How to Understand (and measure) the Impact of Investments in Education?
Education has evolved drastically over the past couple of decades around the world.
The number of children enrolled in schools is one proof of that statement, but many other aspects tend to be overlooked when dealing with the matter. Enough progress is far from being achieved with inclusive and equitable education is a remote reality. Additionally, quality education is also something accessible to very few people worldwide. The situation in Brazil, where we can get a more feasible idea, is a great representation of how developing nations struggle to provide a descent education system for its citizens to acquire all necessary tools they require. 51,2% of Brazilians (108,9 million people) have not completed high school and are 25 years old or more. Even inside Brazil we have very big discrepancies about illiteracy data. The northeast region has, on average, 13,3% of its population being illiterate, while the South region sums up only 3,3% of illiterates.
Improvements are definitely necessary and urgent, but how can it be done? The benefits of education are clear. Improvements in education stimulate macroeconomic growth, increase people’s lifetime earnings, and are associated with better health and broader social outcomes. Yet, not enough people are able to take advantage of those benefits. Access to quality education is still largely determined by socioeconomic status and location. Even after several years of schooling, millions of people lack basic literacy and numeracy skills and are often not proficient to use excel in a 21st century workplace. Government officials will have to move past the overdue debate about public vs private education. Instead, they should analyze data regarding which combination of both is the best strategy for their environment. Such development will require smarter strategies, with multiple perspectives being taken into account. Ministers should be worried on “How do I ensure every child and adult in my country gets the skills they need to thrive in the 21st century?” Maximizing impact is the key, but how can we determine the impact of investments in Education? And what areas and stakeholders should be taken into consideration?
Learner refers to impact that directly affects the person (learning, life outcomes, accessibility and wellbeing).
System refers to impacts that accrue to the wider education eco-system. Access and affordability are both learner and system impacts. On an learner level, it relates to whether someone will be able to access this institution; on a system level we focus more on whether this specific form of education is in addition to government provision and at what price point.
The education sector has a long tradition of thinking through social impact. Education is a public good and providers largely operate in a regulated environment. Therefore, reputable education providers need to think deeply about their social impact. At the same time, investors, especially in education, are increasingly concerned with measuring and increasing the impact of their investments. The figure above demonstrates a framework proposed by the CDC Group, which seeks the proper evaluation of impact in its various aspects of life and development. More than that, this framework creates a tool for investors and contributors of the sector to collect data and precisely analyze the outcomes of their investment, both in the system and in the individual. On both sides, there are multiple layers getting influenced by one’s decision to foster their knowledge.
On the learner’s side, outcomes such as knowledge, motor skills, logical reasoning, and problem solving are learning outcomes. Life outcomes of a student include monetary outcomes, non-monetary outcomes, happiness and confidence. If we have established that an institution or product has a positive impact on learning and life outcomes, to establish the extent of this impact we need to understand whether the students would otherwise have had access to that level or quality of education, and at what scale. Wellbeing has to go hand-in-hand with all the others, as it is a pre-requisite to achieve any impact goal.
On the other hand, the system benefits from education in many areas. Capacity and equity are fundamental aspects for a provider to have a positive impact on the overall education system, assessed in terms of how far its services align with the needs of the local population and government. On accountability and transparency, the focus is on accountability at the system level. The key here is to look at the relationship with national governments that are responsible for the education system, but also the institutions’ interaction with other actors in the education system. At last, economy and society benefit from quality education and skills providers are essential in addressing the shortage of skilled workers. The provision of job- related training and whether the skills taught correspond to the needs of the economy and businesses is paramount when optimizing for the positive impact of education.
Education is the most important asset one can have access to. However, proper access to good education is very rare around the globe. Inequality, socioeconomic differences, governmental problems, political ideologies, and lack of investment are some of the many difficulties encountered by those who seek to improve the system. On the other hand, it is always necessary for an investor to measure the outcomes of their investment, which is something not lef behind in education investments. The social impact can be measured through a framework presented by the CDC Group, which establishes well-defined guidelines to assess and measure impact based on investment in Education. Ultimately, the benefits from access to quality education go far beyond the individual or societal level, extending to the environment and relevant stakeholders.
