Pay Losses for Teachers Continue

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August 9, 2016; Economic Policy Institute

For generations, education has been the springboard to opportunity in America.”

This conclusion is more than just the driver for the Bill and Melinda Gates Foundation to invest billions in efforts to improve public education. It summarizes our nation’s widely shared belief that a quality education is a fundamental right and an essential component of individual and communal success. According to a 2015 Organization for Economic Cooperation and Development (OECD) report, as a nation, in 2012 we devoted 3.6 percent of the gross domestic product to elementary and secondary education—$11,700 per student.

Yet while we think education is valuable, we don’t think our teachers are worth very much at all. Some say teachers are overpaid for working a part-time job with the summers off. But a new study conducted by the Economic Policy Institute indicates that when compared to similarly trained workers in other fields, teachers earn less—and the gap is growing.

The teacher pay penalty is bigger than ever. In 2015, public school teachers’ weekly wages were 17.0 percent lower than those of comparable workers—compared with just 1.8 percent lower in 1994.

As unfair as that looks, the picture is even more stringent in the details. Between 1996 and 2015, after adjusting for inflation, public school teachers saw their pay decrease by $30 a week while the weekly pay for college graduates overall grew by more than $100. Teaching had been a field where women could find a relatively “favored” position. In 1960, female teachers earned almost 15 percent more than their peers did in other fields; by 2015, they were earning 14 percent less. Experienced teachers earned slightly more than their peers in other fields in 1996, but today they find their salaries lagging by almost 18 percent.

But don’t the great pensions and other benefits that teachers and their unions receive offset these gaps in salary? Not really. When benefits are included, the study found “the total teacher compensation penalty was a record-high 11.1 percent in 2015 (composed of a 17.0 percent wage penalty plus a 5.9 percent benefit advantage). The bottom line is that the teacher compensation penalty grew by 11 percentage points from 1994 to 2015.”

Not paying competitive salaries does matter. Teacher shortages have become serious as increasingly experienced teachers retire and the pool of teachers entering the field shrinks. As Stanford University Professor Linda Darling-Hammond points out:

Even if teachers may be more motivated by altruism than some other workers, teaching must compete with other occupations for talented college and university graduates. […] Teachers are more likely to quit when they work in districts with lower wages and when their salaries are low relative to alternative wage opportunities, especially in high-demand fields like math and science.

Policymakers emphasize the importance of effective teaching. Many reformers see it as critical in confronting the impact of poverty and race on educational success. We have heard louder and louder demands for teacher accountability based on measurable outcomes. These calls are often combined with a desire to tie compensation to these outcomes but do not recognize the need to pay teachers fairly to compete in the marketplace for college graduates.

In our society, compensation often stands as a critical measure of value and importance. Noncompetitive pay is more than just an economic issue; it’s a statement of how much we respect the educational profession. To pay teachers poorly and devalue the rigor required to be an effective teacher is not a formula for solving educational problems, yet it’s the recipe that many in the forefront of school reform keep urging us to use.—Martin Levine