1. Americas Perfect Storm Irwin Kirsch ETS National Coalition for Literacy February 7, 2008

2. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/20132 Three Forces Are Changing Our Nations Future Inadequate literacy and numeracy skills among large segments of our student and adult populations An ongoing shift in the demographic profile of our population, powered by the highest immigration rates in nearly a century The continuing evolution of the economy and the nations job structure, requiring higher levels of skills from an increasing proportion of workers

3. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/20133 Inadequate Skill Distributions

4. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/20134 Literacy surveys conducted by ETS have represented literacy along scales divided into 5 levels. National and international committees have judged that skills in Levels 3 and higher are needed for participation in modern societies. Less ProficientMore Proficient National Adult Literacy Survey (NALS, 1992)

5. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/20135 150 200 250 300 350 177, 0-8 years of schooling 231, 9-12 years of schooling 270;268, HS Diploma; GED 294, some college 308, 2-yearr degree 322, 4-year degree 336, graduate degree < Level 1 Level 1 Level 2 Level 3 Level 4 Literacy skills are related to highest level of educational attainment

6. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/20136 27 58 88 98 Level 1 Level 2 Level 3Level 4 Level 5 Percentage- Passing GED SOURCE: The Literacy Proficiencies of GED Examinees: Results from the GED-NALS Comparison Study. (1995). Baldwin, J., Kirsch, I., Rock, D., & Yamamoto, K. ** Adults in Levels 3 and higher had a better than 90 percent chance of passing the GED.

7. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/20137 Mean Prose Proficiencies of Employed U.S. Adults and Their Percentile Ranks on the International Prose Distribution, by Major Occupational Group Occupational Group Mean Score Percentile Rank on International Scale U.S. Rank Among 19 High-Income Countries Managers and professionals31677 nd 3 rd Technical and associated professionals31376th2 nd Clerical and administrative support29162 nd 10 th Service and lower-level sales26946 th 15 th Craft workers24531 st 16 th Assemblers and operatives24431 st 13 th (tie) Laborers and agricultural/fishery workers24230 th 15 th Source: IALS Survey. 1994

8. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/20138 Percentage of Adults 16-65 Years Old at: Level 1Level 2Level 3Levels 4/5 All AdultsAsianBlackHispanic White Half of Americas adults lack literacy skills needed for the 21st century. Level 1Level 2Level 3Levels 4/5

9. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/20139 High School Graduation rates peaked at 77% in 1969 and have remained in the 70% range since 1995. Graduates as a Percentage of 17-Year-Old Population Graduates are of regular day-school programs. Source: U.S. Department of Education, National Center for Education Statistics

10. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201310 Reading scores have remained flat since the release of A Nation at Risk report in 1983. Math scores have fared only slightly better than reading. NAEP Assessment Years Reading 1984199019962004 Age 13257 258259 Age 17289290288285 Math1986199219962004 Age 13269*273*274*281 Age 17302*307 * Significantly different from 2004

11. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201311 Average achievement gaps in both reading and math have remained stubbornly unchanged. Reading 198419942004 White-Black Age 132631*22 Age 17323029 White-Hispanic Age 132330*24 Age 17273329 Math 198619962004 White-Black Age 13242927 Age 17292728 White-Hispanic Age 13192523 Age 17242124 * Significantly different from 2004

12. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201312 MathReadingScience U.S. Average Score483495491 OECD Average500494500 U.S. Rank Among 29 Countries 24 th 15 th 20 th The U.S. is not among the worlds leaders in any area of educational achievement.

13. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201313 Source: International Adult Literacy Survey (IALS): tabulations by authors. Age Group Mean Score Percentile Rank of Mean Score on IALS Scale U.S. Rank 162527852 nd 14 th (tie) 263527550th11 th (tie) 364528456 th 5 th 465527752 nd 3 rd 566526644 th 2nd Mean Prose, Document and Quantitative Scores of U.S. Adults in Selected Age Groups and Their Rank Among 19 Countries in the IALS Assessment

14. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201314 Shifting Demographics

15. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201315 Growth 1980-2000 Growth 2000-2020 Natives, 25-54, All races26.70.0 Natives 55+, All races2.713.3 Immigrants9.36.0 TOTAL38.719.4 Numbers represent millions of adults Americas labor force will grow more slowly over the next 20 years, with almost none of the growth expected to come from native-born workers.

16. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201316 Time Period Population Growth (millions) Net International Migration (millions) Net Immigration as a Percentage of Population Change April 2000 – July 2005 (Actual) 15.06.342 2005–2010 Projected13.46.750 2011-2015 Projected13.47.153 Immigration is projected to account for more than half of our population growth between now an 2015.

17. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201317 Immigration patterns have changed dramatically over the past 100 years. New immigrants to the U.S. are quite diverse with respect to their country of origin. 0% 20% 40% 60% 80% 100% 1820–19401951–601971–801991-96 Years Proportions Asia Central/South America Canada Europe Australia and New Zealand Africa

18. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201318 Educational Attainment Number (millions) Percentage 1-12 years, no diploma1.734 high school diploma or GED1.123 13-15 years.815 Bachelors degree.817 Masters or higher degree.611 Total5.0100 Between 2000-2004 new immigrants 18 years of age and older entered the U.S. with a broad range of educational backgrounds

19. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201319 Educational Attainment Only Speaks English (%) Speaks English Very Well (%) Speaks English Well (%) Does Not Speak English Well (%) Does Not Speak English (%) 1-12 years, no diploma 6693247 High school diploma or GED 916193621 13-15 years163024219 Bachelors degree 143628175 Masters or higher degree 114827123 Total1022192623 80% of new immigrants without a high school diploma report that they do not speak English well or at all.

20. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201320 Educational Attainment Total Births Out-of-Wedlock Births Percentage Out of Wedlock <12 or 12, no diploma563,288350,84762.2 12 years, diploma or GED 743,151381,06051.3 13-15 Years666,328242,92036.7 Bachelors degree268,23833,66912.6 Masters or higher degree 62,3132,691 4.3 All2,298,3181,011,07744.0 Source: 2004 American Community Surveys; public-use files; tabulations by authors. 44% of births to women under 30 are out of wedlock. The majority of these births take place among women with either no high school diploma or no postsecondary education

21. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201321 A Changing Economy

22. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201322 Occupational group 1984 millions 2000 millions Absolute change in millions of adults Percentage change All 16+105.0135.030.029.0 High literacy 34.0 54.020.057.0 Moderate literacy 70.0 80.010.014.3 Jobs associated with college-level skills and education accounted for two-thirds of the job growth between 1984 and 2000.

23. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201323 Occupational group 2004 millions 2014 millions Absolute change in millions of adults Percentage change All 16+146.0165.019.013.0 High literacy49.058.09.018.0 Moderate literacy97.0107.010.0 Jobs requiring high levels of education and skills are projected to account for almost half of the job growth over the next decade.

24. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201324 Educational Attainment 1979 (millions) 2004 (millions) Percentage change No HS diploma or GED1.5.96-39.0 HS diploma or GED1.81.4-23.0 1-3 years of college; AA degree2.01.7-13.0 Bachelors degree2.7362.702-1.2 Masters or higher degree3.03.515.0 All1.8791.9021.2 The expected lifetime earnings of males have changed dramatically between 1979 and 2004 resulting in a growing inequality favoring those with higher levels of education. Educational Attainment 19792004 HS vs. College50%96% College vs. Grad.11%30% HS vs. Grad 67% 254%

25. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201325 Wage and salary earnings reflected a shared prosperity through 1975. Between then and now we have seen a growing inequality. Percentage Change in Earnings Since 1961 Tabulations of annual March Current Population Survey Data, by David Ellwood, Harvard University.

26. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201326 What might the future look like?

27. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201327 70 million adults in levels 1/2 Distribution of Literacy Scores Found in the National Adult Literacy Survey (1992) Less ProficientMore Proficient

28. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201328 70 million increase to 119 million in 2030 Less ProficientMore Proficient Average literacy scores are expected to decline between 1992 and 2030, with an increase in the amount of inequality. Less ProficientMore Proficient

29. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201329 Over the next 25 years or so, as better-educated individuals leave the workforce they will be replaced by those who, on average, have lower levels of education and skill. Over this same period, nearly half of the projected job growth will be concentrated in occupations associated with higher education and skill levels. This means that tens of millions more of our students and adults will be less able to qualify for higher paying jobs. Instead, they will be competing not only with each other and millions of newly arrived immigrants but also with equally (or better) skilled workers in lower wage economies around the world. The formidable challenge for Americans will not be finding jobs, it will be finding ones that pay living wages and provide opportunities.

30. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201330 Do we have to accept a future with increasing economic and social polarization? The answer is no provided we are willing to invest in policies that will improve the literacy and numeracy skills of all residents. While new policies focusing only on education and skills will not solve all the challenges associated with existing inequalities, without a human capital agenda there is little chance of improving economic opportunities among key segments of our population. We need to understand that it is both the growth of human capital and how it is distributed that is important for America

31. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201331 So what happens if we fail to take serious actions? Neither our economy nor our society faces imminent collapse. However, we are likely to witness a more subtle danger one where we find ourselves slowly losing ground relative to other countries while becoming more socially and economically divided. And, if that happens more than our standard of living is at stake. Benjamin Friedman in his book The Moral Consequences of Economic Growth links our economic well being to the fabric of our society.

32. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201332 Let us not be content to wait and see what will happen, but give us the determination to make the right things happen. Horace Mann

33. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201333 For more information contact: Irwin Kirsch ETS Princeton, NJ 08541 e-mail: ikirsch@ets.org Office: (609) 734-1516 www.ets.org/stormreport

34. Confidential and Proprietary. Copyright © 2007 by Educational Testing Service. All rights reserved. 12/18/201334