| Author | Message | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
     Jerry Moore (Admin) Board Administrator Username: Admin Post Number: 10369 Registered: 01-2000  Rating: |
Parsing the NEA’s Average Teacher Salaries PART 1. NY'S True Average Teacher Salary What you'll learn in this commentary:
What you need to know:
Introduction The National Education Association recently announced that the national average teacher salary for 2003-04 was $46,752 and had “remained flat, growing just 2.9 percent in inflation-adjusted dollars” over the last decade. If you believe this, you must believe the most powerful labor union in the United States is impotent—unable to improve teacher compensation any more than it is able to improve academic outcomes. And if it were true, wouldn’t you expect widespread defections as highly educated teachers search for more “respect” from unions offering a better deal? Well it’s not (impotent) and they aren’t (abandoning the union in droves). That’s because the insiders know the truth is not as bleak as publicly portrayed. The NEA’s salary report is as much a political document crafted to increase the NEA's power by manipulating public perceptions to create empathy for better teacher compensation as it is a research document, appearances to the contrary notwithstanding. In this series, we'll take a closer look at the 2005 report of rankings and estimates to see whether the perceptions it creates are closer to myth or reality. Comparing the NEA average teacher salary to the BLS The Bureau of Labor Statistics publishes employment and wage statistics for hundreds of occupations, including public school teachers. Recently, it began reporting salaries at the 10th, 25th, 75th and 90th percentiles in addition to mean and median salaries. In this first chart the NEA’s top 25 2003-04 average teacher salaries are compared to the most recent BLS average teacher salaries, which I have computed by taking the average of the number of teachers employed in each of 9 teacher classifications multiplied by the average salary for each classification. The classifications I used for each state (excluding the District of Columbia, which lacked sufficient data), when available, are:
 The dark green line tracks the NEA’s average teacher salaries. The red line tracks the average salary calculated from BLS data. When the area between the dark green and red lines is light green, the NEA’s average teacher salary is higher than the BLS average. When this area is red, the BLS average is higher than the NEA’s. The more green or red you see for a given state, the greater the disparity between NEA and BLS data. In general, the smaller the shaded area between the two lines, the more likely it is that the reported averages are very close to the actual average. For example, the NEA reports RI’s average teacher salary as $52,261 and the derived average for BLS data is $51,960—a $301 difference (0.6%). For GA the difference is $234 (0.5%). These are likely to be very close to the true average teacher salaries in RI and GA. However, the wide divergence between NEA and BLS NY average salaries strongly suggests something is wrong. Generally, NEA averages are higher than those from the BLS. For the 50 states, NEA salaries are an average of $615 (1.4%) higher than BLS salaries. The reasons for the difference are many and nuanced, and I’ll point some of them out in this series of articles. New York The divergence between NEA and BLS average salaries is by far the greatest for NY. The NEA reports an “average” of $55,181 and the BLS average is $65,441, a difference of $10,260 (18.6%). The broad spread suggests that one or both of these numbers may be unreliable. The most likely reason for the difference is that for NY, and only for NY, the NEA uses NY’s median teacher salary, not the average. The $55,181 median salary is exactly the same as reported by the New York State Education Department Information, Reporting and Technology Services, which you can see here, along with the salaries for more than 680 NY public school districts. One might be tempted simply to adopt the $65,441 BLS average as the true average except the BLS median NY teacher salary is $62,151, or $6,790 higher than reported by the state. Here’s a comparison of the state and BLS percentile salaries for NY:
There’s no easy explanation for why the BLS 10th-percentile salary is $543 less than the state 5th-percentile salary while the BLS 90th-percentile salary is $13,670 above the state 95th-percentile salary. Since we know that state data is compiled from nearly every school district (with variations in reliability), let’s assume the state data are more accurate than the BLS data. What we want to know is NY’s average teacher salary. Here’s NY’s percentile salaries imposed on a bell curve.  If NY’s salaries were symmetrically distributed around the mean, we’d expect the average salary to be close to $59,535 (point D). But we know the salary schedule is skewed. We know this because the 5th, 25th and 50th percentiles are bunched together, while the 75th and 95th percentiles are spread apart. Between the 5th and 50th percentiles, teacher salaries increase by $18,781 (51.6%). Between the 50th and 95th percentiles, they increase $37,819 (68.5%). We also know that teachers are not evenly distributed on the salary schedule because there are relatively more senior teachers than mid-career and new teachers, and that NY salary schedules tend to award senior teachers with larger percentage step increases (despite new- and junior-teacher value rising far faster as they gain experience relative to senior teachers). We also know that teachers typically stay on the top step for a number of years. Although these cut in different directions, overall they seem to suggest that the $59,535 average salary calculated above is probably smaller than the true average. Another way to see the skew is to notice that at point A a teacher earns $35,000, which was about the average starting salary in 2003-04. If teacher pay were symmetrical, we’d expect it to top out at point B, $85,000. But it doesn’t top out (at the 95th percentile) until point C, just over $93,000. What's the minimum NY's average teacher salary could be? While the BLS data may be suspect, the spread between the median salary ($62,151) and the average ($65,441) may be fairly accurate. This spread is $3,290 (5.3%). If the same spread applies to state data, we could expect the average salary to be 5.3% higher than the reported median salary of $55,181, or $58,106. Here are some possibilities for NY's average teacher salary:
At the very least, NY's average teacher salary is $58,106, which beats NEA 1st-ranked Connecticut ($57,337) by $769. But NY's average could be as high as $66,712. More than likely, NY's true average teacher salary is very close to $59,000, which not only trumps CT by over $1,600 but also makes it a statistical outlier in teacher pay. NOTE: The NEA appropriately calculates the national average (gross salary before deductions but excluding supplemental salaries, extra-duty pay and fringe benefits) by weighting each state average by the number of its instructional staff members. The salaries of states with more teachers—like CA, TX, NY, FL and IL, with over 1.2 million (35.3%) of the nation’s 3.5 million instructional staff—contribute more to the national average than the salaries of states with few teachers—like SD, ND, AK, DE and WY with 37,052 (1.06%) instructional staff. 
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Jerry Moore (Admin) Board Administrator Username: Admin Post Number: 11165 Registered: 01-2000 Rating: |
Parsing the NEA’s Average Teacher Salaries PART 2. Nuances in NEA Average Salaries What you'll learn in this commentary:
Introduction In Part 1, I began a comparison of average teacher salaries by state as reported by the National Education Association (NEA) and as reported by the Bureau of Labor Statistics (BLS). We learned that the NEA uses average teacher salaries for every state except NY, for which it uses a median salary of $55,181. By using several approaches, the best estimate for NY's average teacher salary was calculated to be very close to $59,000, making it the highest in the country. In this lesson, I'll briefly compare NEA and BLS average salaries for the other states. I'll point out known problems, but no rigorous attempt will be made to correct for them, as I did with NY. For background information on how BLS average teacher salaries were calculated, see Part 1. Comparing the NEA average teacher salary to the BLS The dark green line tracks the NEA’s average teacher salaries. The red line tracks the average salary calculated from BLS data. When the area between the dark green and red lines is light green, the NEA’s average teacher salary is higher than the BLS average. When this area is red, the BLS average is higher than the NEA’s. The more green or red you see for a given state, the greater the disparity between NEA and BLS data. In general, the smaller the shaded area between the two lines, the more likely it is that the reported averages are very close to the actual average. For example, the NEA reports RI’s average teacher salary as $52,261 and the derived average for BLS data is $51,960—a $301 difference (0.6%). For GA the difference is $234 (0.5%). These are likely to be very close to the true average teacher salaries in RI and GA. However, the wide divergence between NEA and BLS NY average salaries strongly suggests something is wrong. Generally, NEA averages are higher than those from the BLS. For the 50 states, NEA salaries are an average of $615 (1.4%) higher than BLS salaries. The reasons for the difference are many and nuanced, and I’ll point some of them below. The 25 Highest NEA Average Teacher Salaries Aside from NY, VA is the only other state where the BLS average salary significantly exceeds the NEA average salary. The reason for the disparity is unknown. IL, NC, OR and MD have average BLS salaries that are significantly below NEA's data. The NEA reports that the average salary for IL may include extra-duty pay, which presumably is not part of the average salary reported for other states. IL's NEA average salary is about 12% higher than the BLS average. It's unlikely that more than half of the difference is caused by the addition of extra-duty pay in the NEA data. If true, IL's average teacher salary would be closer to $51,400 than the NEA figure of $54,230. The NEA average for OR includes a 6% employer retirement contribution in some cases. But the NEA and BLS data diverge by 10%. Again, assuming that about half the divergence is due to this anomaly, OR's average salary is likely much closer to $46,850 rather than the $49,169 reported by the NEA. The reason for the divergence in NC and MD's average salaries is unknown. For PA, the NEA reports an average salary of $51,835--$1,774 more than the BLS. This may be a result of estimating the full-time equivalent (FTE) weighting by formula rather than by the direct averaging the NEA uses for other states. The 25 Lowest NEA Average Teacher Salaries  The average teacher salaries for the remaining states are shown in the chart, above. The scale on this chart is not the same as for the highest paid states. In the first chart, the green area for NC is roughly the same as the green area for KS, above. But, the difference represented by the green area for KS in the second chart is only about half the dollar size as the difference for NC. That's because the Y-axis has $1,000 increments in the second chart, but $2,000 increments in the first chart. Of the states with moderate to large divergences, only KS, NE and ND have possible explanations. In KS, the NEA data include base salary, supplemental salary and fringe benefits. This is probably why the NEA's average salary of $38,623 exceeds the BLS average of $36,315 by $2,308. The BLS average for KS is probably more reliable. In calculating the average salary for Nebraska, the NEA excludes substitute teachers. That, in itself, is an important piece of information, since substitute teachers are typically paid far less than full-time teachers. This would tend to make teacher salaries appear lower than they are for full-time teachers, which is what most people think about when they hear about average teacher pay. In NY, substitutes earn about half the daily wage of a new full-time teacher. Still, this doesn't explain why BLS averages are $615 lower (on average) than the NEA averages. And it doesn't explain why NE's BLS average is higher than the NEA average. It's a conundrum. Finally, for ND, the NEA excludes the salaries of tutors and small group instructors. This might explain why the NEA average for ND is higher than the BLS average--$35,441 to $34,436 for a difference of $1,005. Conclusion Overall, BLS and NEA average teacher salaries are within 2% of each other, but differences in data and formulas for calculating averages can cause a significant divergence between the BLS and NEA salary for particular states. For NY, IL, PA, OR, KS and ND, the reasons for the disparities are largely known. In other states with a moderate to large divergence--MD, NC, AZ, IA, AR, VA, ID and TX--the reasons are unknown. It's clear that NEA averages are too high in some states and too low in others, and the BLS data help to confirm this. But what we don't know is if the BLS data are any more reliable and accurate than the NEA data. Probably the best estimate of the true average salary in each state is an average of the NEA and BLS figures. NOTE: The NEA appropriately calculates the national average (gross salary before deductions but excluding supplemental salaries, extra-duty pay and fringe benefits) by weighting each state average by the number of its instructional staff members. The salaries of states with more teachers—like CA, TX, NY, FL and IL, with over 1.2 million (35.3%) of the nation’s 3.5 million instructional staff—contribute more to the national average than the salaries of states with few teachers—like SD, ND, AK, DE and WY with 37,052 (1.06%) instructional staff.
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Jerry Moore (Admin) Board Administrator Username: Admin Post Number: 11166 Registered: 01-2000 Rating: N/A |
Parsing the NEA’s Average Teacher Salaries PART 3. A consensus on what teachers should earn What you'll learn in this commentary:
Introduction In Part 1, I showed that NY's average teacher salary was $59,000, not the $55,181 reported by the NEA. In Part 2, I explored the nuances of the NEA's methods for calculating average teacher salaries aided by a comparison to data from the Bureau of Labor Statistics, and showed that the average salaries for IL, OR and KS were overstated. The adjusted average salaries for these states have been used in the following analysis. This lesson is the pay-off lesson. Here, we learn where average teacher salaries are higher or lower than predicted by using NEA data (adjusted for NY, IL, OR and KS). The assumption is simple. Each state has a "vote" on how much teachers should be paid, as reflected in its average teacher salary. This "vote" is cast in the context of the ability of the workers in each state to pay for education services, which is influenced by family income and the cost of living in each state. (Property taxes, total taxes and housing costs were statistically insignificant, which means they didn't change the predictions of average teacher salaries when included in the analysis). If we assume that the consensus view of how much teachers should make is the most reasonable view, then the only variation in teacher salaries should be based on the state's ability to pay teachers and the state's living costs. In other words, if every state economically values the worth of teachers the same relative to what other workers earn, then the only variation we should see in average teacher salaries should be related to the state's cost of living. Of course, the salaries that workers earn within the state are also influenced by the state's living costs, but they are not perfectly correlated. I use a linear regression model, with the adjusted NEA average teacher salary as the independent variable. Median family income and state cost of living indices are the dependent variables. From this model, I calculate a 95% confidence interval, which produces a salary range for each state that we can be 95% confident reflects what the true average teacher salary should be if the states accord equal economic value to the work of teachers. The model accounts for 58% of the observed variance in average teacher salaries, meaning that 42% of the difference in average teacher salaries is unexplained by median family income and the cost of living. The reasons for this are unknown. It may be that states differ in their assessments of how much teachers are worth, economically. As we look at the states, I'll mention some other reasons why the salaries are above or below expected values. The Big Picture  44% of the nation's teachers live in 23 states where the average teacher salary is within 1% of the predicted salary range. That result is largely a consequence of the model used and the assumptions made. Where average salaries vary and we assume the consensus view is the most reasonable, then some salaries will be above the expected value, some will be below, and most will be in the middle. The Rust Belt's High Salaries All five of the states with salaries more than 7% above expected levels border the Great Lakes. NY, PA, OH, MI and IL, along with IN (whose average teacher salary is 5.5% above the highest level expected) comprise an area known as the Rust Belt. Salaries may be higher in these states (relative to what other states pay) because these areas once had an economic base to support higher salaries, which set a higher level of salary expectations relative to other states. These states also have a strong union tradition, but that seems to matter far less than having had a strong economy to fund public services. In an analysis of average teacher salaries and the percentage of teachers belonging to the NEA, I found that union membership had no impact on average teacher salaries. In fact, the relationship was slightly negative, suggesting that the more "powerful" the union, the lower the salary earned by teachers. Since differences in union membership rates among the states don't account for differences in average teacher salaries, the best bet is that state economic health is the first and primary factor in high average teacher pay. And therein lies an extremely important message for teachers. The surest route to higher salaries is to promote economic development, not self-interests. When you think about it, that makes sense. If, by doing the essential and great work of educating children--"our future"--teachers lack the power to command higher salaries, then creating unions based on self-interest isn't going to matter much. In fact, it may alienate potential supporters. Only 8% of private sector workers are unionized, whereas 80% of teachers belong to unions. And these unions tell teachers they have lousy jobs with lousy pay, lousy work conditions and lousy benefits, essentially admitting that 35 years of union membership have accomplished nothing. The obvious fallacy of this analysis is that the economies of the Rust Belt states have been in relative decline over the past two decades, yet average teacher salaries are still higher than what other states pay based on economic ability and the cost of living. How can that be? Essentially, there's no way to adjust the salaries of public employees downward as economic health declines. Salaries that were high in the 1960s, when public employee unions began, have remained high because increases are primarily based on increases in the cost of living plus a little extra for doing "God's work." Nothing short of a crisis can change that. Michigan is currently in the midst of such a crisis. It is has the highest unemployment rate in the nation, the worst business tax and a poor ranking on business climate. It has lost thousands of high paying manufacturing jobs and its citizens have adjusted by taking lower paying jobs in other sectors. Educators seldom lose their jobs, and clearly prefer job cuts to pay cuts. (It's best for the kids). Consequently, their salaries are largely immune to downward pressures. Where most people are happy just to have a job--even at lower pay--having tenure means never having to worry about losing a job because of bad attitudes about salary. In fact, tenure encourages an attitude of wage dissatisfaction, which is used as political power to increase salaries because no parent wants students in classrooms with unhappy teachers who have the power and discretion to pass off Disney movies as academics. Everyone wants teachers who are motivated to deliver academic excellence. So, despite the job loses, pay cuts and a declining ability to support high public sector wages, the salaries of public sector workers tend to rise as if nothing has changed economically. The same story applies to NY, PA, IL and OH. Teacher salaries are highly resistant to downward adjustments, with isolated exceptions at the district level. See, e.g., Mentor teachers OK givebacks. (Links to other selected articles on teacher salaries can be found here). Before leaving the Rust Belt, I note that NY is one of the states for which I adjusted the average teacher salary from $55,181 to $59,000. The highest average teacher pay expected in NY based on median family income and the cost of living was $50,548. That's $4,633 less than the NEA's "average," which is actually the median salary. Even without the adjustment, NY's average is 9% higher than the highest expected value, which is large enough to put it into the category to which it has been placed. It's true, NY teachers need master's degrees, though there's no research that shows it does anything for students except reduce the amount of money available for expanding programs and services by providing a justification for paying teachers more. Although $1,000 more a year ought to cover the education and opportunity costs of obtaining a master's degree, NY probably adds more on average. Paying higher salaries for degrees that don't matter hardly justifies higher teacher salaries. Yet, when using NY's likely true average salary of $59,000, and reducing it by $1,500 to make it comparable with the bachelor degreed teachers in other states, NY's average teacher salary is still $6,952 (13.8%) above the highest expected salary. Finally, I note that the IL average teacher salary is 9.4% higher than the highest expected value even though I reduced the NEA average by $2,830 because the NEA data included extra-duty pay (which apparently was excluded from the data of other states) and because the derived average using BLS data was $48,460 rather than the $54,230 average reported by the NEA. Obviously, IL would still be in the top pay category had the NEA number been used rather than the adjusted number. The Low Salaries of the Great Plains and Rocky Mountain Regions Three of the 5 states with average teacher salaries more than 7% below the expected value are in the Great Plains--KS, ND and SD. KS is surrounded by states where the average teacher salary is 1 to 7% below the expected value. KS is also one of the states for which I adjusted the NEA's average salary of $38,623 to $36,315, a decrease of $2,308. Without this adjustment, KS would have fallen into the same category as the states surrounding it, with an average salary about 3% lower than the lowest expected value. As it stands, its average salary is about 9% lower than expected. The adjustment was made because the NEA data included supplemental salary and fringe benefits in addition to the base salary, which apparently wasn't the case for other states. On this basis, I substituted the BLS average, which may slightly understate the true average salary in KS. So, why do the Great Plains and Rocky Mountain states tend to have average teacher salaries below expected levels? Perhaps it's the inverse of the story for the high salaries of the Rust Belt. Historically, these states had a weaker union tradition with economies that weren't as robust during the 1960s, when teachers unions came into being. These states are also sparsely populated and it may be that the size of the teachers unions has never reached, and cannot reach, a critical mass sufficient to get a better deal relative to the other funding responsibilities in these states. In the same way in which tradition has kept salaries high in the Rust Belt, tradition may have kept teacher salaries relatively low in the the mountains and plains. It's not that these states haven't significantly increased education funding, but increases have typically gone into programs and services for students at a higher rate than in the Rust Belt. The practice of increasing salaries which start from behind at the rate of inflation, plus a little extra (though typically not as much extra as given to teachers in the Rust Belt), means average teacher salaries stay behind. It's not that teachers salaries haven't improved, but that improvements lag the rest of the country in dollar amounts. The Low Salaries of Upper New England ME, NH, and VT all have lower than expected average teacher salaries. I don't know why this is. I may have made a poor estimate of the cost of living in NH and ME because this number was not available for these states from my source. I estimated it from the Yahoo Real Estate website. I suspect that voters in these states have greater power in town meetings to fend off tax increases. I believe these states, along with MA (and perhaps other states and some cities) adopt their school budgets and their town budgets at the same time. Other states adopt school and local government budgets separately. It may be that considering them together restrains school spending increases more than in other places. There may also be a lack of warmth toward unions and collectivism in upper New England, in general. It seems to me that in the absence of dire work conditions and impoverished salaries, unionism works best in a culture of collectivism. Virgina VA is the only state outside the Great Plains, the Rocky Mountains and upper New England with lower than expected average teacher salaries. I suspect that VA's median family income has increased much faster than the raises given to teachers. The state is renowned for its fiscal conservatism. Moreover, its primary boarder states, WV and NC, have much lower family incomes and living costs, so VA is under no pressure to raise teacher salaries to compete with its neighbors. MD has higher incomes and living costs, but the state is too small to cause much of a drain on VA's teacher resources. The same is true for DE and Washington, D.C. So, it has the luxury of keeping teacher salaries a little lower (2.6%) than justified by its living costs and median family income. Hawaii Relative to median family income and state living costs, only ND teachers are worse off than teachers in HI. Their average salaries are 9.3% lower than the lowest one would expect. In fact, with median family incomes of $60,647 and a 156.9 cost of living index, one would expect HI teachers to be the highest paid in the nation. It ranks 17th (excluding D.C.) on the NEA report and next to last on the basis of this analysis. Why is that? It might be the lack of a strong union tradition combined with geographical isolation that minimizes the ability of states with higher salaries relative to living costs to attract teachers from Hawaii. It's somewhat humorous to note that the Hawaii State Teachers Association complains that it loses teachers to higher paying California, where teachers there say they're severely underpaid because they can't afford to buy a home. I guess one person's misery can be another person's aspiration. In 2004-05, most HA teachers received a 7% salary increase (Also, see here). This should be sufficient to bring HI average teacher salaries to within 7% of their lowest expected value. A Note on Alaska AK, like HI, is relatively isolated, yet its average teacher salary is within the range of expected values. However, AK teacher salaries have fallen from 1st place to 10th (excluding D.C.) in recent years. Its isolation may be a factor that has contributed to this. AK is unusual in that it receives billions of dollars in oil and gas royalties and taxes, a substantial amount of which is used to partially fund education. Essentially, consumers in every state help fund AK education through gasoline, diesel and fuel oil purchases. But for AK's revenue stream from oil fields, I suspect teachers there would be underpaid relative to living costs and median family income. However, the happy circumstance of oil wealth has not pushed AK teacher salaries into the category of highest paid teachers. Why is that? Like ME, NH, and VT, I suspect its a culture issue. More than any other state, Alaskans tend to be rugged individualists--perhaps out of necessity in many places--rather than collectivists. In this culture, I suspect it's difficult for teachers to make their salary arguments stick. But with the doubling of the price of oil, it may be that AK teachers will reclaim the top position in the salary rankings. Whatever the factors impacting on AK average teacher salaries, the state seems to be better able than most to control salaries as economic conditions change. A Note on Oregon OR and CA are the only states west of the Mississippi River that pay teachers more than the highest expected average salary, though CA's average is just 1.5% above this level. I reduced the NEA's $49,169 average teacher salary for OR to $46,850 because it included a 6% employer retirement contribution that wasn't included in the salary data for any other state. OR's average teacher salary derived from BLS data was only $44,502, so the downward adjustment seemed entirely within reason. In fact, the reduction may not have been large enough, which may account for OR's placement in the 1 to 7% category of states with high teacher salaries relative to family income and living costs. Excessive Spending How much do the states with higher than expected average teacher salaries spend that they wouldn't have to if they paid teachers on the same economic basis as derived from the consensus view? Here's a table with the data.
In addition to the salaries, these states pay billions more for pension benefits than they would if they paid teachers in line with the consensus view. Underspending States How much do the states with lower than expected average teacher salaries need to increase spending so average teacher salaries would reflect the consensus view? Here's a table with the data.
In addition, these states would incur higher pension costs in raising their average salaries. Summary observations and looking ahead How much teachers should be paid is a matter of contention--sometimes bitter. However, there is an implied consensus on the economic value of teaching in the United States. A few states pay their teachers a lot better than warranted by the derived consensus--an average of $4,238. A fair number of states--17 of them--underpay their teachers by an average of $2,235. If all teacher salaries were brought into line with the consensus view as it exists in practice, the total cost of education would fall by $4.7 billion, or 1%. One of the surprising findings of this analysis is that paying teachers fairly across the country doesn't require an increase in education spending. Of course, the five states primarily responsible for spending beyond expected levels aren't about to reduce teacher salaries--or even slow their growth. The proposed teacher contract in NYC raises salaries by an average of 15% over three years. And it's these states that the others chase after in a relentless pursuit of escalating wages and benefits for teachers. It's important to note that even in high wage states there are teachers who are underpaid. Similarly, in low wage states, some teachers are overpaid. This is a consequence of paying all teachers the same wage based on seniority and degrees earned. Fixing average salaries does nothing to fix this problem. In the next lesson, I'll provide the charts that show the average salary paid to teachers in each state, along with the range of expected salaries. I'll also provide the data used in this analysis.
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Jerry Moore (Admin) Board Administrator Username: Admin Post Number: 11244 Registered: 01-2000 Rating: N/A |
Parsing the NEA’s Average Teacher Salaries PART 4. Expected Average Teacher Salary by State What you'll learn in this commentary:
Introduction In Part 1, I showed that NY's average teacher salary was $59,000, not the $55,181 reported by the NEA. In Part 2, I explored the nuances of the NEA's methods for calculating average teacher salaries aided by a comparison to data from the Bureau of Labor Statistics, and showed that the average salaries for IL, OR and KS were overstated. In Part 3, we took a look at the big picture and discovered the regions of the country where average teacher salaries are above and below their expected levels. In this section, we'll look more closely at the specific findings for each state. The 25 Highest Paid States  The above graphic compares the adjusted NEA average teacher salary to the average salary range predicted based on median family income and state cost of living indices, in the context of how the states value the work of teachers based on average salaries. MI has the highest paid teachers in the country. That means its average teacher salary exceeds the highest expected salary by the greatest dollar amount. MI's average teacher salary is $54,412. The highest salary estimated by the model was $45,850. MI teachers earn $8,562 (18.7%) more per year than teachers in other states given its median family income and its cost of living. (The model does not adjust for differences in average teacher experience among the states or for differences in college degrees and other training that may explain some of the gap between predicted and actual average salary). Even though MI's salary ranks 5th (excluding D.C.) in the NEA data, it's not a fair comparison because it doesn't tell you how well off teachers are in the state compared to other workers and the cost of living. MI teachers may be expected, on average, to enjoy a higher standard of living during their working years, than the average enjoyed by teachers in all other states. (During retirement, the situation is not the same since some states provide better pension benefits than MI A full analysis of how well of teachers are in each state would use average teacher compensation, including all salaries, add-ons, benefits and pensions). NY has the second best average teacher pay. It's adjusted salary of $59,000 exceeds the highest expected average by $8,452 (16.7%)--almost as much as MI's. As shown in Part 3, this adds $638 per pupil to the cost of public education--the highest additional cost in the country on a per-pupil basis. It's equivalent to 5% of the total cost of education in NY. If NY's average teacher salary were at the highest expected level, NY would spend $1.83 billion less on education annually. I estimate that NY teachers earning more than $59,000 annually could be required to skip two years of cost of living increases without affecting the state's ability to compete for teachers. This would bring NY's average teacher salaries a little closer to its expected level based on an implied consensus of how much teachers should be paid. PA, IL, OH and IN average teacher salaries exceed the highest expected levels by $7,392 (16.6%), $4,402 (9.4%), $3,650 (8.3%) and $2,386 (5.5%), respectively. As noted in Part 3, these states, along with MI and NY, are the Rust Belt states. Their economies have been under stress for some time but this hasn't caused their average teacher salaries to decline, to date. The average teacher salaries of GA, OR, NC and CA exceed the highest expected value by $2,966 (6.9%), $2,271 (5.1%), $1,446 (3.5%) and $849 (1.5%), respectively. From RI through NJ, the state's average teacher salary is within the expected salary range or exceeds it by less than 0.5% (in the cases of RI, CT, AR and KY). It's interesting to note that 40th-NEA-ranked WV, with an average salary of $38,461, actually does quite well in this analysis, ranking 15th. WV is one state where claims of excessively low teacher salaries are repeatedly made. Its better than average showing is probably related to the higher salaries earned by teachers in the border states of PA, OH, MD, VA and KY. WV may feel greater pressure than most states to give its teachers a slightly better-than-averge deal than warranted by its cost of living and median family income. Conversely, the state's low salaries may reduce the pressure of its border states to increase teacher salaries, particularly VA. NJ, which ranks 3rd in average teacher pay at $55,592, pays its teachers exactly the amount predicted by the model. The 25 Lowest Paid States  From AL to MD, the state's average teacher salary is within the expected salary. From CO through NE, the average is lower than expected, rising from a deficiency of $725 (1.6%) to $1,308 (3.5%). In these states, adding $100 or less to per-pupil spending would bring teacher salaries to within the expected level. In ME, VT and NH, upper New England states, the deficiency is $1,991 (4.8%), $2,315 (5.2%) and $4,186 (8.9%), requiring an additional $174, $204 and $305 in spending per pupil, respectively, to correct the deficiency. Average teacher salaries in WY, ND, KS and SD are below the expected levels by $2,436 (5.8%), $3,333 (8.6%), $3,516 (8.8%) and $5,405 (14%), respectively. Correcting these deficiencies would add $183, $262, $244 and $398 in per-pupil spending, respectively. SD's average teacher pay of $33,236 ranks last in both the NEA salary survey and in this analysis using the cost of living index and median family income. Its teachers likely deserve a substantial increase in pay. Finally, HI's average teacher salary is $4,679 (9.3%) below the lowest expected value. However, as noted in Part 3, HI's teachers recently received a substantial increase in pay which should substantially improve its ranking in the future. Data Here's the data used in the model and in making various calculations:
Sources NEA Average Teacher Salary: Rankings & Estimates: Rankings of the States 2004 and Estimates of School Statistics 2005 Bureau of Labor Statistics Teacher Salaries: May 2004 State Occupational Employment and Wage Estimates Cost of Living Index: Missouri Economic Research and Information Center: 1st Quarter 2005. The cost of living indices for NH, ME and DE were estimated from Yahoo Real Estate cost of living data. Median Family Income: U.S. Census Bureau American Community Survey: Multi-Year Profiles 2003, Table 3 Number of Teachers and Enrollment: National Center for Education Statistics: Build a Table, School Year 2003-04 State Population 2004: U.S. Census Bureau State & County QuickFacts Statistical Data
** Correlation is significant at the 0.01 level (2-tailed). Model Summary
a. Predictors: (Constant), 2003 Median Family Income, Cost of Living Index 2005 ANOVAb
a. Predictors: (Constant), 2003 Median Family Income, Cost of Living Index 2005 b. Dependent Variable: NEA Adjusted Average Teacher Salary Coefficientsa
a. Dependent Variable: NEA Adjusted Average Teacher Salary
|
