The Larger Costs from School Closures

Nobody is talking about schools resuming to normal in the fall, but the economic problems caused by the pandemic would not be solved even if they did.  In our recent OECD analysis,  we estimate that the cohort of K-12 students hit by the spring closures will face a loss of lifetime income of 3 percent or more if schools immediately return to their 2019 performance levels. If re-opening proves more difficult, the losses will increase proportionately.

The nation also faces a bleaker future.  The learning losses that have already accrued imply a lower growth in the future, because economic growth depends highly on the skills of the society.  By historical patterns, the school closures in the spring will lead to 1.5 percent lower average GDP for the remainder of the century.  In current USD, the lost GDP for Portugal will be USD 247 billion.   

Importantly, the school closures had highly variable impacts on student learning.  Some schools found ways to pivot to home-based learning.  Some parents found ways to substitute for the lessened role of schools.  But there is no doubt that the average student has suffered learning losses and that these will follow the student throughout life.

The lower learning will almost certainly be more detrimental for students whose parents are less ready to step in and substitute for the teachers.  Just closing the “digital divide” will not be sufficient to close the expanding achievement gap, because lower achieving students will need human help in adapting to new teaching modes. The widening spread in learning can be expected to be lead to even wider income gaps than exist today.

As schools experiment with varying re-opening strategies, any quick return to prior levels of student academic performance seems unlikely.  Added learning losses would simply compound the prior projections of the economic costs.

As the pandemic continues and as schools move to re-establish their programs, it is natural that considerable attention has focused on the mechanics and logistics of safe re-opening.  Even so, the long-term economic impacts also require prompt attention. The losses already suffered will require more than the best of currently-considered re-opening approaches.

Just getting back to pre-COVID levels of performance won’t do: the already-booked learning losses will go away only if the schools get better than they were before.  That is, however, not impossible.  Research points a way through the COVID thicket, a way that capitalizes on the pandemic-induced alterations in the traditional school.

Schools are rapidly moving to new modes of instruction that include different doses of on-line work, asynchronous class presentations, and in-person instruction.  Past research has shown highly variable effectiveness of teachers, and this variation is likely to be amplified with some teachers being more effective in-person and some being superior at on-line work.  If schools moved to utilizing teachers where they were more effective, the improved instructional environment could lead to better performance of the schools, ameliorating the existing learning losses.  For example, the superior on-line teachers could take on more students with this expansion compensated for by more support or simply higher compensation.

Additionally, with the almost certain widening of learning differences within individual classes after re-opening, a move toward more individualized instruction would benefit students.  Students would seek mastery of topics, and students within a classroom can be working on different goals.  With such individualization, all can be better off.

Re-opening of schools is presenting new challenges.  Regardless of the approach taken, the huge economic losses associated with lost learning must be addressed, and the best of the currently discussed re-opening models are insufficient to deal with the mounting learning deficits.

Eric A. Hanushek is a senior fellow at the Hoover Institution of Stanford University and Ludger Woessmann is professor of economics at the University of Munich.  Their analysis was published today by the OECD (link).