Introduction

Dropping out of high school is related to a number of negative outcomes. For example, the median income of high school dropouts age 18 and over was $12,184 in 2003 (U.S. Census Bureau 2005). By comparison, the median income of those age 18 and over who completed their education with a high school credential (including a General Educational Development (GED) certificate) was $20,431. Dropouts are also less likely to be in the labor force than those with a high school credential or higher, and are more likely to be unemployed if they are in the labor force (Bureau of Labor Statistics 2004). In terms of health, dropouts over the age of 24 tend to report being in worse health than adults who are not dropouts, regardless of income (U.S. Department of Education 2004). Dropouts also make up disproportionately higher percentages of the nation's prison and death row inmates.¹

This report builds upon a series of National Center for Education Statistics (NCES) reports on high school dropout and completion rates that began in 1988. It presents estimates of rates in 2002 and 2003, provides data about trends² in dropout and completion rates over the last three decades, and examines the characteristics of high school dropouts and high school completers in 2002 and 2003. Four rates are presented to provide a broad picture of high school dropouts and completers in the United States, with each contributing unique information: the event dropout rate, the status dropout rate, the status completion rate, and the averaged freshman graduation rate—an indicator new to this report series.

• The event dropout rate estimates the percentage of both private and public high school students who left high school between the beginning of one school year and the beginning of the next without earning a high school diploma or its equivalent (e.g., a General Educational Development certificate, or GED). It can be used to track annual changes in the experiences of students in the U.S. school system.
• The status dropout rate reports the percentage of individuals in a given age range who are not in school and have not earned a high school diploma or equivalency credential, irrespective of when they dropped out. The rate focuses on an overall age group as opposed to individuals in the U.S. school system, so it can be used to study general population issues.
• The status completion rate indicates the percentage of individuals in a given age range who are not in high school and who have earned a high school diploma or equivalency credential, irrespective of when the credential was earned. The rate focuses on an overall age group as opposed to individuals in the U.S. school system, so it can be used to study general population issues.³
• The averaged freshman graduation rate estimates the proportion of high school freshmen who graduate with a regular diploma 4 years after starting 9th grade. The rate focuses on public high school students as opposed to all high school students or the general population and is designed to provide an estimate of on-time graduation from high school. Thus, it provides a measure of the extent to which public high schools are graduating students within the expected period of four years.

Data presented in this report are drawn from the annual October Current Population Survey (CPS), the annual Common Core of Data (CCD) collections, and the annual GED Testing Service (GEDTS) statistical reports.⁴ Data in the CPS files are collected through household interviews and are representative of the civilian, noninstitutionalized population in the United States. The CCD data are collected from state education agencies about all public schools and school systems in the United States, and contain administrative record data that are representative of all public school students in this country. The GEDTS data are also built from administrative record data, and contain information about all GED test takers (data presented in this report are only for test takers in the 50 states and the District of Columbia).

As with all data collections, those used in this report are useful for calculating some estimates but are poorly suited for calculating other types of estimates. For example, CPS data are well suited for studying the civilian, noninstitutionalized population in the United States, but do not provide information about military personnel or individuals residing in group quarters such as prison inmates. Data from CCD are appropriate for studying public school students in a given year, but do not provide information on private school students. GEDTS data are helpful for identifying the number of people who take and pass the GED examination in a given year, but do not contain information about schools that GED test takers attended before taking the GED test. In addition, none of the data sets track individual students over time, limiting their usefulness for studying processes and precise timelines associated with graduating or dropping out. Note that the CCD data for high school dropouts in the 2002-03 school year were not available at the time this report was written. However, diploma data for the 2002-03 school year were available, which is why 2002-03 averaged freshman graduation rates are presented, but not state-level public high school event dropout rates.

All changes or differences noted in this report are statistically significant at the p ≤ .05 level. When significance tests fail to meet the p ≤ .05 criterion and the comparison is of substantive interest, terminology such as "no measurable difference was found" is used in this report. This does not necessarily mean that there is no actual difference between the compared estimates. With a larger sample, the difference may have tested significant at the p ≤ .05 level.

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¹ Estimates indicate that approximately 30 percent of federal inmates, 40 percent of state prison inmates, and 50 percent of persons on death row are high school dropouts (U.S. Department of Justice 2000, 2002).
² Trend analyses have shown a pattern of decline prior to 1990 and little or no trend since then for dropout rates. As a result, in this E.D. TAB, overall trends from 1972 to 2003 are reported, as well as separate trends from 1972 to 1990 and 1990 to 2003, to increase the understanding of patterns over time in these rates.
³ This rate is referred to as the "Current Population Survey High School Completion Indicator" in an upcoming technical report being developed by NCES (Seastrom et al. 2006).
⁴ Appendix A of this report contains information about these three data collections and describes in detail how the rates reported here were computed.