL Learners




                               Other, non HI 0

                                  Asian PI                     2

                                  Hispanic                                           6

                                     Black 0

                                     White       0

                                             0       1     2       3     4   5   6       7
Characteristics of ELL Population
                                               ELL by Education

                          2.5
   Percentage of Adults




                           2

                          1.5

                           1

                          0.5

                           0
                                Less HS   HS         Some     Bachelor's   Graduate
                                                    College
Characteristics of ELL Population

                                                  ELL by Income

                        2.5
                                              2            2
    Percent of Adults




                         2

                        1.5
                                  1                                                 1
                         1

                        0.5
                                                                        0
                         0
                              20,000 and   20,001-       35,001-   50,001-75000 75,000 and
                                 less      35,000        50,000                   above
Characteristics of ELL Population

                                            ELL and Jobs

                          2.5
      Percent of Adults




                           2

                          1.5

                           1

                          0.5

                           0
                                Full Time   Part Time   UNE and Looking   Not in LF
Characteristics of ELL Population

                                             ELL and Occupation

                         2.5
                                                                             2
     Percent of Adults




                          2

                         1.5
                                                          1
                          1

                         0.5
                                      0
                          0
                               Professional/Mgr   Sales/service/tech   Trade and Labor

				
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Description: A Summer Training Report on the Impact of Global Economic Crisis on the Indian Economy document sample