If you’re not investing in your local public school district, are you really investing in your community?
Good communities don’t emerge by accident, they’re built on foundations that support long-term prosperity, stability, and civic engagement. Research consistently demonstrates that strong public schools serve as the cornerstone of thriving communities, creating ripple effects that extend far beyond classroom walls.
Public education institutions function as economic engines, community hubs, and talent magnets. School districts often represent the largest employers in many regions, while education quality directly influences property values and local tax revenues.
Furthermore, communities with exceptional schools attract businesses seeking skilled workforces, creating a virtuous cycle of investment and opportunity.
The relationship between educational excellence and community vitality is undeniable and multifaceted. This research-based analysis examines how public schools shape economic stability, real estate markets, civic engagement, and workforce development.
All essential components of vibrant communities that prosper over generations rather than merely surviving in the present. It’s essential that communities analyze past community data in order to make accurate investments in the community.
The Economic Backbone: How Schools Drive Local Economies
Public schools contribute to local economies in ways that extend far beyond their educational mission. When examining the economic impact of educational institutions, the data reveals they function as powerful economic engines that sustain communities across America, particularly in rural areas where other industries have declined.
Schools as major employers
Educational institutions typically rank among the largest employers in communities of all sizes. In rural areas especially, schools often serve as the primary employer after decades of business consolidation and healthcare facility closures [1]. The employment impact is substantial as a single 1A high school in Kansas (with just 100-175 students) can employ between 50-70 adult staff members across diverse roles [2]. These positions include teachers, administrators, paraprofessionals, maintenance staff, bus drivers, librarians, counselors, office professionals, and food service workers.
Salary ranges within school districts create economic stability across income brackets. From classified personnel earning around $25,000 annually to administrators making $90,000-$100,000, schools provide employment opportunities at various compensation levels [2]. This economic impact becomes even more pronounced in remote communities, where alternative employment options are limited.
Statewide analyzes demonstrate this employment effect. In New York State alone, school districts directly employ approximately 376,665 people who earn a combined $32.2 billion in income [3]. The overall economic footprint extends even further, with school districts generating a total of 672,310 jobs throughout the state [3].
Local spending by school staff and vendors
The economic influence of schools multiplies through local spending patterns. A typical 1A school district might have annual expenditures of $1.6 million, with substantial portions allocated to local vendors [2]. Schools regularly purchase transportation parts, maintenance services, banking services, and food supplies from community businesses.
Additionally, employee spending creates secondary economic benefits. School staff members buy groceries, fuel, insurance, and housing in their communities, circulating salary dollars throughout the local economy. In farming communities, the steady income and insurance benefits provided by school employment often sustain family agricultural operations [2].
The Ardsley school district in New York illustrates this economic relationship clearly. With direct employment of 392 people, the district’s operations generate approximately 323 additional spillover jobs in the Hudson Valley region through procurement and employee spending [3]. This creates a total economic impact of 715 jobs and $57.4 million in income [3].
Multiplier effect of school district budgets
Education spending delivers remarkable economic returns that exceed initial investments. Research shows that for every dollar invested in education, communities experience multiplier effects that amplify economic activity. According to studies examining the Federal Pell Grant Program, an increase in educational grants equal to 1 percent of a city’s income raises local income by 2.4 percent over the subsequent two years [4].
This multiplier effect outperforms other forms of government spending. Education multipliers exceed those of military spending (which averages 1.5) [4]. Other research estimates even higher returns, with educational spending generating multipliers of 2.8, meaning each dollar spent creates more than twice as much economic activity [5].
The economic benefits materialize through multiple channels. First, educational investments directly increase personal income. Second, when funding targets lower-income students (like title 1), the economic impact intensifies because these recipients typically have higher marginal propensities to consume [5]. Third, educational spending often leverages complementary financing sources, creating additional economic activity.
These economic impacts generate substantial tax revenue. In New York’s Hudson Valley region alone, school-related income produces approximately $404 million in state income tax and $153.8 million in sales tax [3]. Statewide, the economic activity from school districts generates $2.7 billion in income tax and $1.2 billion in sales tax [3].
Consequently, communities that invest in quality education create a virtuous economic cycle that strengthens local businesses, generates employment, and maintains essential public services through expanded tax bases.
Public Schools and Real Estate Stability
The stability of real estate markets across America hinges significantly on the quality of local public schools. Strong educational institutions create ripple effects throughout communities, stabilizing property values and establishing neighborhoods as desirable places to live for generations.
Why families prioritize school districts when buying homes
School quality consistently ranks among the top priorities for homebuyers, especially those with children. According to the National Association of Realtors, 53% of buyers with children under 18 cited school district quality as an important factor when purchasing a home [6]. For buyers aged 33-42 who are more likely to have young children, and this percentage jumps significantly, with 30% listing school quality as a major factor influencing their neighborhood choice [7].
Notably, these homebuyers are willing to make substantial compromises to secure homes in desirable districts. A 2016 Realtor.com survey revealed that 78% of buyers for whom schools were a priority had to make compromises when purchasing a house [8]. In fact, approximately one in five homebuyers expressed willingness to exceed their budget by 6-10% specifically to live in a sought-after school district [9].
Even individuals without children recognize the value proposition. As one expert explains, “Even for buyers without children, the quality of nearby schools is a crucial consideration due to its impact on resale value” [7]. This universal appeal creates sustained demand for properties in strong school districts.
Impact of school ratings on property values
The correlation between school performance and home values is remarkably consistent across research studies. When Florida implemented its school grading system, homes near A-rated schools immediately increased in value by approximately $10,000 compared to similar homes near B-rated schools [10]. As this rating system continued over several years, the gap widened dramatically—home values now vary by $50,000 to $300,000 based solely on school ratings [10].
Specifically, the Brookings Institution found an average difference of $205,000 in home prices between houses near high-performing versus low-performing schools across the 100 largest metro areas [10]. Homes around high-performing schools also tended to be larger, with 1.5 more rooms than properties near lower-performing institutions [10].
The financial impact extends beyond mere comparisons. For every dollar spent on public schools in a community, home values increased by $20 [10]. Similarly, a 5% improvement in test scores can raise suburban home prices by 2.5% [8]. Another study found that a 1% increase in spending on teacher salaries increased home values by 2% [11].
How good schools protect home values during downturns
Perhaps most compelling is how good schools function as economic stabilizers during market volatility. A study published by Bigger Pockets found that schools with ratings of four or five stars (on a five-star scale) were “almost completely insulated from declining home values during a recession,” whereas homes near schools with one to three stars experienced significant losses [12].
This resilience provides homeowners with crucial protection during economic uncertainties. According to realtor Ken Corsini, who studied real estate prices in Atlanta before and during the housing crisis of the late 2000s, homes in good school districts did not experience as much devaluation as those in average or poor districts [8].
In essence, homes in desirable school districts not only command premium prices but also sell faster, approximately eight days quicker than homes in average districts [8]. They also receive 26% more online views [8], creating a persistent competitive advantage for homeowners in these communities.
This stability reinforces why good communities invariably start with strong public schools as they provide the foundation for sustainable real estate markets that weather economic storms while maintaining their appeal to new generations of homebuyers.
Community Engagement Starts in the Classroom
Beyond economic engines and property value anchors, public schools serve as vital centers for community connection and civic growth. Research spanning 50 years demonstrates the remarkable benefits when schools actively partner with families and community members to create hubs of engagement [13].
Schools as hubs for civic participation
Schools function as anchor institutions, reliable places where stable relationships form with nearby residents across diverse backgrounds [14]. In countless communities, particularly rural ones, schools provide physical spaces where citizens discuss local issues, vote, and participate in democratic processes. These institutions serve as laboratories where young people develop civic skills through authentic experiences.
Studies show that when schools engage in participatory decision-making processes, they cultivate broad perspectives that inform better governance [15]. For instance, participatory budgeting programs in schools help students develop civic knowledge while giving them genuine voice in resource allocation [16]. This practical experience with democratic processes builds lifelong civic competencies.
Volunteerism and local pride
School-based volunteering creates intergenerational connections that strengthen community fabric. Programs like the parent mentor initiative in Chicago’s Logan Square neighborhood train parents (primarily immigrants) as classroom assistants while providing leadership development, creating a welcoming community, and building skills that extend beyond school walls [17].
Service learning initiatives integrated into curricula allow students to apply classroom knowledge to real-world contexts. These experiences cultivate empathy, civic responsibility, and community pride [18]. Moreover, schools that celebrate local diversity through multicultural events and heritage celebrations foster inclusivity while honoring the unique character of their communities.
How schools foster a sense of belonging
Connection happens when a school community collectively feels supported, respected, and accepted [19]. Research indicates that belonging is biologically embedded into our DNA, affecting physical health (sleep quality, cardiovascular functioning, immunity) and mental wellness, while reducing antisocial behavior and depression [20].
When schools prioritize belonging through inclusive policies and practices, students experience improved attendance and engagement [1]. Schools that reflect their communities’ diversity in staff composition, especially in leadership positions, help students see themselves represented and valued [1].
Ultimately, good communities recognize that schools are more than places to learn as they are pillars of culture and social development [14]. By creating environments where students, families, and community members collaborate with school leaders, communities build mutual trust that extends far beyond graduation day [15]. This collaborative approach creates resilient social networks essential for community vitality and civic health.
Attracting Talent and Building the Future Workforce
Communities with exceptional educational systems possess a distinct advantage in the competition for professional talent and future economic growth. As businesses increasingly prioritize locations with skilled workforces, the relationship between school quality and economic prosperity becomes ever more crucial.
Why professionals choose communities with strong schools
Professional families actively seek communities with strong public schools regardless of their current family status. Businesses understand this connection as they strategically locate in areas with quality education systems to attract talented employees [21]. These communities typically offer additional benefits including lower crime rates and higher overall quality of life, creating comprehensive appeal for top talent [21].
The economic impact extends beyond simple recruitment. Areas with excellent schools naturally attract high-quality educators and administrators, creating a positive spillover effect throughout the local economy [22]. This talent influx generates increased job opportunities across sectors, establishing a foundation for sustained economic growth [22]. Therefore, investing in education becomes both a social and economic imperative for forward-thinking communities.
The link between school quality and workforce readiness
Research consistently demonstrates the connection between educational attainment and economic success. In 2022, bachelor’s degree holders earned median salaries of $66,600, 59% higher than those with only high school diplomas at $41,800 [23]. This gap widens during economic downturns, with college graduates showing greater resilience in challenging times [23].
Nevertheless, America’s education system faces significant gaps in preparing all students for careers, particularly affecting Black, Latinx, and Indigenous communities [24]. Addressing these inequities requires integrating K-12 education with higher education and workforce development to build streamlined pathways to good jobs [24].
Early college and vocational programs as economic tools
Early college programs have emerged as powerful economic tools for communities. These initiatives allow high school students to earn college credits or associate degrees at minimal cost, particularly benefiting underrepresented students [23]. The financial benefits are substantial as early college enrollment results in lifetime benefits of approximately $58,000 per student [3].
Similarly, vocational education programs directly align with local workforce needs. In Texas, community colleges respond to changing economic conditions by offering certificates and degrees that lead directly to employment in high-demand fields [25]. These institutions frequently collaborate with regional employers to identify market trends and fill specific workforce niches [25].
Ultimately, communities that invest in comprehensive education pathways from strong K-12 foundations through early college and vocational options create sustainable economic advantages through a better-prepared, more adaptable workforce.
The Cost of Neglect: What Happens When Schools Decline
Neglecting public schools creates a downward spiral that’s difficult to reverse once set in motion. When educational institutions decline, entire communities feel the effects across economic, social, and civic dimensions often with compounding negative consequences that persist for generations.
Business flight and rising unemployment
As school quality deteriorates, businesses begin to reconsider their presence in the community. Companies struggle to attract and retain talented employees when local schools fail to provide quality education. This talent shortage forces businesses to relocate to areas with stronger educational systems, triggering a domino effect of economic contraction.
Research shows that school closures and consolidations are often markers of educational decline and devastate local economies. Small businesses that depend on school-related spending experience immediate revenue drops. In districts where flight schools closed, local economies lost crucial revenue streams as operational budgets evaporated [26]. Eventually, these closures create broader unemployment issues as both direct school positions and related jobs disappear.
Falling property values and tax base erosion
Declining schools directly impact real estate markets, initiating a troubling cycle of disinvestment. Studies indicate communities with underfunded schools experience significant drops in property values [27]. These declining values subsequently reduce local tax revenues, further starving schools of resources.
The effect becomes self-reinforcing as property values fall, tax collection diminishes, forcing additional school budget cuts that accelerate educational decline [28]. This creates what researchers call “tax base erosion,” where communities gradually lose their capacity to fund essential services. Communities with struggling schools find their tax bases can shrink by millions of dollars annually [27].
The long road to community recovery
Once educational decline takes hold, recovery proves challenging and expensive. Studies examining school revitalization efforts reveal that the cost of rebuilding educational systems far exceeds what preventive investment would have required. In Washington, D.C., school closures initially projected to cost $9.7 million ultimately cost nearly $40 million after accounting for building demolition, student transportation, and lost property value [29].
Given these points, community rebuilding becomes a lengthy process requiring sustained commitment. Chicago residents, for instance, continue struggling years after mass school closures, with numerous vacant buildings becoming targets for crime and vandalism [29]. Vacant school buildings create additional community hazards, transforming from “community anchors into actual dangerous spaces” [29].
Ultimately, the path to recovery demands substantial reinvestment alongside strategies that address both educational quality and community development simultaneously a complex challenge requiring years of dedicated effort.
Conclusion
The research and data overwhelmingly demonstrates that thriving communities depend on robust public school systems. Strong educational institutions create positive ripple effects throughout society, generating economic stability, protecting property values, fostering civic engagement, and developing future workforces.
Schools function as economic powerhouses, employing significant portions of local populations while creating multiplier effects that benefit entire regions. Their spending circulates through communities, generating additional jobs and tax revenue that far exceeds initial investments. Property markets similarly benefit, as homes near quality schools maintain higher values and show remarkable resilience during economic downturns.
Schools serve as vital centers for community connection. They provide spaces where diverse community members come together, fostering volunteerism, civic participation, and a shared sense of belonging. This social foundation attracts talented professionals seeking both career opportunities and quality education for their families.
Communities neglecting their educational systems face serious consequences. Business flight, unemployment, eroding tax bases, and plummeting property values create downward spirals that prove exceedingly difficult to reverse.
Therefore, investing in public education represents both a moral imperative and practical necessity for community prosperity. Communities must recognize schools not merely as expenses but rather as investments yielding substantial returns across multiple dimensions. Though building excellent educational systems requires significant resources and commitment, the cost of neglect ultimately proves far greater.
Quality public education forms the bedrock upon which good communities build lasting prosperity, stability, and civic health. Communities prioritizing their schools today establish foundations for generational success tomorrow.
Can charter school schools replace public schools?
References
[1] – http://chartered.college/news-blogs/the-power-of-community-engagement-in-our-schools/
[2] – https://www.farmprogress.com/commentary/public-schools-are-economic-drivers-for-our-rural-communities
[3] – https://direct.mit.edu/edfp/article/16/4/659/97119/The-Costs-and-Benefits-of-Early-College-High
[4] – https://www.federalreserve.gov/econres/feds/the-multiplier-effect-of-education-expenditure.htm
[5] – http://www.maartenderidder.com/uploads/6/2/2/3/6223410/educationmultipliers.pdf
[6] – https://www.nar.realtor/schools-the-homebuying-decision
[7] – https://erawilderrealty.com/2024/02/26/how-local-schools-impact-property-values-a-comprehensive-analysis
[8] – https://www.hsh.com/homebuyer/should-you-spend-more-for-home-with-better-schools.html
[9] – https://pacresmortgage.com/knowledge-center/news-insights/school-districts
[10] – https://www.publicschoolreview.com/blog/what-is-the-connection-between-home-values-and-school-performance
[11] – https://www.premiermtg.com/5-things-homebuyers-should-know-about-school-districts/
[12] – https://raleighrealty.com/blog/how-schools-impact-home-values
[13] – https://www.gse.harvard.edu/ideas/usable-knowledge/23/03/case-strong-family-and-community-engagement-schools
[14] – https://www.planetizen.com/blogs/131142-role-schools-fostering-vibrant-and-inclusive-communities
[15] – https://www.greatschoolspartnership.org/resources/equitable-community-engagement/the-case-for-community-engagement/
[16] – https://circle.tufts.edu/latest-research/participatory-budgeting-schools-helps-build-student-voice-and-civic-skills
[17] – https://thoughtexchange.com/blog/community-involvement-in-schools/
[18] – https://www.parentsquare.com/blog/community-involvement-in-schools-reaching-beyond-students-staff-families/
[19] – https://www.newleaders.org/blog/belonging-in-schools-why-it-matters-and-how-to-build-it
[20] – https://www.edutopia.org/article/importance-belonging-in-schools/
[21] – https://www.dominionpost.com/2024/04/28/good-quality-schools-are-important-to-the-success-of-the-community/
[22] – https://comomag.com/2023/07/07/great-schools-mean-great-communities/
[23] – https://www.air.org/sites/default/files/2024-07/IES-EC-Final-Report.pdf
[24] – https://www.americanprogress.org/article/preparing-american-students-workforce-future/
[25] – https://comptroller.texas.gov/economy/fiscal-notes/archive/2020/july/community-colleges.php
[26] – https://jdasolutions.aero/blog/flight-school-economics/
[27] – https://parents4publicschools.org/when-schools-are-underfunded-children-suffer/
[28] – https://www.cbcfinc.org/capstones/education/exploring-the-nexus-of-property-taxes-housing-disparities-and-educational-access-for-black-and-brown-youth-in-major-u-s-cities/
[29] – https://populardemocracy.org/news-article/news-and-publications-devastating-impact-school-closures-students-and-communities/