A Quick Review of the Economic Impact of Spokane County School Districts

A Quick Review of the Economic Impact of Spokane County School Districts Presentation to Greater Spokane Inc. January 2026

Two goals of the analysis • To compile the amount of direct spending by the 13 public school districts in Spokane County – To place this spending in the context of the economy of the county – No economic “impact” in traditional sense, as model cannot separate higher ed from K-12 – Consequently, no “ripple” effects taken into account

• To review the latest research on the earnings "premium" of some post-secondary education or training over a high school diploma or equivalent

Methodology • Collected and summarized data from the Washington Office of Public Instruction (OSPI), validated by correspondence with school districts.

• Gathered data for the last three complete school years to check for any trends and to accommodate any extraordinary annual changes.

• Compared totals to County’s labor market and GDP data (Adjusted GDP figures from 2022 and 2023 to 2017 dollars)

Data Sources • U.S. Bureau of Economic Analysis: GDP and Personal Income Interactive Data Tables • U.S. Census Bureau: American Community Survey (ACS)

• U.S. Census Bureau: QWI Explorer • Washington Employment Security Department: Quarterly Census of Employment and Wages (QCEW)

• Washington Office of Superintendent of Public Instruction: F196 Reports and Personnel Summary Profiles

Aggregate results

Average annual employment for Spokane County school districts Combined District Headcount and Share of County Workforce

• School districts, in total, employ lots of people

15,000

10.0%

13,500

9.0%

12,000

• As a share of all workers who are part of the UI system, a bit < 5%

Combined District Headcount

• Count has been stable

8.0% 10,751

10,717

10,895

10,788

10,500

7.0%

9,000

6.0%

7,500

4.5%

4.4%

4.5%

4.5%

5.0%

6,000

4.0%

4,500

3.0%

3,000

2.0%

1,500

1.0%

0

0.0% 2021-2022

2022-2023

Headcount Workforce

2023-2024 Share of Workers

Average

Aggregate results

Rank of County’s largest 10 sectors by employment, average 2022-2024 Top 10 Sectors in Spokane County by Employment

• How big?

50,000 46,150 45,000

• SDs certainly don’t employ as many as healthcare, government or retail…

Annual Average Employment

40,000 35,833 35,000 30,000 26,476 25,000

20,000

16,269 15,000 10,000

• But they rank 9th recently

20,468

5,000 0

14,233 13,069 11,852 10,788 10,782

Aggregate results

Total wages paid by school districts • No benefits included in these numbers, simply annual wage earnings

Combined District Wages Paid and Their Share of County Wages $1,000

10.0%

$900

9.0%

• Some upward trend

• Average share of all wage earnings observed in Spokane County a bit > 5% – This share higher than share of employment -> average earnings in K-12 districts > average earnings for the “typical” county worker

Combined Wages Paid (in Millions)

$732

$781

$818

$777

$800

8.0%

$700

7.0%

$600

5.2%

6.0% 5.2%

5.1%

5.2%

$500

5.0%

$400

4.0%

$300

3.0%

$200

2.0%

$100

1.0%

$0

0.0% 2021-2022

2022-2023

Combined District Wages

2023-2024

Average

Share of All Wages

Aggregate results

Ranking of Spokane Couty’s 10 largest sectors annual wages paid in 2022-2024

• Where do the districts line up? 9th largest sector in county recently • Still, their wage earnings dwarfed by healthcare & other government

Total Wages in Ten-Millions x 10000000

Top 10 Industries in Spokane County by Annual Wages $350 $300

$291.8 $264.5

$250 $200 $150 $100

$115.2 $110.3 $106.2 $99.0

$95.1

$81.1

$77.7 $70.0

$50 $0

Aggregate results

Total expenditures by school districts & as a share of county GDP Combined District Expenditures and Share of County GDP (PCE 2017 dollars)

• Recent average = $1.5B

$1.80

• Share over two years? ~5% • Findings consistent with districts’ shares as measured by headcount or total earnings

Combined Expenditures (in Billions)

$1.60

10.0% $1.49

$1.57

$1.51

$1.47

9.0% 8.0%

$1.40

7.0%

$1.20

6.0% $1.00

4.9%

5.0%

4.9% 5.0%

$0.80

4.0% $0.60

3.0%

$0.40

2.0%

$0.20

1.0%

$0.00

0.0% 2021-2022

2022-2023

Combined Total Expenditures

2023-2024

Average

Share of GDP

Aggregate results

School district funding is largely non-local •

Nearly 80% of total funding over all county districts come from out of county

Total District Funding by Source 100% 90%

11.4%

9.5%

66.7%

67.8%

20.5%

21.7%

22.5%

2022

2023

2024

14.9%

80%

•

To a large extent, one could claim that a good portion of these flows are “new dollars”, with economic impact – Depends on county’s balance of “tax exports” to benefit imports – Our hunch: balance strongly favors Spokane as a “net importer” of benefits

70% 60% 50%

64.2%

40% 30% 20% 10%

0%

Local

State

Federal

County educational profile

Population with high school degree or less •

2024 (shares) – – –

County: 28% WA: 29% U.S.: 36%

•

Little short-term trend for county

•

Spokane County shows much lower shares than in U.S. and about the same as in WA

County educational profile

Population with some college or an associates degree •

2024 – – –

County: 37% WA: 30% U.S.: 27%

•

Trend in the county is declining (but from a high perch)

•

County shows much higher shares than in the U.S. or WA

•

“Some college” the larger of the two categories

County educational profile

Population with a bachelor’s degree or higher •

2024 – – –

County: 35% WA: 41% U.S.: 37%

•

Modestly upward growth in the county – from both types of

•

Still, relative to benchmarks, a lower total share

Returns to post-secondary education

Educational attainment & median household income (MHI) – a clear, positive relationship •

Statistics cover 2024 data for the 100 largest metro areas in the U.S. – –

•

Spokane MSA (Spokane & Stevens County) rank 97th Used shares of adult population educational attainment & MHI

Asks the question: to what degree do these 2 measures move together? (values between -1 and 1)

Correlation Coefficient Between MHI & Educational Attainment 1.0 0.763

0.8 0.6 0.4

0.2 0.0 -0.2

-0.4

•

Clear that MHI “moves” most with a share of the population with a bachelors+; it is high & positive –

Contrast to statistic for HS or less

-0.391 -0.6

-0.520

-0.8 -1.0

HS or Less

Some College or AA Higher

Bachelor’s or

Returns to post-secondary education/training

Recent analysis from the Bureau of Labor Statistics • Data from the BLS show that higher education provides both higher earnings and increased job security, relative to a HS diploma.

• Using a likelihood ratio, workers with some college (no degree) are 10% less likely to be unemployed; workers with a bachelor’s degree are 40% less likely to be unemployed.

• Moving from some college to a 4-yr degree lowers your risk of unemployment by 34%.

Returns to post-secondary education/training

Recent analysis from University of Georgetown • Analysis from the Georgetown Center on Education & the Workforce shows the lifetime private net earnings gain over a HS diploma (after considering costs of attaining degrees).

• Net earnings increase with greater schooling: While an associate’s degree yields, on average, an additional $250,000 in lifetime earnings, a professional degree provides, on average, $1.42M.

Returns to post-secondary education/training

Recent analysis from Georgetown University • This graph is like the previous slide but shows the path of lifetime earnings profiles by degree type.

• Because of the costs of post-secondary education/training, returns to post-secondary education do not exceed those from a high school diploma until around age 34 for most workers.

• Underscores the virtue of patience.

Returns to post-secondary education/training

Recent analysis from the College Board • Using data from various federal agencies, the College Board reports that since the 1990s, the rate of return for a college degree, on average, is around 12% annually – well above typical stock market yields.

• But the rate of return on college has remained relatively flat over the past 30 years.

Returns to post-secondary education/training

Recent analysis by Federal Reserve economists Using data from IPUMS (Census), the Federal Reserve Bank of St. Louis calculated annual rates of return on a college education by gender and race in 2023.

• The highest return was experienced by Asian Men with an annual rate of return of nearly 36%.

• The lowest annual rate of return was experienced by Black Women (13.5%).

• All returns exceed typical stock market annual returns.

Returns to post-secondary education/training

Recent analysis by Federal Reserve economists According to a study by the Federal Reserve Bank of Cleveland, one additional year of any post-secondary schooling provides the following returns (on average): • A 6.36% increase in worker productivity. For a four-year, undergraduate degree, this would represent an increase of over 25% in worker productivity compared to high school graduate.

• A 2.38% increase in worker productivity due to using post-secondary education as a signal for worker quality. For a typical 4-year undergrad degree, this would increase worker productivity by nearly 10%.

Returns to post-secondary education/training

Recent analysis by the NY Federal Reserve Bank that considers opportunity costs • The total cost of college includes not only direct costs (tuition, books, room & board), but also the opportunity costs (foregone earnings while in school.)

• The direct costs of college have fallen off since 2018 due to increased availability of aid, but opportunity costs continue to rise, making the total cost of college steadily increase.

Returns to post-secondary education/training

But rising college wage premium largely offsets rising opportunity costs • College graduates earn a substantial wage premium in the labor market compared to those with only a high school diploma.

• In 2025, the college wage premium for the median workers was over $32,000 or 68% -- near its all-time high.

• Real wages for college graduates have been rising around 7% compared to 5% for high school graduates, over the past decade.

Returns to post-secondary education/training

But the major matters While the ROI for college is, on average, positive and above other investments, choice of college major matters!

• STEM majors like engineering, math and computers provide higher rates of return.

• Fine arts, liberal arts, leisure & hospitality and education provide relatively lower rates of return.

•

WA may be different for education majors

Final thoughts

• The economic footprint of the county’s K-12 districts places it among the 10 largest sectors here, whether by headcount, earnings or expenditures – A good portion of districts’ revenues are not local -> using “new” dollars

• The county has a very large share of the adult population with an educational profile showing “some college” & a growing share showing a bachelors or higher.

• The evidence is clear: a strong financial return to most postsecondary education, depending on the degree/training.

• Without a high school diploma, these returns won’t be realized.

More Data Sources: The Returns to Post-Secondary Education • • • • • • • • •

Abel, J.R. & Deitz, R. (2025). Is College Still Worth It? Liberty Street Economics, Federal Reserve Bank of New York. https://libertystreeteconomics.newyorkfed.org/2025/04/is-college-still-worth-it/ Bureau of Labor Statistics. (2025). Education pays. U. S. Bureau of Labor Statistics. https://www.bls.gov/emp/chart-unemployment-earnings-education.htm Fry, R., Braga, D. & Parker, K. (2024). Is College Worth It? Pew Research Center. https://www.pewresearch.org/social-trends/2024/05/23/is-college-worth-it-2/ Hanson, M. (2024). College Degree Return on Investment. Education Data Initiative. https://educationdata.org/college-degree-roi Kaymak, B. (2025) Quantifying the Signaling Role of Education. Working Paper No. 25-02. Federal Reserve Bank of Cleveland. https://doi.org/10.26509/frbc-wp-202502 Ma, J. & Pender, M. (2023). Education Pays 2023: The Benefits of Higher Education for Individuals & Society. Trends in Higher Education Series, CollegeBoard. education-pays-2023.pdf Mejia, M.C., Perez, C.A., Hsieh, V. & Johnson, H. (2025). Is College Worth It? Public Policy Institute of California. https://www.ppic.org/publication/is-college-worth-it/ Morris, C., Cheah, B. & Strohl, J. (2025). The Major Payoff: Evaluating Earnings and Employment Outcomes Across Bachelor’s Degrees. Georgetown University Center on Education & the Workforce. https://cew.georgetown.edu/wp-content/uploads/cew-the_major_payoff.pdf Rodgers, W.M. & Kassens, A.L. (2025). Young Adults and the Softening U.S. Labor Market: A Warning Sign?

Federal Reserve Bank of St. Louis. https://www.stlouisfed.org/on-the-economy/2025/dec/young-adultssoftening-us-labor-market-warningsign?utm_source=Federal+Reserve+Bank+of+St.+Louis+Publications&utm_campaign=47c8a55f39BlogAlert&utm_medium=email&utm_term=0_c572dedae2-47c8a55f39-57483485

Thank you!

Institute for Public Policy & Economic Analysis D. Patrick Jones, Ph.D., executive director Kelley Cullen, Ph.D., research lead Malina Weigel, student (Economics) dpjones@ewu.edu