What Do We Know About Public Teacher Compensation?

Whether public employees are over- or under-paid relative to their private sector counterparts is a source of lively debate. Much of the research on the relative compensation of public and private workers has focused on teachers – the largest segment of the public workforce. Moreover, the issue of teacher compensation has gained currency since the Great Recession, as states and school districts have frequently faced tough budget decisions to cut benefits or halt pay raises. Teacher compensation has important implications for hiring and retaining high-quality teachers and, consequently, for student academic performance. This brief highlights the range of conclusions by researchers who have assessed teacher compensation and attempts to inform the debate through a comprehensive analysis of compensation. The discussion proceeds as follows. The first section explains the difficulties associated with assessing public teacher compensation. The second section highlights the range of conclusions by researchers to date. The third section attempts to shed new light on this topic by more accurately measuring the cost of retirement benefits, carefully accounting for health and retirement plan coverage, and including all other benefits such as Social Security, supplemental pay, and paid leave. The fourth section briefly discusses the implications of teacher compensation on student outcomes. The final section concludes that public teachers earn roughly the same as similar private sector workers but this equality may turn to a deficit over time as new teachers receive lower retirement benefits.