Amanda Ripley

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Are American Teachers Underpaid?

30th Jun 2014 posted in Education

Recently, I wrote a piece for Slate about the power of paying teachers in prestige--not just cash--and the ways that teacher colleges can make that happen. The most common response I got was the show-me-the-money argument: We cannot hope to make teaching more prestigious without paying teachers more. In Finland, I was told, teachers earn more than teachers in America--so of course the profession can be more selective.

Good news! This is simply not true. In fact, US teachers earn above average for the developed world at every grade and experience level. They earn even more than teachers in Finland!

Do they earn as much as they should? No, they do not (more on that below). This is a serious, intellectual job that demands serious pay. But if we keep exaggerating how bad our teachers have it, no one will want to become a teacher--and policy makers will continue to dismiss salary increases as an unimaginably expensive reform.

On the other hand, if we ground the conversation in facts, we might discover that the situation is not as overwhelmingly hopeless as we thought.

First things first: What does the evidence show about how well US teachers are paid? There are different ways to compare salaries. One way is the straightfoward way: compare teacher salaries across countries. To do this, you take a country's average teacher salary at different grade and experience levels, convert the figure into equivalent US dollars using Purchasing Power Parities to adjust for cost-of-living differences, and see how things stack up.

When you do this, as the OECD does, then you find out a startling truth: US teachers make more than teachers in Finland at every grade and experience level.

The pay gap is most glaring for elementary teachers. Here is the average salary (in equivalent USD converted using PPPs) for new elementary-school teachers in 15 countries:

1. Luxembourg $64,043

2. Germany $47,488

3. Switzerland $47,330

4. Denmark $43,461

5. United States $37,595

6. Netherlands $36,626

7. Spain $35,881

8.  Canada $35,534

9. Australia $34,610

10. Ireland $33,484

11. Norway $33,350

12. Belgium (Fl.) $32,095

12. Belgium (Fr.) $31,515

13. Austria $31,501

14. Portugal $30,946

15. Finland $30,587

The full list is here. If you rank order the data, you'll find that US teachers rank 5th in the world for starting-pay at the elementary level. They rank 7th after 15 years of experience. And 11th at the maximum allowed under their pay scales. The pattern persists in the older grades. In lower secondary school, US teachers rank 7th in the world based on average starting salary; 10th after 15 years of experience; and 9th at the maximum pay allowed. Salaries are similar for upper secondary. By contrast, Finnish teachers rank 15th for their starting salaries at the elementary level. They still rank 15th after 15 years on the job. Then they rank 21st at the maximum allowable salary. (In lower secondary, Finnish teachers rank 12th initially, 17th after 15 years and 20th at the pay ceiling. Upper secondary salaries rank similarly.)

Another way to compare salaries is to look at earnings in relative terms. How much are teachers earning relative to other professionals within the same country? From a recruiting perspective, this makes a lot of sense. Young people decide to become teachers (or not) based in part on their other options within their own countries.

By this metric, almost no countries come out looking good. All around the world, teachers tend to earn less than other professionals with college degrees. The problem is rooted in gender and history. But the gap between teachers and other professionals varies quite a bit.

By this measure, US teachers fare worse--mostly because other US professionals earn far more than their peers abroad (i.e. lawyers, doctors, bankers). US teachers earn about 2/3 of what their full-time, college-educated peers earn in other professions. (By comparison, Finnish elementary teachers earn 89% of what their professional peers earn.)

So in absolute terms, US teachers earn more cash than Finnish teachers. But relative to other professions within our country, US teachers earn less.

What's to be done about this? One solution would be to pay teachers more in the US; an even better solution might be to pay lawers, doctors and bankers less... Regardless, it is only sensible to look at total compensation--beyond just salary. After all, compensation is also about social capital--whether it is "cool" to tell people you are a teacher. In this sense, Finnish teachers earn far more of than their US peers. (Which leads back to the value of highly selective education colleges in building that prestige.)

Compensation also includes benefits, of course. And in that regard, US teachers earn fewer benefits in absolute terms compared to teachers in more generous social-welfare states; but they earn more relative to their professional peers within the US. Teachers have (on average) relatively good pension, health care and job-security benefits compared to college-educated professionals across America.

The equation is complex, in other words. But the bottom line is that teacher compensation is not as grim as most Americans think. And journalists have an obligation to tell these stories more accurately. For now, many Americans think teachers get paid less than they do, as this story by my Time colleague John Cloud explained a while back:

"In a TIME poll, 76% of respondents said many smart people don't go into teaching because it doesn't pay enough. That may be true, but most respondents in a McKinsey survey of 900 top-third college students said they believe, incorrectly, that garbage collectors are paid more than teachers. According to the Bureau of Labor Statistics, the average K-12 teacher in the U.S. makes approximately $49,000. Yes, the lowest 10% earn about $32,000, but the top 10% earn roughly $78,000. A chemistry teacher at a public school in an upscale suburban county can make $150,000 a year or more..."

If we want to make teaching more prestigious, we need to do many things. One thing is to tell the truth. The narrative of the teacher-as-charity-case has outlived its usefulness.