COUNTRIES in Southeast Asia stand to lose billions of dollars in the near future unless urgent measures are taken to enroll millions of out-of-school children in the region, according to a report released on Friday by the United Nations Educational, Scientific and Cultural Organization (Unesco) Bangkok and Results for Development Institute (R4D).
“The Economic Cost of Out-of-School Children in Southeast Asia,” copublished by Unesco Bangkok and the Washington-based R4D, focuses on seven Southeast Asian countries: Cambodia, Indonesia, Lao PDR, the Philippines, Thailand, Timor-Leste and Vietnam.
The report estimates that if primary-school enrollment patterns do not change, the unskilled work force that emerges will cost countries anywhere from 0.1 percent of their gross domestic product, in the case of Vietnam, to as much as 4 percent of GDP, in Timor-Leste. These estimates are on forfeited earnings alone—they tripled on average when researchers factored in indirect, nonearnings costs associated with out-of-school children. In Timor-Leste, the projected costs outstrip the country’s average annual economic growth.
The report shows that enrolling out-of-school children in primary school is not only a moral imperative, it makes sound financial sense, with projected economic gains exceeding estimated increases in public spending in all countries, even those with relatively few out-of-school children, such as Vietnam.
Young people from the poorest households in the region are overwhelmingly overrepresented among out-of-school children as their families are unable to finance their schooling. “Universal primary enrollment would reduce inequality in the region, which is high ,particularly in the three largest economies we analyze [Indonesia, the Philippines and Thailand],” the report finds. “Thus, there are strong equity and efficiency arguments in favor of endowing out-of-school children with quality primary education.”
An estimated 7 million children are out of school in East Asia and the Pacific, according to the Unesco Institute for Statistics. “This new study makes the economic case for just how much countries stand to benefit from aggressively pushing ahead with measures to get them in school,” says Ichiro Miyazawa, Unesco Bangkok program specialist in literacy and lifelong learning.
“Asean countries have made tremendous strides toward universal primary education; however, this study shows that complacency would be extremely costly when it comes to the millions of out-of-school children remaining in this subregion,” Miyazawa said. “We hope that this report provides decision-makers in this region with a clear understanding of the significant economic benefits of educating out-of-school children in this region.”
The report uses labor-market data to estimate the total earnings that will be lost as a result of an uneducated work force if current primary school enrollment patterns do not change and also estimates the relationship between national education attainment and per capita income in East Asia.