Big teacher pay proposals are missing the mark

Democratic Presidential candidate South Bend, Ind., Mayor Pete Buttigieg just unveiled a $700 billion education plan in which he pledged to “honor teachers like soldiers” and “pay them like doctors.” In doing so, Buttigieg joined a long line of 2020 hopefuls such as former Vice President Joe Biden and Sen. Bernie Sanders (I-Vt.) who’ve announced plans to boost teacher pay. It’s easy to see why pols would be motivated to tackle teacher pay: Not only are teacher unions a significant force in the Democratic nominating process, but 72 percent of Americans say that teachers should be paid more. And this is all in the public eye due to a wave of teacher strikes in recent years, in locales that range from Los Angeles and Chicago to West Virginia and Oklahoma.

It’s heartening to see this focus on teacher pay. Terrific teachers are underpaid. School system rolls are too often bloated with administrative and support staff, which means less money for classroom educators. Too much teacher compensation is tied up in benefits, shrinking take-home pay — and pay systems do little to acknowledge teachers who work exceptionally hard or who are exceptionally good for students.

Unfortunately, the teacher pay conversation has been more narrowly framed by the problematic assertion that America’s teachers are systematically underpaid relative to similar workers. Yahoo News has asserted “teachers now make more than 20 percent less than similarly educated professionals.” The Washington Post reported that the “teacher pay penalty” was a “record 21.4 percent” in 2018, while New York Magazine lamented that teachers “could expect to be paid far less than college graduates in other professional fields.” 

Here’s the catch: It’s not at all clear that this is true. In fact, the methodology used to produce the “teacher pay gap” is hugely suspect. Applied to other fields, for instance, it finds that nurses are overpaid and that telemarketers are underpaid.

Indeed, the source of the “teacher pay gap” statistic is an annual report by the energetically progressive Economic Policy Institute (EPI). To determine that teachers are paid 21.4 percent less than their peers, the EPI report compares income with years of education and basic demographic information (such as age and marital status), and then attributing any salary differentials to the profession. Yet, as noted above, applying the same methodology to other professions yields some pretty bizarre results. Using the EPI model, for instance, analysts Andrew Biggs and Jason Richwine calculate that nurses are “overpaid” by 29 percent, firefighters by 25 percent, and aerospace engineers by 38 percent — while telemarketers are “underpaid” by 26 percent.

The problem is that EPI’s research method — comparing people’s salary based on their educational attainment — is lacking. As Biggs and Richwine observe, salaries are determined by a variety of factors (such as supply and demand) even after accounting for how long someone went to school. The EPI method treats all bachelor’s degrees as equal. But they’re not: An engineering degree and a literature degree both require about the same number of years of schooling but yield wildly divergent average pay upon graduation. 

If teachers were as underpaid as EPI suggests, one might expect a large share of teachers to quit their jobs each year so they could move to higher-paying work. Instead, for all the talk of teacher turnover and teacher shortages, the reality is that teachers quit less often than their private sector counterparts. The quit rate, as measured by the Bureau of Labor Statistics, is roughly three times lower for public school teachers than for private sector employees. Moreover, it turns out that only five percent of departing teachers cite “salary and other job benefits” as the reason for their departure.

Don’t misunderstand. We’re not suggesting that teachers are living large. But, in most locales, teachers are faring reasonably well. Nationally, the NEA reports that an individual teacher earns $60,477 a year — which is nearly the same as the median American household ($63,179), and meaning that a married couple composed of two teachers is well into the top quintile of household earnings. The poverty rate for teachers is 1.1 percent. And a Federal Reserve survey found that 81 percent of teachers describe their financial situation as either “doing okay” or “living comfortably,” while just 2.7 percent report “finding it hard to get by.” Meanwhile, teacher health care and retirement benefits are generally far more generous than those of their peers in the private sector. In short, this is the picture of a solidly middle class profession.

None of this is to deny that there are states and communities where teachers are indeed sorely underpaid or to suggest that terrific teachers are paid well enough. On the contrary, there is much room for improvement.

It’s ridiculous to design a pay system in which plenty of outstanding teachers spend two or three months a year bartending or painting houses. New spending could be used to turn teaching into more of a full-time profession, where great teachers are compensated for taking on leadership roles, designing curricula, and mentorship. At the same time, it’s essential to overhaul benefits. Former Obama education official Chad Aldeman notes that, for every ten dollars that states and districts contribute to pension plans, seven dollars pay down past pension debt, while just three go to benefits for current teachers.

The concern is that ideas like these will get short shrift as long as advocates, pundits, and pols remain fixated on dubious claims of a “pay gap” and so long as candidates propose to spend big on pay systems that don’t address the biggest challenges.

Frederick M. Hess is the director of education policy studies at the American Enterprise Institute. RJ Martin is a research associate at AEI.