Panel Paper: Trends in Relative Teacher Wages and Compensation

Saturday, November 9, 2019
Plaza Building: Concourse Level, Governor's Square 17 (Sheraton Denver Downtown)

*Names in bold indicate Presenter

Sylvia Allegretto, University of California, Berkeley and Lawrence Mishel, Economic Policy Institute

Teacher strikes in West Virginia, Oklahoma, Arizona, North Carolina, Kentucky, and Colorado in 2018 raised the profile of deteriorating teacher pay as a critical public policy issue. Teacher protests have continued in many states in 2019 and there have been several prominent strikes in major cities including Los Angeles, Oakland and Denver. Teacher protests gained sufficient attention to warrant three cover stories in Time magazine in September 2018.

Providing teachers with a decent middle-class living commensurate with other professionals with similar education is not simply a matter of fairness. Effective teachers are the most important school-based determinant of student educational performance. To ensure a high-quality teaching workforce, schools must retain experienced teachers and recruit high-quality students into the profession. Pay is an important component of retention and recruitment.

As we have shown in our more than a decade and a half of work on the topic, relative teacher wages, as well as total compensation—compared with the wages and total compensation of other college graduates—has been eroding for over a half a century. These trends concern the career choices of college students as well as in keeping current teachers in the classroom.

For all public-sector teachers, the relative wage gap (controlling for education, experience, and other factors known to affect earnings) has grown substantially since the mid-1990s. The teacher wage penalty was 5.3 percent in 1993, grew to 12.0 percent in 2004, and reached a record 21.4 percent in 2018.

Our previous research found that women teachers earned 14.7 percent more in weekly wages than comparable women workers in 1960. This report finds that the teacher weekly wage premium for women teachers had fallen to 6.9 percent in 1979. And the wage premium for women teachers largely disappeared in the 1980s and 1990s, replaced by a large and growing wage penalty in the 2000s and 2010s. In 2018, women public school teachers were making 15.1 percent less in wages than comparable women workers.

The weekly wage penalty for men teachers was 17.8 percent in 1979 and improved to 14.2 percent in 1993, but worsened in the late 1990s into the early 2000s. In 2018, men public school teachers were making 31.5 percent less in wages than comparable male workers—like goes a long way in explaining why the share of males in the teaching professional has not change much in decades.

Bring in benefits. As a result of their growing benefit share of compensation, teachers are enjoying a “benefit advantage” that has grown from 1993 to 2018, rising from 2.4 percent to 8.4 percent. But this has not been enough to offset the growing wage penalty. The total teacher compensation penalty was 13.1 percent in 2018 (composed of a 21.4 percent wage penalty plus a 8.4 percent benefit advantage), just slightly less than the record high 13.3 percent compensation penalty in 2017. The bottom line is that the teacher compensation penalty grew by 10.2 percentage points from 1993 to 2018.