1 / 41

Teacher Compensation

Teacher Compensation. Michael Podgursky Department of Economics University of Missouri – Columbia NCSL Conference Phoenix, AZ Dec. 1-2, 2007 Co-investigator, CALDER, NCPI. Teacher Quality/Compensation Qauntity-Quality Tradeoff. Student Enrollment, Teacher and Non-Teacher Employment

cahil
Download Presentation

Teacher Compensation

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Teacher Compensation Michael Podgursky Department of Economics University of Missouri – Columbia NCSL Conference Phoenix, AZ Dec. 1-2, 2007 Co-investigator, CALDER, NCPI

  2. Teacher Quality/CompensationQauntity-Quality Tradeoff

  3. Student Enrollment, Teacher and Non-Teacher Employment In Public Schools: 1980 - 2003 3.049m Public School Teachers Fall, 2003

  4. Falling Student-Teacher RatiosU.S. and Missouri, 1987-2004

  5. Teacher Compensation • Salary and Benefits account for roughly 90 percent of K-12 instructional costs • Data Quality Issues (NCES plans) • Single Salary Schedule • Retiree Benefits

  6. Teacher Compensation • Single Salary Schedule • Compensation Policy Affects the Behavior and Composition of the Workforce • “You can’t repeal the law of supply and demand” • Rigidities by • Teaching field (esp. math, science, special ed) • School Conditions • Quality of Effort

  7. San Diego School District: 2006-07 Salary Schedule

  8. Difficulty in Filling Vacancies by Teaching Field • Varies considerably by field • Generally somewhat easier in 2003-04 than 1999-00 • NCES Schools and Staffing Surveys, 1999-00 and 2003-04

  9. Source: Schools and Staffing Surveys, 1999-00, 2003-04

  10. Staffing Difficulties in Low (<25%) and High (>75%) Poverty Schools: Elementary Ed 2003-04 Source: Schools and Staffing Surveys 2003-04

  11. Source: Schools and Staffing Surveys, 1999-00, 2003-04

  12. Source: Schools and Staffing Surveys, 1999-00, 2003-04

  13. Source: Schools and Staffing Surveys, 1999-00, 2003-04

  14. Source: Schools and Staffing Surveys, 1999-00, 2003-04

  15. Source: Schools and Staffing Surveys, 1999-00, 2003-04

  16. Source: Schools and Staffing Surveys, 1999-00, 2003-04

  17. Potential supply Current supply New Hires

  18. Consequences of Salary Schedules • School Conditions • School with highest percentage of poor children likely to have least experienced teachers • Quality of Performance • Performance-based pay • School-wide or individual • Role of test scores • Size of bonuses • Encourage Districts to Experiment • Federal Teacher Incentive Fund (TIF) Grants • NCPI Vanderbilt – IES funded experiment • Implement in a way that permits evaluation (pilots)

  19. Types of Incentives: Teacher Weights “Does the district currently use any pay incentives such as cash bonuses, a salary increase, or different steps on a salary schedule to reward …”

  20. Incentives by Teaching Field

  21. Total Compensation = Current + Deferred Compensation

  22. Teacher Pensions: Some Stylized Facts • Mostly state-wide systems • Roughly 70 percent of teachers are in Social Security. Generally state decision. • Nearly all teachers are in Defined Benefit plans. DC and CB options very limited • Mean retirement age is well below Social Security and Medicare ages • 58 years (retired and stopped teaching, SASS TFS) • Very Expensive • Many are under funded

  23. Incentives in Teacher Pension Systems • In public sector DB pension systems accrual of pension wealth is highly non-linear and back-loaded • State systems generally have sharp “spikes” in accrual rates • Pull teachers to spike • Push out after • Not inherent in DB pension systems. • “cash balance” (IBM and other firms) • Can smooth spikes

  24. Typical DB teacher pension Annual Pension = S x FAS x r(S,A) S = service years FAS = final average salary r(S,A) = replacement factor

  25. Lots of moving parts…

  26. Incentives for Work and Retirement • Compute pension wealth at each year of work life • Compute growth of pension wealth from an addition year of work • Representative teacher • Enters at 25, continuous spell of work • Standard assumptions concerning PV of pension wealth. (see Costrell and Podgursky (2007) )

  27. Increment to PV of Pension Wealth from Working an Additional Year: Missouri

  28. Source: Costrell and Podgursky (2007)

  29. Source: Costrell and Podgursky (2007)

  30. Source: Costrell and Podgursky (2007)

  31. Ohio

  32. Do these spikes affect teacher behavior? • Yes

  33. Increment to PV of Pension Wealth from Working an Additional Year: Missouri r = 2.5% S ≤ 30 r = 2.55% S ≥ 31 Changed in July 2001

  34. Unintended Consequences of Early Retirements • Retiree Health Insurance (OPEB)

  35. Other Post-Employment Benefits (OPEB) • Retiree Health Insurance • Largely Unfunded • Estimates of Liabilities Required Under New Accounting Rules • GASB 43, 45 • Initial Estimates of UAL Very Large • LAUSD - $10b

  36. 2006 GASB 45 Estimates, LAUSD http://notebook.lausd.net/pls/ptl/docs/PAGE/CA_LAUSD/FLDR_ORGANIZATIONS/COMMITTEE_MAIN/ABT_HOME/ABT_AGENDA/ITEM %203%20-%20HWACTUARIAL.PDF

  37. Unintended Consequences of Early Retirements • Retiree Health Insurance (OPEB) • Reemployment of Teachers/ Administrators (“double-dipping”)

More Related