Teachers Earn Less Than Their Private-Sector Counterparts, Research Shows

Teachers tend to have better benefits than their private-sector counterparts, but those aren't enough to offset the difference in wages, the analysis says.

Teachers tend to have better benefits than their private-sector counterparts, but those aren't enough to offset the difference in wages, the analysis says. Shutterstock

 

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Teachers have a 21.4 percent "wage penalty" compared to college graduates with similar education and experience, according to new research from the Economic Policy Institute.

Teachers were paid more than 20 percent less per week last year than college graduates with similar abilities and experience, according to new research from the Economic Policy Institute.

“These trends influence the career choices of college students, biasing them against the teaching profession, and also make it difficult to keep current teachers in the classroom,” wrote researchers Sylvia Allegretto and Lawrence Mishel with the liberal-leaning think tank.

According to their research, the so-called “wage penalty”—the percent by which public school teachers are paid less than other college-educated workers—has increased dramatically over the past 30 years. The gap grew from 5.3 percent in 1993 to 12 percent in 2004, topping out in 2018 at 21.4 percent.

The report, the second in a series of six on the national teacher shortage, uses data from the Bureau of Labor Statistics to analyze wage and benefit compensation for public-school educators across the country.

The research found that average weekly wages for teachers had decreased over time, from $1,216 in 1996 to $1,195 in 2018. Weekly wages for other college graduates increased during that same time period, from $1,454 to $1,777, accounting for the growing gap between the two.

Notably, the researchers said, the wage penalty shrank in the beginning of the Great Recession, but it’s increased steadily since.

“This trend was more than reversed in the recovery beyond 2010 as state and local spending cuts sapped teacher wage growth while private-sector wage growth accelerated,” the report says. “The estimated 21.4 percent teacher weekly wage penalty in 2018 means that, on average, teachers earned just 78.6 cents on the dollar compared with what other college graduates earned.”

Those findings are at odds with the results of a separate study from the American Enterprise Institute, a conservative think tank. That research, published this month, found that factoring in benefits, including pensions, actually boosts public-sector wage growth ahead of the pace of increases in the private sector.

From 1998 to 2017, “there is not a single state in which pay and benefits for state and local government employees grew more slowly than for private sector workers,” the study’s author told Route Fifty.

EPI researchers reached different findings. Their report acknowledges that benefits have improved for teachers—last year, non-wage benefits “made up a greater share of total compensation for teachers (29.1 percent) than for professionals (21.5 percent),” giving teachers an 8.4 percent “benefits advantage.”

But that’s not enough to offset the wage gap, they argue. Subtracting that benefits advantage from the 21.4 percent wage penalty still leaves teachers with a 13.1 percent overall compensation penalty compared to their private-sector counterparts, only slightly less than the record-high compensation penalty of 13.3 percent in 2017.

“This growing compensation penalty is a key part of the story of changing teacher pay but shouldn’t obscure the importance of the wage penalty alone,” the report says. “Only wages can be saved or spent on housing and food and other critical expenses.”

State by state, the wage penalty ranges from .2 percent (Wyoming) to 32.6 percent (Arizona). Twenty-one states and the District of Columbia have wage penalties higher than 20 percent, while four of the seven states with the highest gaps—Arizona, Colorado (30.7 percent), Oklahoma (29.7 percent) and North Carolina (26.5 percent)—were the site of major teacher protests last year.

Decreasing wages and increasing inequality between professions are key components of the ongoing teacher shortage, the report concludes.

“Raising the level of teacher compensation, including wages, is critical to recruiting and retaining teachers who have the qualifications associated with teacher effectiveness in the classroom,” researchers wrote. “Simply put, improving public education in this country—by preventing teacher turnover, strengthening retention of credentialed teachers, and attracting young people to the teaching profession—requires eliminating the teacher weekly wage and compensation penalty.”

Kate Elizabeth Queram is a Staff Correspondent for Route Fifty and is based in Washington, D.C.

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