Announcing the Ford PAS and Ford NGL Thought Leader Series

This month’s topic:
Outlining the financial benefits and positive outcomes of career academies and demonstrating how they more than justify the investments in building a career academy network.

By Richard K. Delano, Ford Motor Company Fund Advisory Council

Can you think of a high school reform strategy your district can adopt that will increase revenues and reduce expenses? If you are stumped, then consider career academies, which are smaller learning communities centered on business career themes that bring relevance to academic subjects and turn high school students into eager learners. This article will show how a modest investment in career academies can deliver dividends next year and continue to pay off over time.

If your community is fortunate enough to have launched a network of career academies, this article will help your leaders understand the positive financial rewards of maintaining your commitment in these turbulent times.

New Financial Revenues for Your School District and Your Community
Students of successful career academies tend to attend high school regularly because they find the academic courses more relevant and they enjoy the sense of “family” that is part of the smaller learning community experience. In many states like Texas, California, Florida, and Arizona, where local taxes are aggregated to the state capitol and redistributed to school districts, better attendance equals higher revenues—much higher revenues.

In Sacramento City district in northern California, where most of the district’s 12,000 high school students are participating in career-themed smaller learning communities, higher attendance has translated to approximately $54 million over the last four years. According to Mike Burnelle, district Career and Technical Education director, this is the financial reward of cutting its drop-out rate from 24 percent to 14 percent and attracting more than 700 out-of-district students each year to the career academies of Sacramento City.

A successful career academy network has the potential to align and expand business support for the school district. Because of career academies, businesses can more clearly see the connection between K–12 education and workforce development. Two examples of this business alignment can be found in the support that Coachella Valley’s health career academies enjoy from the health sector and the support that the 30 career academies of Philadelphia Academies, Inc., receive from the city’s business community. In both cases, career academies represent a powerful magnet for attracting new revenues to support schools and community prosperity.

Career academies also offer positive economic development opportunities for communities. According to a 15-year study of career academy students by the MDRC, a New York-based research company, career academies had the most positive impact on young men, a group that has experienced a severe decline in real earnings in recent years. Through a combination of increased wages, hours worked, and employment stability, real earnings for young men (who were 85 percent minority and poor) in the career academy group increased by $3,731 (17 percent) per year—or nearly $30,000 over eight years.

Reducing School District and Community Expenses
Not only can successful career academy networks generate positive financial gains for school districts and communities, as well as individuals, they can help reduce costs as school districts increase the number of students in career academies.

The Ford Motor Company Fund Advisory Council is in the process of collecting data on the level of improvement noted in each of the following observations:

• Career academy students tend to need less academic remediation and gain English language proficiency more rapidly, potentially reducing the number of remediation teachers employed by the district.
• Students of career academies are less likely to be expelled or suspended, potentially reducing the amount of administrative time devoted to discipline issues.
• Teachers in career academies tend to be highly satisfied, which may result in reduced teacher turnover.
• Career academy students need significantly less academic remediation when going on to community college.

Career academies can also reduce costs for the larger community. Researchers note that the lifetime cost of a single high school dropout (in terms of increased social costs borne by federal, state, and local governments) is $260,000. Multiply that by the number of young people not graduating from a high school annually and one can calculate the “cost of place” that prospective new businesses assess when evaluating a community for relocation or expansion.

In the MDRC study noted above, the career academies produced an increase in the percentage of young people living independently with a spouse or partner and children. Young men also experienced positive impacts on marriage and being custodial parents.

What Does It Cost to Build a Successful Career Academy Network?
Let’s start by examining the incremental costs of a typical career academy. Remember, in an academy, approximately 300 students are learning together with a team of academic and technical teachers. A comprehensive high school of 2,000 students might have three or more career academies. Following are the key ingredients of a successful career academy and its potential cost factors. We assume in this example that the district has already invested in career and technical teachers who are part of a career academy team.

• Career academy leader. One of the academy teachers needs to lead the academy and should receive partial release time from her or his teaching duties. We recommend 50 percent release time. This is an expense to the district that could range from $25,000 to $35,000 per academy. In high schools with multiple academies, one academy leader with release time often leads several academies.
• Cohort scheduling. The career academy students need to be scheduled together with the team of teachers. This may result in limited additional administrative time devoted to master-scheduling the students into the Academies.
• Professional development. Academic teachers benefit from professional development that helps them integrate the technical themes into their academic coursework and learn to teach using a problem- and inquiry-based pedagogy. Typically, districts budget for professional development. Federal Carl B. Perkins funding can be applied to this task.

A growing career academy network benefits from hiring a small team of individuals we call “career cluster entrepreneurs” to coordinate business support for career academies and to convene employer-educator councils to align workforce pathways. In the Sacramento City example, five career cluster entrepreneurs coordinate business support for the nearly 12,000 students at a cost of approximately $600,000 each year. These district staffers annually raise more than $1.2 million from the business community in both cash and equipment donations, and they coordinate thousands of hours of volunteer time.

A more complete “financial calculator” is under consideration by the Ford Motor Company Fund Advisory Council and we continue to increase our understanding of this topic as more communities experience and report on the positive financial benefits of building career academy networks. In the meantime, we encourage communities to envision the financial well-being of their communities five years from now when a large portion of their high school population is learning in a successful career academy network.

With the right ingredients, as noted above, as well as reasonable and consistent investments in a career academy network today, districts and communities can reap big rewards in the future, including:

• a more educated and stable workforce
• a greater ability to attract new business to communities, as well as to sustain current business interest in an area
• reduced drop-out rates
• increased graduation rates
• greater earnings among graduating students
• increased readiness for college
• reduced expenses in remediation and administration
• and much more.

With results like that, it’s easy to make the case for career academies.

Previous Thought Leader Essays:
Reinventing the Workforce and Bolstering the Economy through Career Academies and More Relevant High Schools
By Cheryl Carrier, Program Director, 21st Century Education Programs, Ford Motor Company Fund