‘It’s high stakes’: the real cost of dropping out of school

Madi Craig knew she was at risk of dropping out of school.

She struggled with tests during high school. And then, in year 10, she fell further behind after her single mother had a heart attack and was rushed to hospital. She refused to leave her mum’s side for three weeks.

Madi Craig says she was at risk of disengaging from high school but perservered with the help of the Smith Family.
Madi Craig says she was at risk of disengaging from high school but perservered with the help of the Smith Family.  Photo: Pat Scala

“I thought that school wasn’t for me,” she said. “I didn’t have that role model who went through school because mum dropped out of school.”

Disengaged young Australians are costing taxpayers a staggering $18.8 billion by increasing crime, clogging health services, relying on welfare and reducing tax revenue.

That’s the finding of a report by Victoria University’s Mitchell Institute which highlights the grim consequences and cost of one in eight Australians never attaining a year 12 qualification.

Many of these people are from disadvantaged backgrounds and make up the one in eight Australians who are long-term unemployed.


Victoria University vice-chancellor Professor Peter Dawkins said schools were failing to engage students and needed to have a greater focus on life skills.

“We really need to take this seriously because it’s high stakes for the economy and the community,” he said.


The Counting the costs of lost opportunity in Australian education report, by Stephen Lamb and Shuyan Huo, found that a disengaged 24-year-old, who is unemployed and doesn’t have a qualification, costs taxpayers $10,300 a year. This amounts to $411,700 over their lifetime, and $18.8 billion across the lifetime of the 46,000 young Australians who were disengaged in 2014.

The social cost is even greater. It includes lost earnings and personal medical costs and is estimated at $50.5 billion across this group.

“Every student who fails to complete year 12 or equivalent qualifications, or every young person who is not able to actively engage in work or study after they leave school, produces a direct cost on Australian taxpayers and government through lower tax revenues, higher dependence on public health and higher costs on crime and law enforcement system,” the report said.

There is a link between dropping out of school and criminality.

Only 14 per cent of 25 to 34-year-olds entering prison in 2009 had a year 12 qualification compared to 63 per cent of the general population.

And Australians without qualifications were twice as likely to live in families dependent on government income support.

Foundation of Young Australians chief executive Jan Owens said a one-size-fits-all approach to education was failing young people.

“We urgently need to transform the entire school and higher education learning experience so that it better prepares students for a changing and uncertain future world of work,” she said.

She said young people needed to learn skills like digital literacy, critical thinking, creativity, collaboration, and an entrepreneurial mindset.

Smith Family chief executive Lisa O’Brien said supporting a disadvantaged child’s education was “one of the most effective ways to help them break the poverty cycle”. “.

Fortunately things have improved for Madi.

She was supported through high school by the Smith Family’s Learning for Life program, which took financial pressure off her mother by paying for excursions and school items. It also let Madi choose the electives that she wanted instead of “picking the cheaper ones because that’s all we could afford”.

There was an upside to her mum’s stressful stint in hospital – it inspired Madi to pursue a career in nursing.

She embarked on a nursing degree, and her Smith Family sponsorship paid for university essentials like textbooks and her scrubs. The 22-year-old Indigenous woman is now working in her “dream job” as a mental health nurse.

“I had someone who believed in me,” she said.

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An educator from Armidale, NSW, Australia.... I have been teaching for over fifteen years and I have been teaching Science for the last 4 years. Why Boys' education -- I feel boys are often left out of education policy development...... I am into technology, but have loads of things to learn.... all my rants here are my personal opinions

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