Peer Pressure Affects Teen Educational Decisions

Peer pressure.  Typically it is blamed for bad behavior.  It’s the reason teenagers do things that they really didn’t want to do: it wasn’t their idea - everybody was doing it!

But is peer pressure only an excuse for bad decisions?  There is study that suggests peer pressure effects important education decisions as well.

I am interested in this peer pressure study because it relates to how teens make decisions about education.  The opportunity for financial success is tied to the decisions students make about their education after high school.  The Harvard Graduate School of Education found that by 2018, 33 percent of the workforce will need at least a college degree and 66 percent need technical skills, credentials or an associate degree.  Only one percent will find a job with no training required.

Leonardo Burszryn of UCLA and Robert Jensen of Wharton wanted to find out what factors influenced the decisions of 11th grade students to accept or decline the opportunity to sign up for free SAT prep courses.  You might think that it is parents or teachers who most influence these decisions or the careers these students are considering.

Instead, the researchers discovered that the controlling factor was whether or not their decisions were going to be made public to their peers.

Forms to sign-up for the free courses were provided to students in honor and non-honor classes.  The forms randomly included different instructions.  Some indicated that the students’ choices would remain confidential.  Some forms, however, noted their choices would be made known to other students in the class.

There was no other consultation available.  Students were required to fill out the form and return them during the same class period. 

In the non-honors classes 72 percent of students signed up for the extra study when they were told their decisions would remain confidential.  That dropped to 61 percent when students were told that their classmates would learn about their decisions - an 11 percent drop because their peers would discover they wanted SAT study assistance.

As one might expect, students in honors classes were more likely to sign up for the classes.  There was little difference based on whether the decision was public or private - 93 percent versus 92 percent.

But when the same students who had been offered the study in their honors class were offered the same extra study in their non-honor class, their decisions changed.  When they were in their honors classes there was a higher rate of signing up when they knew their colleagues would learn their choices - 25 percent more signed up.

When they returned to their non-honors classes, however, their decisions about signing up for the SAT assistance changed.   Students who were told their decision were confidential signed up 79 percent of the time. That dropped to 54 percent when told their decisions would be made public to their non-honor classmates.  Same students, same question, but different answers depending on what they perceived as the norm for their peer group at the time.

This is just one study but it speaks volumes about how important positive reinforcement is to teenagers when their make decisions about their education.  And it reminds us that the positive reinforcement from parents and teachers alone - while necessary - isn’t always sufficient. 

Celebrations take note of Asian-Pacific contributions

May is Asian-Pacific American Heritage Month, a federally proclaimed celebration of the contributions of immigrants and American-born residents from Asia and the Pacific Islands and the important role they play in our history, culture and economy.

The idea for an Asian-Pacific American Heritage recognition originated in 1977 with a bill co-sponsored by a bi-costal partnership - Rep. Frank Horton from New York and Rep. Norman Mineta from California.  In 1992 the designation was extended to include the entire month.

May is significant for several reasons.  First, May 10, 1869 is the date a fourteen year old fisherman, Manjiro Nakanohama, arrived in New Bedford, Massachusetts on a whaling boat.  The trip was not intentional.  Manjiro’s fishing boat was caught in a violent storm off of Japan’s coast. 

The crew including Manjiro was rescued from a deserted island 300 miles off Japan’s coast by a whaling boat captained by William Whitfield.   Captain Whitfield adopted the young fisherman and invited him along on their journey.  Today, Manjiro is celebrated in Japan for his influence ending Japan’s centuries of isolation.

May 10, 1869 is also the anniversary of the completion of the transcontinental railroad.  Lack of manpower was a huge problem for the Central Pacific Railroad’s big four - Huntington, Stanford, Crocker and Hopkins - who assumed the responsible for laying the tracks from the Pacific to Promontory Summit. 

It was Charles Crocker who convinced work boss James Strobridge to hire Chinese labors.  At first Strobridge was reluctant, believing that they were too slight in stature to undertake the difficult work.  After hiring 50 labors for a trial period, he had to admit the Chinese were “conscientious, sober and hard workers.”   Within three years 80 percent of the Pacific Central work force was Chinese.

In 2013 the estimated number of U.S. residents who are Asian, Native Hawaiian or other Pacific Islanders was estimated at 20.8 million.  The largest Asian population, 6.1 million, is in California followed by New York at 1.8 million.  The largest Pacific Island population is found in Hawaii, followed by California with almost 366,500.

According to the Minority Business Development Agency of the U.S. Department of Commerce, over 1.5 million U.S. businesses are owned by Asian or Pacific Island residents.  Together they represent spending power in excess of $508.6 billion and have generated 2.8 million jobs.

California has the largest percentage of these businesses with receipts close to $200 billion. Within California, Los Angeles County is home to an estimated 35+ percent of the state’s Asian and Pacific Island businesses with a significant proportion of those located in the San Gabriel Valley.

Sometimes it takes a proclamation like Heritage Month to help us realize that whether as explorers, investors, laborers, or entrepreneurs, the contributions of Asians and Pacific Islanders are invaluable for our state, county, and our communities.  Remember those contributions to California next time you visit a locally owned Asian or Pacific Island business.

U.S. Funding for roads is dwindling

Among many pressing problems, our federal policy makers are struggling with re-authorization of the nation’s surface transportation legislation.  We take for granted that the federal government’s role includes overseeing commerce and the network of roads and highways that carry goods and people.

The federal government’s role in transportation policy has not always been so clear and in fact has evolved significantly over the years.  With the narrow exception of “post roads,” meaning roads that were to access a post office, the U.S. Constitution does not specifically call for a federal role in providing transportation. 

The debate as to whether this language permitted a federal government role in providing other non-post roads began in the 1800’s.  Representatives of western states – which were expanding and building roads – strongly supported federal assistance in funding new transportation.  Not unexpectedly, older parts of the young country opposed such funding.

Instead of providing cash, the government began to authorize federal land grants to states.  States then sold the land using the revenues to support not only roads and bridges but also canals and railroads.  By 1900 the federal government had donated 3.2 million acres of federal lands for road construction; 6.725 million acres for canals and improved river navigation, and 37.8 million acres for railroad improvements.  States had almost full latitude over project selection and oversight.

The 1900’s brought together two strong interest groups pressuring for direct federal funding for local transportation projects – first the bicycle riders and then the newly emerging car owners.  Between 1900 and 1915 automobile ownership in the U.S. increased from 8,000 to over 2 million.  Bicyclists and motorists alike were tired of muddy roads.

These groups effectively represented by the newly formed American Automobile Association, the National Grange, and the American Association of State Highway Officials, successfully lobbied for direct federal funding to match local funding for post roads in 1916. 

By 1921 there were over 10.2 million automobiles and the role of the federal government in surface transportation again came under review including the need for a federal highway system.  Stopping short of a federal highway system, the Federal Highway act of 1921 increased funding available to match state funding (50-50 matching) but limited the funds to a system of federal “aid” highways.  These were to be were “interstate in character.”

By the beginning of the 20th century, populations had shifted with nearly 40 percent of the population living in cities.  Subsequent transportation debates centered on the interests of rural and urban areas as each jockeyed for transportation funding.  In 1944 separate pots of funding were set up for primary highways, secondary highways and feeder routes so both urban and rural interests received protected funding.  The federal government solidified its role in transportation and previous constraints became an issue of the past.

A 41,000 mile National Interstate System was authorized in 1956.  The next 35 years of transportation policy focused on the completion of that system and how to pay for it.  Governors opposed increases in the gas tax. Trucking organizations opposed fees.  A one cent gas tax increase pledged to a dedicated Highway Trust Funds was finally supported by the majority of interest groups.  With the Interstate System came the first national standards for highway design and construction.

The Intermodal Surface Transportation Act of 1991 introduced a new emphasis on bus and light rail projects with a $32 billion appropriation specifically for mass transit.  The population was shifting again and roads alone were not able to move people efficiently in large urban centers. 

Today, two hundred years later, the role of the federal government in transportation is once again the focus of debate about federal transportation policy.  But rather than based on Constitutional issues, it is prompted by dwindling gas tax revenues because of fuel efficient and non-gasoline vehicles.   Unless there is some agreement on new taxes or other revenue sources, states may soon find themselves without a federal funding partner.  And this time don’t expect the federal government to give away land.

Let’s give a cheer for Tax Freedom Day

Is your wallet feeling a little lighter post-April 15?  Everyone dreads tax day.  We hate finding those receipts.  We detest the forms.  No one wants to revisit how they spent their money last year.  But the hardest part is writing that check.  On April 16 you feel like having a party.

While we associate April 15 with taxes, people pay some sort of tax almost every day.  In addition to income taxes there are sales taxes, property taxes, excise taxes, and estate taxes.

Individuals and businesses pay income taxes to the federal government based on wages and other income.  With the exception of Alaska, Florida, Nevada, South Dakota, Texas, Nevada, South Dakota, Texas, Washington and Wyoming, states also collect some form of income tax.

Californians are no strangers to sales taxes.  Individuals pay sales taxes on goods and some services. The sales tax is levied primarily to fund state and local government services.  Businesses collect the tax and submit it to the state.

Business and residents who own property pay property taxes based on the assessed value of the real estate.  The county usually collects the tax.  The process of dividing the tax varies by state.  In California the tax is remitted to the state which divides it among schools, counties and local governments based on a complex formula established by Proposition 13 and its progeny.

Excise taxes are taxes on specific services and products. The tax is included in the price rather than added at time of sale.  Examples include gasoline, tobacco, gambling winnings, and highway use fees paid by truckers.

The estate tax is based on the value of assets to be transferred after death.  In 2015, any estate with gross assets under $5,430,000 is exempt from taxation.  The portion of an estate that exceed this amount is taxed by the federal government.

Benjamin Franklin told us, “Nothing can be said to be certain except death and taxes.”  While we might not enjoy paying taxes, we understand why we pay taxes.  We want highways, parks, schools, emergency services and national defense to name a few benefits. 

However, paying different taxes to different levels of government at different times makes it difficult to understand exactly the total amount of taxes we pay.  The Tax Foundation, a nonpartisan research group, has found a simple way to help taxpayers understand their total tax burden. 

By counting total income, based on the Department of Commerce’s Bureau of Economic Analysis figures, then adding-up every payment to the federal, state or local government that is considered a tax, the Tax Foundation computes how many days a resident needs to work to pay their taxes for the year.  Count that number of days on a calendar and the next day is Tax Freedom Day!  Since state and local taxes vary, the day varies by state.

Californians, our 2015 Tax Freedom Day is May 3, the day we will have earned enough to pay our 2015 taxes. Does California have the latest Tax Freedom day?  No, that honor is reserved for Connecticut (May 13), New Jersey (May 13), and New York (May 8).  The earliest Tax Freedom Days are Mississippi (April 4) and South Dakota (April 8).

No matter how you celebrated April 16, I think May 3 deserves a celebration as well.  That is the day you start working for yourself.

Big business stepping up job creation

If someone asked you who employs more people - big businesses or small businesses - you’d probably reply small business.  That is the perception most of us have but it really isn’t quite that simple.

Every five years the U.S. Census Bureau collects data on the number of businesses, number of establishments, number of employees (full and part-time), annual payroll, cost of benefits and annual hours worked in each of 21 major industry sectors as a part of its Economic Census. They are incrementally releasing the 2012 Economic Census data as new reports are completed.

The Los Angeles Economic Development Corporation (LAEDC) has been reviewing the data and discovering some interesting facts.  For the sixth consecutive year, more than half of U.S. workers were employed by businesses with 500 or more employees.  The percentage of workers employed by big businesses is increasing and has since 2004 when it was 49.1 percent.

Of course, the employment data varies widely by sector.  In healthcare and social services, the largest U.S. employment sector, 54 percent of the jobs are with large businesses or organizations.   Jobs in retail sales and utilities are also dominated by big employers providing 64.1 percent and 82.6 percent of the total jobs respectively.

LAEDC found several business sectors that are populated primarily by medium, small or very small establishments.  These include personal services (85.8 percent), construction (83.3 percent), real estate and leasing (69.3 percent), arts, entertainment and recreation (63 percent), accommodations and food services (59.9 percent), wholesale trade (59.6 percent), and professional, scientific and technical services (59.5 percent).

Large employers - those with more than 500 positions - employ 51.6 percent of the workforce.  Medium size employers - those with 100 to 499 positions - employ 14.0 percent of the workforce.  Small employers - 20 to 99 positions - employ 16.7 percent while very small - fewer than 20 positions - employ 17.6 percent. 

In California, 50 percent of businesses have 500 or more employees just 1.6 percent fewer than the national average, with the remaining 50 percent of employment spread between medium, small and very small businesses.

Why do we usually associate more jobs with medium and small business? Probably because small business grows faster and are created more frequently than larger ones. Small businesses are often more innovative.   But they are also more vulnerable to economic swings and can lost jobs quickly. 

Still medium and small businesses are a critical part of our economy and they are producing new jobs for Southern California every day.

If you want like more information on jobs creation in Los Angeles County and the San Gabriel Valley, plan to attend the San Gabriel Valley Economic Partnership’s 2015 Economic Forecast on Tuesday April 21, 2015 at Pacific Palms Resort.  Dr. Robert Kleinhenz Chief Economist of the Kyser Center at LAEDC will provide the most recent data. More information is available at sgveconomicoutlook2015.eventbrite.com or www.valleyconnect.com