Are teachers overpaid?

Chris Tessone / November 1, 2011

In a new AEI/Heritage paper that is sure to create some buzz, Andrew Biggs and Jason Richwine say yes, teachers are overpaid relative to similar workers based on several different metrics. The most interesting result in the paper for me was this table, illustrating that teachers take a pay cut of roughly 3% when they leave the profession, while new entrants actually see a raise of almost 9% compared to their previous non-teaching job:

As the authors point out, this result is not consistent with teachers being "desperately underpaid," in Education Secretary Arne Duncan's words.

We need to take the conversation on teacher pay beyond averages, however. As we and others have noted before, younger teachers are under-compensated for the dramatic increases in effectiveness they realize in their first few years of teaching. We also ignore the alternatives certain teachers have in the labor market, paying PE teachers (who have few job options in the private sector) much more than physics and math teachers.

If we want to spend every education dollar effectively, we have to move beyond one-size-fits-all strategies and focus on each individual teacher's capabilities and effectiveness in driving student learning. This new AEI paper is worth checking out and brings valuable data to the table.

? Chris Tessone

» Continued

Are teachers overpaid?

Jerry Brown, pension reformer?

Chris Tessone / October 27, 2011

California's Jerry Brown is getting ready to propose what the AP calls "sweeping rollbacks" in public-sector pensions, raising the retirement age for non-public safety employees to 67, ending abuses like spiking and "air time," and mandating a hybrid system that has a traditional pension component and an added 401(k)-style defined-contribution plan.

Based on the Sacramento Bee's description of the plan, the change to a hybrid plan is far less radical than it needs to be to improve mobility of benefits for young workers (teachers included). The new system would still provide 2/3 of projected retirement income out of a defined-benefit plan workers would only earn after a full, multi-decade career in public service. It's also hard not to wonder how deeply Gov. Brown believes in this plan, since he pitched a much less serious reform in the spring that failed due to Republican opposition.

It's a better start to the reform process in California than that earlier plan, however. If Brown sticks to his guns against his union backers and gets these reforms through the legislature, it would be a positive first step in fixing the state's broken system of public employee compensation. Our latest report, Halting a Runaway Train: Reforming Teacher Pensions for the 21st Century, provides a case study of how the federal government enacted similar reforms in the 1980s. Check it out, Jerry!

? Chris Tessone

» Continued

Jerry Brown, pension reformer?

Traditional pensions: cui bono?

Chris Tessone / October 12, 2011

Younger teachers in Illinois, whose pensions were slashed last year by the legislature, should start asking whose benefits they're really paying for. The new Tier 2 pension only costs about 5 percent of salary...yet teachers are paying 9.4% of their salaries into the Teacher Retirement System. This takes the usual shell game of wealth transfers from younger and more mobile teachers to retirees to a whole new level: theft.

My hometown newspaper, the Southern Illinoisan, is running a story that explains who benefits the most richly from the old Tier 1 pension: union functionaries who stopped teaching decades before retirement but still receive a state-funded pension:

Then there is Kenneth Drum. TRS pays Drum more than $160,000 a year, despite Drum only working for 12 years as a teacher.

Drum's large pension comes not from his time in the classroom, but rather because of a 20-year career at IFT. Drum has collected more than $2 million from TRS since retiring in 1994, and is one of 21 former NEA, IEA, IFT or IASB employees who has collected more than $1 million from the TRS since retiring.

Comerford said he couldn't speak for individuals as to why they didn't take an IFT pension when they went to work for the union instead of continuing paying into a public system.