This report looks at the decline in student retention rates in Australian schools. Student retention rates up to Year 12 grew significantly across Australia from around 33 per cent in the 1980s to 77 per cent in 1992. The national figure has since dropped each year and in 1995 was at 72 per cent. This study analyses the underlying factors for the drift away from school and discusses social and economic implications of this on young people. This report, published by the Australian Council for Education Research (ACER), is part of the Longitudinal Surveys of Australian Youth (LSAY) research program.