The salary gap between teachers and comparable professionals is larger in Indiana than in most other states, according to a new report from researchers at the Rutgers Graduate School of Education and the Albert Shanker Institute.
The report, “School Finance and Teacher Pay Competitiveness,” supports the argument that Hoosier teachers have fallen behind their peers in other states, despite Indiana’s healthy state budget.
Using education and census data, the researchers examine what’s commonly called the teaching penalty: the difference in average pay between teachers and non-teachers who are similar in terms of education, age and the number of hours they work.
“Overall, the magnitude of the teaching penalty varies quite widely by state,” authors Bruce Baker, Matthew Di Carlo and Mark Weber conclude, “but it is at least meaningfully large in all states, and the gap is larger for veteran versus young teachers in all but a handful of states.”
They estimate that Indiana teachers at age 25 are paid 24.1% less than comparable professionals in the state. At age 55, the gap widens to 31.1%. Those differences are on the high side among the states.
States with the biggest teaching penalties include Arizona, Oklahoma and Colorado, all of which were hit by recent teacher strikes.
The report is based on salaries and doesn’t include benefits, which can be generous for teachers. Including benefits in the estimates might reduce the teaching penalty, but it would still be sizeable, the authors write. Also, the data sample includes private school teachers, who tend to be paid less. But they make up a small percentage of teachers and likely don’t skew the overall findings.
The report finds the teaching penalty is smaller in states that spend more on education (adjusted for labor market costs and other factors) and in states that spend a bigger share of their economy on schools. That suggests states could reduce the penalty – and make it easier for schools to recruit and retain teachers – with better school funding policies. The researchers recommend that states boost funding, but they take no position on whether teacher raises should be targeted or across the board.
A national focus on teacher pay has led to calls for federal action. For example, Democratic presidential candidate Kamala Harris wants to boost teacher pay by an average of $13,500. But Baker, Di Carlo and Weber argue that any federal teacher-pay program should give priority to states that spend a larger share of their gross domestic product on education.
In other words, the feds should help states that help themselves. Unfortunately, Indiana isn’t one of those. An earlier report by the same authors shows that Indiana ranks near the bottom of the states for school funding “effort.” And that effort is getting weaker.
As Ball State University economist Michael Hicks writes, “If today we (Indiana) spent the same share of GDP on education as we did in 2010, we would have more than $1.56 billion extra this year alone.”