Not making the grade is a recipe for failure

Published 9:00 pm Saturday, October 8, 2005

There are half a million high school seniors in California. Some of them are just like the sun-kissed kids on television’s “Laguna Beach” – camera ready, comfortable with themselves, and confident about what life has in store for them.

Some seniors in California high schools, though, don’t fit that profile. Approximately 100,000 of them have flunked the state’s graduation exam and face an uncertain future. They may not earn their high school diplomas.

California’s high school graduation exam isn’t incredibly demanding. To pass, a student has to demonstrate eighth-grade math skills and a level of English proficiency that tracks to about midway between ninth and 10th grade. So it is not a question of setting the bar too high.

The experts are busy analyzing and interpreting the exam’s failure rate, but from an economic standpoint, it is safe to say that these young people who tanked it either lack the basic skills needed for employment or are not motivated to demonstrate them. Either way, most employers would not consider hiring them. They are not qualified for most jobs in today’s economy.

Basic skills and specific job skills are very much an issue in the recovery and rebuilding of the Gulf Coast communities, especially New Orleans. The federal government alone will be spending a minimum of $60 billion, and when state, local and private spending amounts are rolled in, we are talking about a bonanza for the construction industry and related building trades.

Traditionally, construction has been a destination port for the high school graduate who doesn’t plan to go on to college. Construction trades once were very forgiving of academic shortcomings, and it was possible to earn a good living even though you weren’t too comfortable with participial phrases or algebraic functions.

But the world has changed. Even ordinary tradesmen and service-sector workers are required to understand and use math. And while most of us can still manage to get through the day without worrying too much about participles versus gerunds, grammar has become increasingly important throughout the economy.

Communications and instructions are now commonly written – on computer screens, mostly – and even entry-level workers are expected to understand their embedded logic.

The modern construction job and its education demands will be very much center stage in the Katrina-Rita rebuilding effort. To jump-start the recovery, the Bush administration has tried to clear away some regulatory obstacles. Among other things, it has suspended the Davis-Bacon Act of 1931, which requires that federally-funded construction projects pay workers the “prevailing wage.”

Davis-Bacon wage provisions have provided considerable fuel for academic and political arguments over the years. Because prevailing wage has morphed in most large cities to “union wage,” critics believe that Davis-Bacon has added substantially to the cost of public projects. On the other hand, one forward-looking provision of the act requires a proportion of the wages paid be used to fund apprenticeship and training programs, which have, over the years, opened a lot of doors for people and probably advanced the overall skill level of the construction trades.

Because we are just beginning the rebuilding process, it is not certain what the economic effects of suspending the Davis-Bacon Act will be. Professor Peter Philips of the University of Utah believes that a lot will depend on how long the suspension is in place.

“The Davis-Bacon suspensions we’ve had in the past have all been fairly brief and brought no lasting economic changes to construction markets or the composition of the work force,” he said. “A longer suspension, though, would have some very visible and significant effects.”

The type of rebuilding contracts used will be a major determinant of any short-term or lasting economic effects.

Philips says: “There are two offsetting forces involved. The lifting of the Davis-Bacon prevailing wage provision will drive competing construction firms to focus on cutting wages and benefits. Contracts that emphasize performance incentives and late penalties, though, will force competing firms to focus instead on reliable, skilled labor.”

Of most concern to Philips would be a prolonged drought of money flowing into apprenticeship and training programs for local workers.

“These programs are the future of the skilled labor force in the building trades. You’re eating your seed corn when you cut them out,” he says.

In the end, the final grade given to the Katrina-Rita recovery will come down to the effectiveness of the work force employed. And we know that the key to an efficient, productive work force is education – whether it comes from high schools or training programs.

California’s troubles with their high school graduation standards are a warning signal for all of us. If we care about our economy, the hurricane damage isn’t the only thing that needs cleaning up.

James McCusker is a Bothell economist, educator and consultant. He also writes “Business 101,” which appears monthly in The Snohomish County Business Journal.