What industry has seen pay fall below average in the most states? Public schools.
In a search for jobs which once paid well, but have fallen below average in most states, we considered hundreds of industries. Public schools stood out.
In the early 1990s, when today’s veteran educators were starting out, public-school teachers and support staff pulled in above-average paychecks in 26 of the 42 states for which the Labor Department had comparable data.
By 2017, their earnings topped the average in just one state, Rhode Island. Over that time, public-school teacher and staff earnings fell relative to the average worker in all 42 of those states.
The biggest relative drop came in Wisconsin. In the early nineties, Wisconsin public-school teachers and staff earned about 1.2 times average workers’ pay. In recent years, that number has fallen to about nine tenths of the statewide average. The smallest drops came in Alabama, West Virginia and Mississippi. In those states, teacher pay was already below average.
The only other comparable industries in terms of employment and salaries to see similar pay slides include delivery drivers, printers, electronics retailers and warehouse workers — industries which were reshaped by the rise of the internet.
Teachers make up about half of the public-school workforce nationwide. Schools employ more aides and special-education teachers now than in the early ’90s, but fewer secretaries and janitorial workers, Census Bureau data show.
Many analyses show their pay has fallen in relative terms. In a comprehensive evaluation of Labor Department data from the Economic Policy Institute, economists Sylvia Allegretto and Lawrence Mishel found “the mid-1990s marks the start of a period of sharply eroding teacher pay and an escalating teacher pay penalty.”
Women teachers once earned more than similar workers in other industries, but as of 2017 they earn 15.6 percent less. Male teachers took an even bigger hit (because men tend to earn more), earning 26.8 percent less than comparable workers.
While teachers enjoy a 7.6 percent advantage in benefits, that does not compensate for their 18.7 percent disadvantage in wages, the researchers found.
Why aren’t schools paying teachers? Because their budgets are being squeezed at every level.
Nearly half of school funding, 47 percent, comes from state governments, according to the Center for Budget and Policy Priorities. Many states slashed their education budgets during the Great Recession, and as of 2016, 24 were still providing less total school funding per student than in 2008, according to CBPP’s analysis of Census Bureau data. Some states have since cut taxes and trimmed budgets again in an attempt to spur growth.
“Most of the states with the deepest cuts in school funding in the last decade are states that cut taxes, leaving them with less revenue for paying teachers and covering other necessary school costs,” said CBPP state-budget expert Michael Leachman.
In addition to budget cuts, state spending on education is being squeezed by the rising costs of health care and prisons – programs funded in part by state budgets. In 2014, Leachman noted that corrections had risen to become the third-highest category of state spending, behind only education and health care.
Public schools are also getting squeezed by falling or flat home values in some states. Public schools get about 45 percent of their funding from local governments. Much of that vanished during the Recession, as property taxes plunged. When adjusted for inflation, home values in much of the country have yet to recover.
The remainder comes from the federal government’s discretionary budget, a category which remains low relative to the size of the economy in historical terms.
The widespread drop in relative pay also reflects a change in teachers’ status. Teaching used to be the primary option for the most-qualified women, in particular.
“In 1970, about half of all college educated employed women worked as teachers. Today, it’s less than 10 percent” according to Census data, said Montana State University’s Christiana Stoddard, who has spent over a decade measuring teachers’ relative incomes and performance.
Today, the highest-skilled women have many options outside of teaching. As the workforce becomes more educated, pay has risen in many other industries and left public education behind.
“What a teacher does hasn’t changed much over time, but what skilled occupations do and what they can command has. As markets have gotten global, there’s been an increase in the return to skills and the return to education,” Stoddard said. “It’s hard for teachers to compete with that.”
“That’s the dominant reason why teacher pay has declined relative to other occupations,” Stoddard said.
To find which industries had slipped from the ranks of “good jobs” in the widest swath of the country, we needed we turned to the Quarterly Census of Employment and Wages. The QCEW, while precise, suppresses data for some quarters to protect the privacy of the companies it measures. To reduce volatility and limit missing data, we calculated annual ratios of industry pay compared to state averages and averaged them over three-year periods. We only included industries (at the four-digit NAICS level) with at least four quarters worth of data during each time period, and which paid above average in at least 15 states in the 1990-1992 period. For each industry, the QCEW separates private, federal, state and local workers, which enabled us to distinguish between private-sector workers and their local, state and federal government counterparts. A separate analysis of Census Bureau data reached a similar conclusion about public-school employment.