The National Center for Education Statistics (NCES), a component of the U.S. Department of Education’s Institute of Education Statistics, recently released “Projections of Education Statistics to 2018,” the latest in a series of annual reports that first started in 1964.  William Hussar, a financial economist with NCES, who co-authored the report, recently spoke with MuniNetGuide about the highlights of this year’s projections for public school enrollment through 2018.

MuniNet:   In looking at big-picture trends reported in the current “Projection of Education Statistics,” what stands out as most notable to you?  

Hussar:  In response to a growing number of requests over the years, for the first time, the Projections of Education Statistics to 2018, NCES includes projections of first-time freshmen enrollment in degree-granting institutions.  

We are continuing to forecast increases in enrollment in degree-granting institutions. These increases are projected for most age categories, including those 18 to 24, even though population for that age category is projected to decline.

There continues to be substantial differences by region in the trends for public elementary and secondary enrollment and high school enrollment. For example, enrollment in the Northeast is projected to decline 5.4 percent from 2006 through 2018 while it is projected to increase 18 percent in the South and 14.7 percent in the West.

MuniNet:  How are projections in enrollment trends determined – and how do current economic conditions affect these estimates?

Hussar:  Specifically, our state enrollment projections are dependent on two factors: the trends in the grade-by-grade enrollments by state as shown from the Common Core of Data (CCD), and the population projections for 5- and 6-year-olds produced by the Census Bureau.  These projections are not able to reflect the impact of economic difficulties, like the mortgage crisis and recession, because of the lag between when these pressures are experienced and when they can be reported.

“…enrollment in the Northeast is projected to decline 5.4 percent from 2006 through 2018 while it is projected to increase 18 percent in the South and 14.7 percent in the West.”

MuniNet:   That said, how can people who use these projections adjust them to account for demographic changes that take place as a result of economy-induced population shifts?

Hussar:  First, if the user has a good idea of how the demography might change, they could simply adjust the NCES projections directly.  For example, if the user thought that number of school-age children were to have a one-time decrease of one percent, he/she could decrease all the projections by one percent.

I would also recommend that people check to see if there is a state or local organization that produces its own enrollment projections. These projections might be based on more recent data than the NCES projections and would be done by people who have a better knowledge of local conditions. NCES produces its state productions to provide researchers, policy analysts and others with state-level projections developed using a consistent methodology.

MuniNet:  The report points to an increase in per pupil expenditures between the 2005-06 and 2018-19 school years, though at a slower rate than total expenditures … why is that?

Hussar:  The Projection of Education Statistics points to an expected increase in overall expenditures of between 31 (low estimate) and 40 (high estimate) percent.  We are forecasting that expenditures per pupil are going to increase for that same period, but at a slower rate:  19 percent on the low side, and 27 percent for the high estimate.  The per-pupil forecasts are lower because we are forecasting that elementary and secondary enrollment is going to increase. 

It is important to note that the Projections report examines one measure of expenditures: current expenditures.  “Current expenditures” includes expenditures for operating local public schools and school districts, and excludes capital outlay, interest on school debt, and programs outside of public elementary and secondary education.

Also, while the tables of the Projection of Education Statistics to 2018 report presents both expenditure data that has not been adjusted for inflation (i.e. in current dollars) and expenditures data that has been adjusted for inflation (i.e. in constant dollars), the emphasis in the text is on expenditures that has been adjusted for inflation. Hence the percentage increases that I listed above are for expenditures per pupil that have been adjusted for inflation.  Also, when we produce our projections, we use inflation-adjusted expenditures.

MuniNet:  Do increases in expenditures tend match other economic indicators, including cost of living trends?

Hussar:  The trend for education expenditures is generally similar to that for some other general economic measures such as the gross national product and national income. We use that tendency as we develop our projections of current expenditures per pupil.  With the Projections of Education Statistics to 2018, we used forecasts of a measure of the economic condition – disposable income per person – as we developed our forecasts for per pupil expenditures.  Both disposable income per person and per-pupil expenditures were adjusted for inflation.

If you look at the long-term trend for inflation adjusted current expenditures per pupil, you can see the effect of the economy on expenditures. Column 9 of table 181 of the Digest of Education Statistics, 2008 shows the trend for inflation-adjusted current expenditures per pupil going back to the early part of the 20th century. Note that for most of the period, current expenditures per pupil is steadily increasing. The two periods when current expenditures per pupil fell were in the late 1970s and early 1980 and the early 1990s, both periods when the economy was in a downturn.

MuniNet:  Many schools are being forced to make budget costs due to local government tax shortfalls; what effect would this have on per-pupil expenditures?

Hussar:  Unless revenues are available from other sources, such as states and federal government, expenditures per pupil would decline.

MuniNet:  Is there a correlation between what districts spend (total, or per pupil) and student performance, as measured by standard benchmarks?

Hussar:  There has been much research into the issue of the correlation between the inputs for education and student performance.  As of yet, there has not been a clear consensus to the size – and perhaps even the existence – of this correlation.     

About the Expert

William Hussar is a Financial Economist with the National Center for Education Statistics, the federal agency responsible for collecting and analyzing data for education.

Doctor Hussar attended Boston College as an undergraduate, receiving a Bachelor of Arts degree in Mathematics and Economic. Subsequently, he was a graduate student in economics at the University of Maryland, College Park where he received a Ph.D. Since receiving his degree, he has worked as a Financial Economist at the National Center for Education Statistics, where he works on two annual reports, the Projections of Education Statistics and the Condition of Education.