The Economic Impact of the Wake County Public School System
The Wake County Public School System (WCPSS) serves more than 160,000 students in pre-K to grade 12 programs in 192 schools and with an annual budget of more than $1.6 billion.
It is among the top employers in Wake County. Given its size and significant task of equipping students with necessary knowledge and skills for the modern workforce and for success in post-secondary education, the economic impact of WCPSS is large, widespread, and long-lasting across several decades.
In 2015, WakeEd Partnership collaborated with WCPSS to commission a study from N.C. State University Reynolds Distinguished Professor Michael Walden to determine what the economic impact of WCPSS on Wake County.
Updated now for 2020, this economic impact study continues to illustrate the large and significant impacts of the Wake County Public School System on our local economy.
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Press Release:
New Report Finds Wake County Public School System Has Major Impact on Local Economy
Watch: Dr. Michael Walden presents his findings to the Wake County Board of Education on Nov. 10, 2020.
The Economic Impact of the
Wake County Public School System
Economic Impacts of WCPSS
Spending Impact in Local Economy
The impact on county spending and employment of WCPSS’ annual budgets, including the spending by WCPSS on salaries, supplies, and other operational support which generates income to employees and vendors. Employees and vendors will, in turn, re-spend a portion of these funds in the local economy, thereby establishing a “ripple”, or “multiplier” total impact of WCPSS’ budget.
Economic Value of Degrees Awarded
Improved academic performance of WCPSS graduates who attend college can be linked to a portion of the added lifetime earnings received by college graduates.
Future Reduction in Public Costs
Increases in high school graduates have been shown to be associated with positive public outcomes, such as reduction in crime rates and welfare and public health care costs.
Economic Impact on Local Wealth
Considerable research also indicates citizens value well-performing schools. Economically, this value is incorporated into a premium in local property values.
Spending Impact in the Local Economy
SPENDING & EMPLOYMENT IMPACTS
Every operating $1.00 spent by WCPSS and retained in the county results in total county spending of $1.71.
Every one job in WCPSS creates another 0.32 jobs in the county.
Every $1 of capital budget spending by WCPSS on non-land purchases and retained in the county results in $1.63 of total county spending.
Every $1 million of capital spending by WCPSS and retained in the county is associated with 11.7 jobs in the region.
Economic Value of Degrees Awarded
DEVELOPMENT OF HUMAN CAPITAL
Students with more “human capital” tend to be more successful, earn higher salaries, and are able to attract better- paying jobs to the community.
The most recent data show the increment in annual earnings between a high school dropout and high school graduate is approximately $7170.
In the last five years, 49% of WCPSS graduates entered a four-year college and another 21% entered a two-year college. Students successfully completing a college degree will further enhance their human capital and add to their lifetime income.
Future Reduction in Public Costs
DEVELOPMENT OF SOCIAL CAPITAL
Individuals with higher levels of social capital would be more likely to participate in the electoral process, less likely to engage in criminal activity, less likely to require public financial assistance, and more likely to lead healthy lifestyles so as to make fewer demands on the health care system.
Individuals with more education are more likely to vote and to be healthy and less likely to be involved in crime and to receive public assistance
For every additional high school graduate, annual spending on crime is reduced by $2049.
High school graduates reduce welfare public costs relative to non-graduates, amounting to lifetime savings of $4285 per graduate.
Impact on Local Wealth
IMPACT ON LOCAL WEALTH
There is a positive correlation between the higher spending from high school graduates (as compared to high school drop-outs) and local property values.
Homebuyers prefer to locate in localities with better quality schools, and they are willing to pay a higher price for the home to be in such a location.
Due to improving academic performance in WCPSS between 2015 and 2019, Wake County residential property values are approximately $11.8 billion higher than without the better academic results, and Wake County property tax revenues are higher by $103.8 million.
Summary
INPUTS
Every $1 spent and retained in Wake County by the WCPSS operating budget results in $1.71 of Wake County spending.
Every direct WCPSS job is associated with another 0.32 Wake County jobs.
Every $1 spent and retained in the region by the WCPSS capital budget results in $1.63 of Wake County spending.
Every $1 million spent by the WCPSS capital budget results in 11.7 Wake County jobs.
OUTPUTS
Each recent WCPSS graduating class generated between $2394 million and $2747 million in additional lifetime income.
As a result of improved academic performance of recent WCPSS graduates, their increased likelihood of completing college is valued at $20 million for the last five graduating classes.
Each recent WCPSS graduating class is associated with a lifetime reduction in public crime, welfare, and health care costs at near $1 billion.
The additional spending of each WCPSS graduating class adds $100 million to local property values.
The recent improvement in WCPSS academic performance is estimated to have resulted in Wake County residential property values that are $11.8 billion higher compared to levels without the improvement in academic performance.
WakeEd Partnership
3101 Industrial Drive, Suite 100
Raleigh, NC 27609 | (919) 821-7609
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WakeEd Partnership
3101 Industrial Drive, Suite 100
Raleigh, NC 27609 | (919) 821-7609