SIIA - Panel comments by Richard Sims

At the recent SIIA EdTech Business Forum, Richard Sims, Chief Economist of the National Education Association, stated his views on school funding issues over the next several years. His belief is that while federal funds for education may remain steady for the next few years (barring budget deals or changes in administration), state and local funding, which is about 90% of K12 funding, is under siege, and will not recover to pre-recession levels until 2017. With real estate taxes starting to nosedive, we can expect a 10% decrease in total education funding over the next two years. The good news is that there is some job growth, but a) it is slow job growth and not likely to reach the number of 2007 jobs until past 2017, b) half of the job growth is in the lowest paying jobs (while half is in the highest skilled highest paying jobs, and virtually no growth in the middle pay jobs), and c) states are focusing on cutting state income taxes, which is the revenue source quickest to rebound based on job growth.