In Ireland, free education has more than proved its worth

This year marks the 50th anniversary of the introduction of free education, one of the most important policy changes since the foundation of the State.

For the generation born around 1950, the last cohort to lose out on free education, many never made it beyond primary school. Most primary schools had a seventh class for those remaining just until their 14th birthday. Half of all children left before senior cycle and less than 20 per cent progressed to third level, many of them by means of a night degree.

Ireland was one of the last countries in northern European to wake up to the importance of investing in the education of its youth. For those born in Europe in the early 1930s, more than half completed their high school education in the UK, Germany and Estonia. By contrast, in Ireland, Romania, Spain, Portugal and Greece, more than 70 per cent of children left school before this milestone.

By the time free education was introduced in 1967, Ireland still ranked at the bottom of the European scale, lagging behind top performers – as well as the United States.

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Progression doubled

The advent of free education transformed the rate of participation in second level, along with rising numbers completing the senior cycle. The outcome was that progression to the Leaving Cert virtually doubled over the next 30 years, from about 40 per cent to 80 per cent. The Republic joined the top of the class, along with some newcomers such as Poland, Finland and France.

As a Leaving Cert became almost universal, participation at third level also rose significantly. More than half of those born in the 1990s have gone on to college – among the highest progression rates in Europe.

There are wide societal benefits to investing in education, including significant economic gains. For years, Ireland’s tardiness had many adverse economic consequences. Lower levels of education depressed employment and earnings potential both at home and abroad, with often lifelong consequences. Ireland’s living standards were thus slow to catch up with the rest of Europe.

Combined with the dogged protectionism that marked public policy until 1960, Ireland continued to lag behind. It was only in the 1990s that the rising skills of an educated workforce, combined with an open economy and EU membership, enabled Irish living standards to catch up to our European neighbours. Wiser policies should have delivered this outcome decades earlier.

Earning rates

Successive studies have shown that employment rates and earnings are directly related to the highest level of education attained. Studies of the 1990s show that workers with a degree earned on average double what those with only primary education earned. This private benefit from investment in education also had a wider impact on the economy.

Education raises the productivity of individuals, and thus of the wider economy. The higher the level of education, the more likely people are to participate in the labour force, something that has been particularly important for women.

Finally, those with a good education are much less likely to spend long periods unemployed. After the recent economic crisis, unemployment has fallen reasonably rapidly, compared with the slow decline in unemployment in the early 1990s. This is because so many of those laid off in the late 1980s had poor levels of education, and found it harder to get jobs in the recovery period.

Postwar northern Europe generally saw a significant investment in education, which later delivered high growth rates in output per head in the 1960-80 period in countries such as Germany. As retirees with just basic education were replaced by those with second-level or college education, the skills composition of the workforce improved, helping to generate economic growth.

Improving attainment

For Ireland, because investment in education was delayed, the growth bonus it delivered occurred a generation later, in the 1990-2010 period. It is estimated that between a third and a half of Ireland’s economic growth over the period 1990-2010 arose from the improving educational attainment of the labour force.

In the late 1960s, just over 10 per cent of young people went on to third level. Today that is closer to 60 per cent. While the growth boost from the entry of younger well-educated workers, and the resulting improved educational composition of the workforce, may have peaked, it will still be a factor over the next decade and beyond. The likelihood is it will add about half a percentage point each year to the growth in productivity out to 2025.