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President Obama: An A+ for Education Stocks?

During President Obama's first formal address to Congress last night, Mr. Obama emphasized his administration's plans to invest in education. Indeed, President Obama asked "Every American to commit to at least one year or more of higher education or career training." At a time when the unemployment rate stands at 7.6 percent, its highest level since 1992, the need to Improve American workers' skills is among the top priorities of the current administration.

"Countries that out-teach us today will out-compete us tomorrow," the President said, highlighting the importance for America to keep up with other nations. The US currently has one of the highest high school dropout rates among industrialized nations, while three-quarters of the fastest-growing occupations require more than a high school diploma, Mr. Obama added. The President set a goal that by 2020 the US should have the highest proportion of college graduates in the world.

The President's goal fits with a long-term trend in growth of education in this country. While the unemployment rate hit 17-year highs, educational services jobs have been surging.

Since the market peak in October 2007, the education sector has seen job growth in 13 of the past 16 months and has added 150.5 thousand jobs overall, a gain of 5%. In fact, a number of educational stocks have been showing upward trends in the past few months and some are hitting new 52-week highs. Career Education, for example, is trading above its 52-week high, gaining nearly 40% in the past three months. Will President Obama's goal for 2020 give an additional boost to some of these stocks?

Companies providing educational services include:



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