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In principle, the dropout rate for a cohort of students is simple to define and measure—it is the proportion of students in a cohort who leave school without obtaining a high school diploma or its equivalent. For example, the simple cohort survival rate measures the ratio of the number of high school graduates in a given year to the number of high school freshman in the high school four years before.[i] In practice, however, the computation of dropout rates at the district level is complicated by high rates of mobility of students among schools, districts, and states. At the district level, it is sometimes unclear which school district is responsible for counting students who switch between districts within a four-year period.  As a result, mobile students may be counted as a dropout from neither, either, or both districts. Existing data systems do not enable district officials to track these highly mobile students.
 
There are several measures for calculating dropout rates and tracking the enrollment status of students. These methods, though imperfect measures of the actual dropout rate, are nonetheless useful as long as those seeking to make use of the data understand the formulas and definitions that define each measure. It is also important to keep in mind that dropout and graduation figures are not perfectly complementary. A high school student continuing in the education system beyond the traditional four-year period may be counted as either a dropout or a graduate—or neither--depending on how dropout and graduation rates are defined. It is therefore important to present the drawbacks and benefits of various published methods of documenting dropouts in order to evaluate the advantages and disadvantages of each.
 
The National Center for Education Statistics publishes event, status, and cohort dropout rates to provide different perspectives on the student dropout population. [ii] Event rates describe the proportion of students in a given age range who leave school each year without completing a high school program. This annual measure provides information on recent dropout and provides important information about how effective educators are in keeping students enrolled in school. Status rates provide cumulative data on dropouts among all young adults within a specified age range regardless of when they last attended schools. Status rates reveal the extent of the dropout problem in the population but are higher than event rates because they include all dropouts in a given age range. Finally, the National Center for Education Statistics (NCES) also publishes cohort rates to track a group of students over a period of time and reveal how many students starting in a specific grade drop out over time.[iii]
 
In California, school districts report the dropout rate data they obtain from CBEDS to the California Department of Education (CDE). The CDE calculates a one-year dropout rate based on the percent of dropouts during a single year, calculated from actual data submitted.[iv] This method of calculation is the equivalent of the NCES event rate. The CDE also calculates a four-year derived dropout rate, which is an estimate of the percent of students who would drop out in a four-year period based on data collected in a single year.[v]

[i] Specifically: where  is enrollment in grade y, year t.

[ii] www.nces.ed.gov

[iii] Specifically, the NCES graduation rate is calculated as:  where is 12th grade graduates in year t, and is dropouts in grade y, year t.

[iv] California Department of Education 1-Year Rate Formula: (Grades 9-12 Dropouts/ Grades 9-12 Enrollment)*100

[v] California Department of Education 4-year Derived Rate Formula: (1-((1-(drop grade 9/enroll grade 9))*(1-(drop grade 10/enroll grade 10))*(1-(drop grade 11/enroll grade 11))*(1-(drop grade 12/enroll grade 12))))*100