[COLUMN] No Surprise Here: Study Shows Teachers Overpaid

While it will come as no surprise to those who actually pay attention, a new study shows that government teachers are dramatically overpaid, deflating a myth long perpetuated by the American Federation of Teachers and other teachers unions.

The Nov. 1 study, “Assessing the Compensation of Public-School Teachers” by Drs. Jason Richwine and Andrew G. Biggs, shows that government teachers, on average, earn 52 percent more than comparable private employees. This amounts to the government overcharging taxpayers about $120 billion each year at a time when state budget deficits, according to a June study by The Center on Budget and Policy Priorities, are about $103 billion.

No one is opposed to teachers receiving a fair salary; however, if a teacher’s skills are worth $X in the free market, why should the government pay 52 percent more than that? This occurs because teacher pay, thanks to union strong-arm tactics and weak-kneed school officials, is often based on how much the government can afford to pay at the present time instead of on how much teachers actually should be paid.

To demonstrate this point, the study shows that government teachers who leave the profession often see a wage decrease of about 3 percent while workers who leave their professions to become teachers see a wage increase of about 9 percent. If teachers were underpaid, the opposite would be true. Government teachers also earn almost 10 percent more in wages than equally qualified private-school teachers.

While teachers enjoy comparable or slightly higher wages than the private sector, where teachers really rake in the dough is in their benefit packages, as evidenced by their unreasonable and militant opposition to pension and health care reform in states such as Ohio, Wisconsin, New Jersey and Florida. Teacher benefits are, on average, 40 percent more generous than those for comparable private-sector workers.

For example, let’s consider pension plans.

Most private-sector workers have a defined-contribution plan, usually a 401(k) or a 403(b), where there is no set level of payout in retirement.

Most government teachers, indeed, government workers in general, have a defined-benefit plan, where they will receive a guaranteed fixed payment after retirement for life.

While the private-sector employee is at the whim of the markets, the public-sector employee has a guaranteed pension with the risk borne by the private-sector employees who actually fund the pension systems, including bailing them out when the expected investment returns do not materialize.

On average, the government teacher sees a retirement income 4.5 times higher than a comparable private-sector worker. For example, according to the 2010 Comprehensive Annual Financial Report in Illinois, the average benefit paid in that state to a 60-year-old retired teacher with 35 to 39 years of service was $67,452 a year, a nice chunk of change for a retirement income.

Additionally, teachers and other government workers are not saddled with Social Security, which pays workers a below-market rate of return on their “investments.”

Other areas that enrich schoolteachers include generous retiree health care plans, better job security and more paid leave (teachers enjoy a lot of time off, including summer, Christmas, and spring breaks, none of which “count” as vacation time.)

Government teachers often point to their advanced degrees as a reason for the higher pay (while at the same time claiming they are underpaid).

However, credential inflation is rampant in the education field.

In his book, “Inside American Education,” Dr. Thomas Sowell reported that in 1980-81 students majoring in education scored lower on both the verbal and math portions of the SAT than students majoring in any other subject. Even before that, The Journal of Higher Education reported in 1960 on the problem of low grading standards in education departments.

More recent data suggest the trend has not changed. Studies show that education majors “earn” higher grades than other students because education classes are easier than other classes with stricter grading. An education degree is one of the easiest degrees to earn, if not the easiest.

Also, studies show that while teachers score above the national average on intelligence tests, they score below the average for other college graduates.

It would seem these advanced degrees do more for teacher salaries than student proficiency.

School salary schedules reward phony advanced degrees and “butt in seat” time instead of excellence and merit, thanks to teachers unions that care more about power than children. Or as Albert Shanker, the late, iconic head of the United Federation of Teachers, once pointedly put it, “When schoolchildren start paying union dues, that’s when I’ll start representing the interests of schoolchildren.”

Given this data, it is laughable that President Barack Obama demanded $30 billion this year to “save teacher jobs” and increase teacher pay.

The root of the problem, really, is government control over education. The time is long past for the separation of school and state. Given even the least bit of thought, it is obvious how anathema it is to a free society to turn our children over to the government for education.

Additionally, the stranglehold the teachers unions have on the process has led us to this untenable fiscal situation where out-of-control teacher wages and benefits are driving up the cost of providing mediocre education.

What this study clearly shows is that government teacher compensation could, and should, be reduced with little effect on retention or recruitment while giving a big boost to communities facing budget deficits. A win-win.

Cross posted at Think Free.

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