By Kaitlin Mulhere
April 11, 2018

School gyms across Oklahoma transformed into hostels last week, as a group of teachers marched more than 100 miles through rain and blisters to deliver a message to state lawmakers.

They want more: More resources for their classrooms. More respect for their profession. More money in their paychecks.

Teachers in Oklahoma, as well as Kentucky and Arizona, have taken a cue from the success of teacher protests in West Virginia, and there’s been rumors that grassroots movements could form in other states or districts with chronically low education funding.

It’s no secret teaching is low-paid profession. So what’s spurred this sudden cross-country activism? A mix of flat pay, rising benefit costs, state budget cuts, changes in student enrollment, and years of lackluster teaching resources. Here are seven charts that explain how teachers’ pay has fallen and why it’s not been easy for states to simply restore years of funding reductions.

Teacher Salaries Have Been Flat—or Falling

While the economy has gradually recovered from the 2008 recession, many middle-class workers still haven’t seen their earnings rebound. That’s true among teacher salaries, too.

As the orange arrows in this chart from news website Axios show, in 39 states the average teacher earned less in 2016 than they did in 2010, once you adjust for inflation. You’ll notice that many of the states where teachers have protested are at the bottom of the chart.

Teachers Often Earn Less Than Other Professionals

Teachers—who are required to have at least a bachelor’s degree, and in some districts a master’s degree, too—also frequently earn less than peers with similar education levels, according to a measure designed by the Urban Institute. The dark blue bars in the chart below show what teachers might expect to earn in each U.S. state based on how well other bachelor’s degree holders get paid in that state. The light blue bars show what teachers actually earn.

In 29 states teachers earn significantly less—at least $1,000 less—than what other employers pay to attract and retain similar workers. Teachers do come out ahead in some places, likely either because of effective unions or extra credentials like master’s degrees. In 13 states plus the District of Columbia teachers earned $1,000 or more than similar workers, while in eight states, the gap was within a few hundred dollars.

Below are the gaps in the states with the five highest rates of payroll spending per employee and the states with the five lowest rates, based on data from 2012. (The full list is available here.) You’ll see that in Kentucky and Oklahoma, two states where teachers have protested, the average teacher salary was about $6,000 less than you’d expect.

 

Teachers Are Being Asked to Chip In More For Benefits

Teachers—and other public sector employees—have always enjoyed better benefits compared to private sector peers. The Economic Policy Institute estimates that benefits, including health insurance, retirement pensions, and payroll taxes add up to about 27% of teachers’ total compensation, compared to 22% for other professionals.

And yet, teachers have had to shoulder a larger portion of health care costs compared with other local and state employees, according to Vox. A decade ago, teachers paid 35% of their health insurance premium for a family plan. In 2017, Vox found that had increased to 38%. As a result, teachers have had to pay nearly $1,500 more than other state employees toward their insurance premiums.

It’s All About Location

About one out of every five dollars state and local governments spend goes to elementary and secondary schools. And more than 45% of that money goes toward payrolls, according to the Urban Institute. That means the key to teacher pay is state and local taxes. And some places—with strong local economies—are richer than others.

As sociologist Joshua McCabe argued in the National Review, the true cause of low, stagnant teacher pay in West Virginia isn’t tax cuts or even a lack of political will, it’s the state’s capacity to raise money. In fact, West Virginia spent 4.3% of its gross domestic product on education in 2014—higher than all states except Vermont, New Jersey, and Maine. New Jersey can spend more per student than West Virginia, even though both states devote a similar share of their GDP to education, because New Jersey is a richer state and has a much larger GDP.

“It is impossible to address the teachers’ grievances without addressing limited fiscal capacity among poor states,” McCabe writes. This isn’t a new problem, either, he says: Eighty years ago, advisors explained to President Franklin D. Roosevelt in a report on the economies in southern states that they devote a larger relative share of their tax income to schools; they just have fewer resources per child.

And Many States Have Had to Cut Spending

Despite the economic recovery, many state are still strapped for resources. As the chart below from the National Association of State Budget Officers (Nasbo) shows, fewer states faced budget shortfalls last year than during the dark days of the 2007-08 recession. But the number that did—22—was still significant and more than double the number that did as recently as 2014.

Some states have missed budget targets as a result of policy choices, including tax cuts that reduced revenue in places like Arizona or Kansas. Others struggled because of the industries their economies are built on. Low oil prices, for example, have hurt energy-reliant states such as Louisiana and Oklahoma. Whatever the reason, reduced revenue squeezes the money that’s available for education spending.

Plus, Benefits Are Eating Up a Larger Chunk of Budgets

While teachers have been asked to chip in more for their benefits, states have been doing so, too. Twenty years ago, benefits comprised about 20% of total compensation. In 2014, the year with the most recent data available, that share had grown to 28%, as the red line in the chart below shows.

Note: Amounts are in 2014 dollars. Figures based on calculations by Nat Malkus at AEI, using NCES Common Core of Data.

One big reason for the cost explosion: pensions.

To be sure, this is partly states’ fault. For years legislatures promised generous benefits to teachers and other government employees while skimping on what they socked away to cover future obligations. Now those states have to play catch up. That means using a greater share of education tax dollars to pay retired teachers, rather than ones who are working in classrooms today.

In fact, for every $10 spent today on teacher pension plans, about $7 goes toward paying down debt to cover past pension obligations, according to a report by Chad Alderman of Bellweather Education Partners. Only $3 goes toward future benefits for today’s teachers.

“States continue to spend more money, but employees are seeing less of it,” says Nat Malkus, deputy director of education policy at the American Enterprise Institute.

Student Demographics Play a Role, Too

Several states in the South and West have had to spread money for education over a larger student population in the past few years, a trend that’s expected to continue. That adds another level of difficulty to raising money for salary hikes. Arizona and Oklahoma, for example, have seen their per student spending fall dramatically because of funding cuts, but also because each has seen enrollments climb at a faster rate than most other states. And federal statistics estimate enrollment in those two states will continue to grow in the coming decade, as the map below shows.

What’s the Solution?

Research has found that paying teachers more can attract more qualified candidates to the profession and keep them from leaving. And anecdotal evidence and unofficial polling suggests a significant share of the public agrees that teachers earn too little. How can we avoid protests in other cities and states where education funding has been squeezed?

Some factors, like student population, are beyond states’ control. Likewise, states can’t change the value of their property or economic resources. Many of the states with low education funding, including all four where there have been protests, have a combination of low total taxable resources and populations that need expensive social services, according to an Urban Institute report. The bottom line is that some of those states couldn’t raise enough money to meet average spending rates even if they taxed their populations more.

McCabe thinks that a grant from the federal government to equalize those disparities in state wealth would get to the source of the problem. Malkus writes that salaries will remain flat as long as pension and insurance costs keep swelling.

It’s all about tradeoffs, says Tracy Gordon, a senior fellow at the Urban-Brookings Tax Policy Center. And those tradeoffs may look different in every state. Smaller class sizes and more teacher pay, for example, are both costly, and they can often be in opposition with each other. If we want to pay teachers better, we can raise taxes, or increase class sizes, or cut services somewhere else, like school facilities, roads, or prisons.

“The money has to come from somewhere,” Gordon says. “And that’s the question I find people don’t engage in.”

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