Aug 092008

While eating lunch downtown the other day I was partaking in one of my favorite activities: eavesdropping. It’s amazing what you can learn by listening to the other conversations around you in a public place. I feel it’s also a great way to keep an ear on what topics my neighbors are actually interested in.

With school starting again later this month it was no surprise that one of the topics of conversation was the traditional moaning and gnashing of teeth over “how poorly” our teachers are paid.  I’ve long felt the underpaid teacher to be a mythical creature whose existence is only accepted due to the excellent propaganda machine of the NEA and teachers’ unions, but I thought maybe it was time I investigated myself.  Which I now have…

The Disclaimers-

  • This article is focused on teachers in government schools, not private schools.
  • Although all numbers (unless stated otherwise) deal with teachers in the Morgan Hill Unified School District, a quick spot check of several other California counties showed similar results across the board.
  • Throughout this article I refer to teachers as women rather than men.  I do this not because I’m a sexist pig, but because every school I’ve visited over the last 30 years has had a significant majority of the teaching staff comprised of women.
  • Unfortunately I had to return to 1999-2000 to get numbers for comparison.  However, teacher salaries have increased at a rate slightly higher than inflation since then, so the numbers should still hold.  If anyone knows where I can get documented salary stats for a more recent year I’ll be more than happy to revisit this topic.

The Basics-

  • Lowest Teacher Salary Offered1 – $33,360
  • Highest Teacher Salary Offered1 – $60,499
  • Average Teacher Salary Paid1 – $50,757
  • Median Income (Single Female)2 – $45,354
  • Mean Income (Single Female)2 -$54,012
  • Median Household Income2 – $81,958
  • Mean Household Income2 – $101,868
  • Female Population Making <$50,000/year2 – 58%

Based on these numbers it appears that the average school teacher tends to fall right in line with the average non-teacher in Morgan Hill.  Is this really so bad?  But that’s only the start of the story.

Apples To Apples-

Teachers had 184 work days in 1999-20001, while the average worker had 250 (5 days/week, 50 weeks/year), which means teachers worked 26% less than the average worker.  So it seems only fair to add another 26% to the average teacher salary when making comparisons, does it not?  This brings the average teacher salary in Morgan Hill to $63,954.  This is higher than 63% of the single females in Morgan Hill earned that year2.  Not bad at all.  And that’s still not the end of the story.

Retirement Benefits-

The thing that most people tend to forget about teacher compensation (in government schools) is the excellent retirement benefit.  How many private sector jobs even have a retirement fund anymore?  I know I’ve never had one.  I’m not talking about a 401k, IRA, or similar self-funded retirement plan.  I’m talking about a full pension.  Teacher pensions are handled by CalSTRS (California State Teachers’ Retirement System) which brags that it is the “Largest U.S. teachers’ retirement fund” and the “Second largest U.S. public pension fund”3 Teachers can retire as early as age 50 with at least 30 years of service credit, or at age 55 with at least five years of service credit.

The methods for calculating retirement benefits are far too complicated to repeat here, but can be seen at the CalSTRS website. Instead, let’s take a current average teacher and see what her lifetime retirement benefits will be by using the handy calculator provided by CalSTRS4.  Our average teacher above had been teaching for 17 years1, so we’ll use her as an example.

Assuming she started teaching at 21 she would have been born in 1957, and thus would be of minimum retirement age in 2012 at age 51 with 30 years of service, 1 year of Other Service Credit, 14 unused sick days, 184 contract base service days, 2 Year Service Credit Incentive, a final salary of $79,907 (the current highest salary offered in Morgan Hill), and no beneficiary.  Her estimated unmodified monthly benefit will be $3524.01, making an annual salary of $42,288 or, roughly, 53% of her final salary. Not to mention that at 51 she’s still quite able to work and this won’t effect her pension at all as long as she doesn’t work for a California government school.

Compare this to the standard Social Security benefit for the same woman working in the  private sector – $1,357/month or $16,284/year (according to the Social Security Administration6).  And in the private sector she wouldn’t be able to start collecting until age 62, more than a decade later.

Given a standard life expectancy our teacher should live to be 835, so will be collecting her pension for 32 years. That’s two years longer than she actually worked as a teacher.  Therefore it seems reasonable to add her annual pension to her annual average salary (adjusted for year-round employment) and compare that to the median salary in Morgan Hill with their Social Security benefit added on.  Doing so gives us the following numbers-

  • Average Teacher Salary Paid – $106,242
  • Median Income (Single Female) – $61,638

That tells us that the average government school teacher is earning 42% more than the average woman in Morgan Hill.  Do you still think they’re “woefully underpaid”?  Well, a 2007 report from the Manhattan Institute For Policy Research7 (based on data collected by the U.S. Bureau of Labor Statistics (BLS) in its annual National Compensation Survey) agrees with me-

  • The average public school teacher was paid 36% more per hour than the average non-sales white-collar worker and 11% more than the average professional specialty and technical worker.
  • Full-time public school teachers work on average 36.5 hours per week during weeks that they are working. By comparison, white-collar workers (excluding sales) work 39.4 hours, and professional specialty and technical workers work 39.0 hours per week. Private school teachers work 38.3 hours per week.
  • Compared with public school teachers, editors and reporters earn 24% less; architects, 11% less; psychologists, 9% less; chemists, 5% less; mechanical engineers, 6% less; and economists, 1% less.
  • Compared with public school teachers, airplane pilots earn 186% more; physicians, 80% more; lawyers, 49% more; nuclear engineers, 17% more; actuaries, 9% more; and physicists, 3% more.
  • Public school teachers are paid 61% more per hour than private school teachers, on average nationwide.
  • We find no evidence that average teacher pay relative to that of other white-collar or professional specialty workers is related to high school graduation rates in the metropolitan area.

Data Sources-

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