Capitol Update
by Senator Howard Marklein
September 11, 2020


The Pending Cliff

As a CPA and a member of the Joint Finance Committee (JFC), I regularly collect and analyze data and examine forecasts to make decisions. As we craft the state budget and future policy, data and forecasts will be very helpful.
High school graduation projections are one example of an area where forecasts are readily available. High school graduation trends can be seen 10-15 years in advance by looking at kindergarten classes. We know how many children are in each grade level in our schools. We can fairly accurately predict how many students will graduate in the coming years.  This is useful information as we make decisions about K-12 education and our University system.
As the population of Wisconsin ages and parents have fewer children, enrollment in K-12 schools in Wisconsin is on the decline. In fact, in the 2018-2019 school year, there were approximately 5,000 fewer students starting kindergarten than were in 8th grade in Wisconsin public schools. Students who finished kindergarten in 2019 will be graduating high school in 2031.
We are fortunate to be able to project this kind of data into the future. Private sector businesses don’t really know what is coming in a week, much less 10-15 years down the road. They can make predictions based on trends and assumptions, but at the end of the day, these are educated guesses. The numbers we have for graduation estimates and class sizes are based on solid numbers.  
There are several groups that have done high school graduation projections for Wisconsin, including the Applied Population Laboratory (APL) at the University of Wisconsin – Madison (UW-Madison) and the Western Interstate Commission for Higher Education (WICHE).
The APL projection was released in December 2017 and has projections through 2026. The WICHE projection was released in December 2016 and has projections through 2032.
Both projections show an upward trajectory of high school graduates from 2020-2025. However, 2025 is the high water mark. The APL projects 67,639 graduates while the WICHE projects 66,778 graduates in 2025. After 2025, the projected high school graduation numbers decrease substantially. In fact, the WICHE projection shows a decrease of nearly 5,900 graduates from the high water mark in 2025 to the low point in 2031. This is a decrease of 8.72%. There is a graduation cliff coming.
This cliff is not a guess. It is based on the real number of children who completed kindergarten in 2019 and will graduate from high school in 2031. This cliff raises important questions for the state’s colleges and universities, especially the University of Wisconsin System (UW System), K-12 school districts, and businesses across the state.
For the UW System – Do we build additional capacity? What will be the impact on our 2-year campuses? UW-Madison policy states that a fixed number of students in the freshman class must be residents of Wisconsin. Will UW-Madison peel students away from other schools? What will be the impact on the other 4-year campuses in the UW System?
For K-12 Education – What will future funding look like as enrollment declines around the state? Will school districts need to build additional capacity? Will school district consolidation become necessary? How will school districts navigate an accelerating decrease in students?
For Businesses – A decreasing number of graduates means a decreasing number of potential employees. How will businesses recruit talent from outside of Wisconsin? Can businesses recruit employees to do remote work from across the state? Has the COVID-19 Pandemic helped or hurt the future workforce? How will businesses weigh the costs of recruitment and higher wages vs. the costs of innovation and automation?
The upcoming graduation cliff leaves a lot of unanswered questions. Policymakers, university leaders, school districts, and businesses need to keep all of these questions and more in-mind as future decisions are made.
These graduation numbers provide an interesting glimpse into the future and I will keep these projections and questions in mind as we craft future budgets.

As always, please do not hesitate to connect with me to provide input, ideas or to seek assistance.  Send an email to sen.marklein@legis.wisconsin.gov or call 608-266-0703.