The damage is growing: $31 trillion in predicted economic losses from learning disruptions

Perhaps another headline about a drop in academic test scores doesn’t faze you anymore, but the projected impact lost learning will have on students over their lifetimes is nothing to dismiss, and it’s growing.

A new research paper by Stanford University economist Eric Hanushek and economist Bradley Strauss gives us a global perspective on learning loss in the United States and its subsequent economic consequences that could total $31 trillion.

(Hanushek previously estimated that academic setbacks during COVID-19 could cost each impacted student $70,000 over the course of their careers, or roughly $28 trillion.)

His latest research with Strauss builds on his prior predictions by analyzing math performance of U.S. students on two standardized tests — the Programme for International Student Assessment (PISA) administered to 15 year olds worldwide, and the National Assessment of Educational Progress (NAEP) administered to fourth and eighth graders in the United States.

Based on the available research on lifetime earnings associated with more skills, the average student in school during the pandemic will lose 5 to 6 percent of lifetime earnings. Because a lower-skilled workforce leads to lower economic growth, the nation will lose some $31 trillion (in present value terms) during the twenty-first century. This aggregate economic loss is higher than the US GDP for one year and dwarfs the total economic losses from either the slowdown of the economy during the pandemic or from the 2008 recession.

Student performance in the highest-achieving state, Massachusetts, came in 16th in the world distribution, calculate Hanushek and Strauss. “…[E]ven the best-performing American states did not do well when compared to what is possible. The large number of countries where the average student performed better than the average student in the best states raises concerns about the economic future of our country.”

You can see Minnesota’s placement according to the authors’ calculations in the chart below.

Math achievement in 2022 for U.S. states and for countries above the international median

Source: Hanushek and Strauss calculations from OECD (2023a) and NAEP (2024).

Based on average learning loss, Minnesota students can expect over a 7 percent loss in future income — putting the state 8th highest in expected loss in lifetime income from interrupted learning.

Average individual economic losses by state

Source: Eric Hanushek, The Economic Cost of the Pandemic: State by State, Stanford, CA: Hoover Institution, 2023.

“History suggests that these losses are likely to be permanent unless the schools become better than they were before the pandemic,” write Hanushek and Strauss. (A hard ask given the declining academic performance that existed pre-COVID.)

So, what is needed? More than lengthening school days, tutoring, and summer school, the authors state, which “have not on average been very successful in addressing the pandemic losses.” Instead, Hanushek and Strauss recommend giving our most effective teachers incentives to take on a few more kids. “Of course, this would require restructuring school operations and as such will likely meet with considerable opposition.”

Unfortunately, any ability to deal with the learning losses is largely limited to the time that the affected students are enrolled in K−12 schools. More than seventeen million students have already completed their K−12 schooling without having been substantially brought up to the learning levels of the school seen before the pandemic. Thus, for most of this segment of the population, the learning losses are likely to be permanent, and the implications for future earnings losses are locked in.