After announcing last month that it would cut more than 150 administrative positions from its administrative staff, Denver Public Schools (DPS) has begun the process. The cuts will direct $17 million toward raising pay for district employees and teachers — who went on strike in February to demand higher salaries — and additional funds will go to special education services. Many blame inflated district administrations for suppressing teachers’ pay. Some critics say there aren’t too many administrators, and that these figures don’t make up a significant percentage of employees in public school districts. Additionally, others argue there are reasons for any growth in number of administrators. For one thing, if it wasn’t for these staff members, the tasks they complete would fall on the shoulders of faculty members.
The L.A. teacher strike may be over, but observers warn there’s no ‘clear path forward’ for how the school district can afford its new contract
The L.A. Unified school board has approved a contract with its teachers union that officials admit they can’t fully afford, calling the deal’s sustainability into question as the district receives repeated warnings from the county that it’s in severe financial straits. To shoulder about $840 million in added costs through 2021, district officials say they’re largely relying on more state funding and a 2020 California tax referendum — neither of which are guaranteed. District board members could also float a parcel tax, though it’s been unpopular in the past. Short-term fixes so far include cuts to the central office and the reassignment of some funds within the budget, a spokeswoman said via email.
Governors in recent years have been pouring money into school districts budgets, yet teachers’ pay has, for the most part, not budged. Driven in part by salary issues, teachers in Los Angeles went on strike, and teachers in Denver decided Wednesday to go on strike. So what’s up? Education Week outlines a few things district superintendents, CFOs, and school board members have said they think about when considering whether or not they should give their teachers a raise, including the dangers of using one-time money, back filling positions that were cut during the recession, reducing class sizes, and pensions.
The LAUSD-UTLA deal ignores the growing bite that retirement costs and underfunded pensions are taking out of the dollars earmarked for students and practicing teachers. Stanford’s Crane observes, “One-third of LAUSD’s retirement spending is for unnecessary, duplicative or excessive health insurance subsidies provided to retirees entitled to Medicare or ACA coverage. Terminating those subsidies could provide an immediate $10,000 salary increase for LAUSD teachers.” Yet, despite the ugly math, there are no indications that the LA deal does anything but kick the can on these profound challenges.
It looks like how and whether to spend more on K-12 schools this year will dominate this year’s legislative sessions. Many of the governors elected last fall are looking to deliver on promises they made on the campaign trail to provide more funding to schools and boost teacher salaries. More than 29 states still have not restored school funding to pre-recession levels and many districts continue to make dramatic cuts because of other obligations such as pensions and health-care costs. But expanding pre-K, boosting teacher pay, and assuring that new money is spent on the classroom is a complicated and politically arduous task. Education Week outlines a list of states where fights over school funding will be especially politically contentious.
New research from the University of California, Berkeley Center for Labor Research and Education and the National Institute on Retirement Security, comparing teacher pension plans and 401K-style accounts in six states, concludes that pensions generally provide greater value to teachers and play a critical role in retaining educators. However, since the market crash in 2008, 48 states have made changes to their pension plans as have many companies across the nation. Many states are now facing unfunded liabilities that range from mildly concerning to nearly catastrophic. These unfunded liabilities are threatening the security of some pension plans and causing states to divert money from other services, including education, to keep pace with funding the plans.
A district of over 13,000 students in Illinois ratified and approved a collectively bargained teacher contract months ahead of schedule. The contract fell within district budget projections, eliminated the traditional salary schedule, and rewarded teacher performance. In a post-Janus era, this type of collaboration could be increasingly valuable. Those involved noted that there were many factors that contributed to their success, but outlined seven essential steps that can now serve as guideposts for other districts interested in thinking about compensation differently.
The wage gap between teachers and comparable professionals has grown over time, with teachers now earning 18.7 percent less than other college-educated workers, according to a new analysis. A new paper published by the Economic Policy Institute, a nonpartisan think tank supported by labor unions, found that the “teacher wage penalty” has increased significantly—teachers earned just 1.8 percent less than comparable workers in 1994. And although teachers do receive better benefits packages than their college-educated peers, those benefits only mitigate part of the gap: Including benefits, teachers face an 11 percent compensation penalty.
School districts are spending bigger chunks of their budgets on staff benefits, leaving less money to spend in the classroom, a new study finds. Nationally, from 2005 to 2014, instructional spending increased by 2.6 percent, while spending on benefits for instructional staff members grew by 24 percent. Since education budgets have been largely flat, this means that spending on benefits is eating up more of districts’ money, and fewer dollars are making it into the classroom. Benefits are largely composed of health care and pension costs. Over the last decade, spending on teacher health-care benefits is up 30 percent, and spending on teacher retirement costs is up more than 50 percent, according to the report.
Related, this article summarizes the report’s recommended steps to addressing the problem: “Skyrocketing Spending on Benefits Hurts Teachers and the Schools That Employ Them. 4 Steps Toward Fixing That.”
Finally, for a specific example of the impact of the increasing cost of healthcare, see “LAUSD Is Now Diverting $2,300 Per Student to Cover Health Insurance Costs — 36 Percent More Than 5 Years Ago. Why the School Board Is Rushing to Avert a ‘Fiscal Cliff’”
Thanks to decades of mismanagement by politicians from both parties, Connecticut has one of the largest pension funding deficits in the country, amounting to one fifth of its annual economic output. The system needs a complete overhaul. Fortunately, models exist. Consider New Brunswick, Canada, which moved to a shared-risk system in 2012. Instead of promising full, generous pensions, the government guarantees only a “base” level of benefits and pays added “ancillary” benefits if circumstances allow. Regular stress tests determine what the government can afford: If it falls short, it can increase required contributions or reduce benefits — within a narrow, agreed-upon band. If performance improves, the changes are reversed in an agreed-upon order.