Report confirms that for states, investing in education is key to prosperity

The best way for Oklahoma to grow its economy is by investing in a well-educated workforce, according to a new paper from the Economic Analysis and Research Network (EARN), a project of the Economic Policy Institute.

In “A Well-Educated Workforce is Key to State Prosperity,” Noah Berger, president of the Massachusetts Budget and Policy Center, and Peter Fisher, research director at the Iowa Policy Project, find that the educational attainment of state workforces is strongly linked with both productivity and median wages.


Overwhelmingly, high-wage states are states that have a well-educated workforce, while states with less-educated workforces see lower wages. In 2012, just 28.1 percent of Oklahoma’s workforce had attained a bachelor’s degree or higher, lower than 39 other states. That same year, Oklahoma’s median wage of $15.22/hour was lower than 35 other states. Nationally, in the 22 states with the least-educated workforces, median wages hover around $15 an hour (the only exceptions being Wyoming and Alaska), while in the three states where more than 40 percent of the population has a bachelor’s or more education, median wages are $19 to $20 an hour, nearly a third higher.

At the same time, the study shows that there is no significant link between a state’s tax rates and its wages.  Higher-tax states appear to have slightly higher median wages, but that correlation is not significant. Oklahomans earned relatively low wages despite having the 4th lowest combined state and local tax rates in the nation.

The report confirms what most Oklahoma economists and economic developers are already saying, namely that improving our education system will create more economic opportunity for Oklahomans and do more to strengthen Oklahoma’s overall economy than anything else. The authors note:

The connection between education and income is strong. A high school diploma, technical college certificate, or college degree not only increases one’s skills and productivity, but signals to employers that the individual is motivated and completes tasks. A more educated individual is more likely to participate in the job market, to have a job, to work more hours, and to be paid more, and less likely to be unemployed. But the benefits of education go beyond the economic returns. Higher levels of education also correspond to improved health and lower rates of mortality, and lower rates of crime.

Investing in education is also good for state budgets in the long run as highly educated workers have higher incomes and thus pay more in taxes and rely less on state assistance.

MedEarningsbyEducation-EPIThe paper identifies strategies for Oklahoma to boost educational attainment and grow the economy. These include working to slow the growth of college tuition, increasing financial aid, moving people without high school degrees through GED and associate degree programs, and investing in K-12 education to better prepare students for college.

Meanwhile, the paper argues that strategies involving cutting taxes to lure employers and capture private investments from other states are shortsighted, because they promote a race to the bottom which undermines states’ ability to invest in and attract an educated workforce.

The full report is available at


Former Executive Director David Blatt joined OK Policy in 2008 and served as its Executive Director from 2010 to 2019. He previously served as Director of Public Policy for Community Action Project of Tulsa County and as a budget analyst for the Oklahoma State Senate. He has a Ph.D. in political science from Cornell University and a B.A. from the University of Alberta. David has been selected as Political Scientist of the Year by the Oklahoma Political Science Association, Local Social Justice Champion by the Dan Allen Center for Social Justice, and Public Citizen of the Year by the National Association of Social Workers.

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