What budget cuts during the Great Recession did to pupils’ test scores

June 06, 2019

By Tamara Gilkes Borr

Lawmakers sometimes cut education budgets in the hope of forcing schools to become more efficient. Given the difficulty of measuring the effects of education spending on test scores, it can be hard to know whether this is as bad an idea as, at first glance, it might seem to be. Yet America ran a large, albeit unintended, experiment along these lines in 2007-09, when school budgets were cut during the recession. What happened to the pupils?

According to a study by Kirabo Jackson of Northwestern University and his colleagues, recession-era budget cuts did lead to lower maths and reading scores. Imagine that a school district replaced all its average teachers with near-bottom-quality teachers. Mr Jackson says that the recession had a similar effect on pupil scores. The researchers also found that the budget cuts during the recession reduced graduation rates. A 10% reduction in spending per-pupil in all four years of high school reduced the likelihood of a student graduating by 2.7 percentage points.