Present and Future Trends of the Supply of Academic Excellence in PUSD

1. Present and Future Trends of the Supply of Academic Excellence in PUSD

2. Purpose • To objectively look at what the Laws of Economics, and particularly the Law of Supply, says about human behavior and the willingness to be a supplier of a good or service. • This presentation will attempt to show how the supply curve of academic excellence through instruction is changing in PUSD and explain why it is changing based purely on the Economic Law of Supply. • To offer broad based solutions to a critical problem, the decreasing supply of Academic Excellence in PUSD.

3. 7 Factors That Affect the Supplyof Educators • The following 7 determinants of supply all cause supply to either increase or decrease. 1) Cost of Inputs 2) Number of Suppliers 3) Technology

4. 7 Factors That Affect the Supplyof Educators 4) Taxes 5) Regulations 6) Future Expectations 7) Productivity

5. Who are the Suppliers? • In this presentation the suppliers are Teachers in PUSD. • The Law of Supply states that as the price for the supply increases, more will be supplied. As the price for the supply decreases, fewer suppliers are willing to supply. In other words, there is a direct relationship between supply and the price that is paid for the supply.

6. Cost of Inputs • Supply and suppliers behave rationally. As costs rise for suppliers, they are willing to supply less. Resulting in a shift of the supply curve to the left. (Decrease in Supply) and visa versa. • The “cost” of being an educator has risen dramatically in the past 6 years due to factors such as increases to ASRS and heath care, frozen pay, cuts to Career Ladders, and decreases in 301 revenues through most of the past 6 years. • Also, college tuition has risen dramatically, making it much more difficult to become a teacher due to this direct “Cost” of becoming a teacher.

7. Cost of Inputs 100% PUSD Funding A 0%/F PUSD Academic Excellence

8. Number of Suppliers • Within the Law of Supply, the more the number of suppliers, the more the supply. Again, behaving rationally. Visa Versa, the opposite reaction occurs. • The number of teachers in the market place is diminishing not increasing. This causes an ever decreasing supply of teachers as evidenced by positions remaining unfilled in PUSD and it is now October.

9. # of Sellers 100% PUSD Funding A 0%/F PUSD Academic Excellence

10. Technology • The Law of Supply states that increases in the use and efficiency of Technology has a long term affect shifting the supply to the right. (Increase) • However, in the short run, new technology creates a learning curve effect, which causes a shift to the left. (See Pinnacle in year 1) • Passing the PUSD bond should result in an supply shift to the right, however, in the short runexpectation there will be a shift to the left (learning curve and implementation challenges tied to the new infrastructure.

11. Technology 100% PUSD Funding A 0%/F PUSD Academic Excellence

12. TAXES • The Law of Supply states that increasing taxes will cause a decrease in supply. Again, the visa versa results in the opposite effect. • Taxes • ASRS- although technically not a tax in the purest sense, still a mandatory increase that decreases net pay. (In 1992, ASRS contribution was 3%) Today, it is now over 11%. (Shift Left) • Payroll tax holiday expired in January. An increase in federal taxes of 1.5% on paychecks. (Shift Left)

13. Taxes 100% PUSD Funding A 0%/F PUSD Academic Excellence

14. Regulations • The Law of Supply states that increased regulations results in a decrease in supply. Fewer regulations results in an increase in supply. • Common Core implementation, the new evaluation system, the lingering concept of performance pay, etc., behave the same way as regulations to the supply of teaching. • The more that is introduced, the more the supply curve shifts to the left.

15. Regulations 100% PUSD Funding A 0%/F PUSD Academic Excellence

16. Future Expectations • The Law of Supply states that if future market expectations are diminished, supply will decrease. (Shift Left) Again, if the opposite is occurring, a shift right would be expected. • The expectations for the future for Arizona’s public educators has been diminishing for the past 6 years for many reasons including massive cuts to public education, the “new norm”, potential revenues switched from public to private education, increasing college tuition, and a pervasive belief that teachers are failing as a profession. • If the expectation is that these conditions will only get worse unless the trend radically changes, the supply curve will shift to the left. (Decrease)

17. Future Expectations 100% PUSD Funding 0%/F A PUSD Academic Excellence

18. Productivity • The Law of Supply states that as the employee (labor) feels empowered by increasing wages, benefits, improved working conditions, etc., supply will shift right. (Increase) However, if the opposite conditions exists, a shift to the left will occur. • Teacher Wages: For some in this district, (Career Ladder Teachers), the loss in net pay over the last 6 years has been over 29%!! (Shift Left) • Loss of net pay from increases to ASRS, decreases in 301, the stagnation and decline of base pay, increases to benefit premiums, inflation and the loss of Career Ladders! • Teachers who came in 2007 or later, have had a decrease to their net pay in 6 years. If they have a child, they are living in poverty as a teacher. (Shift Left)

19. Productivity Continued • Working Conditions.---MORALE COUNTS IN ECONOMICS! • No protected prep times or lunches. (Shift Left) • Creating curriculum for common core during the school year for no pay. (Shift Left) • More demands due to evaluation system as well as common core requirements. (Shift Left)

20. Productivity Continued • Working Conditions.---MORALE COUNTS IN ECONOMICS! • Assessments, assessments, assessments. (Shift Left) • Unpaid duties. (Shift Left) • Unpaid sub rotations. (Shift Left) • Due to the loss in income over 6 years, many have second jobs. (Shift Left) • Paying new teachers more than PUSD veterans, even if perception, 1 actual example makes it a reality. (Shift Left)

21. Productivity 100% PUSD Funding A 0%/F PUSD Academic Excellence

22. Solutions • The fact is simple. The Supply Curve for academic excellence is shifting to the left and unless immediately addressed, will shift further left at a more rapid rate as these conditions become more severe. • What can be done?

23. Solutions • WAGES: We’ve had a balanced budget for the past 6 years because of cuts and increasing workloads for everyone. For the the first time since 2007, we have the possibility of a surplus due the inflationary lawsuit victory as well as retiree savings, This money must be used to address the supply curve of academic excellence not for projects, discretionary spending, or anything else not directly related to shifting the supply curve of academic excellence to the right. Many will be wanting “their piece of this money”, but the “teachers of PUSD” hope this presentation has clearly outlined the priorities of how that surplus should be spent.

24. Solutions • Working Conditions: A message needs to be sent to teachers that they are respected as professionals by improving their working conditions. It can start as simply and as rational as protecting a defined prep hour and teacher lunches on a daily basis. As pointed out when supply is related to productivity, the morale is everything when trying to increase academic excellence in PUSD. • This would cost very little in the big scheme of increasing productivity and shifting the supply curve to the RIGHT!

25. Thank you! • Thank you for your time this evening and for your service to the students, employees and community of Peoria USD. • We are anxious to work with you to support our schools and the achievement of our students! Sincerely: Mark Moffatt Peoria Education Association