Teacher Trendline

September 2015: Lifetime Earnings

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Welcome to the Teacher Trendline, NCTQ's monthly newsletter designed just for school district officials (subscribe here). Each month we use data from NCTQ's Teacher Contract Database to highlight the latest trends in school district policies and collective bargaining agreements nationwide. The database contains teacher policies from 121 school districts and two charter management organizations, including the 50 largest districts, the largest district in each state, Broad Prize winners, Gates investment districts and members of the Council of the Great City Schools.Teacher policies from all 50 states are also included.Send feedback to teachertrendline@nctq.org.

You've heard it before: teachers aren't in it for the money. While money may not be the primary motivation for becoming a teacher, salaries matter. Salaries can play an important role in attracting and retaining the best teacher workforce possible. This month's Teacher Trendline updates NCTQ's analysis in Smart Money: What teachers make, how long it takes and what it buys them and estimates how much a teacher can make over his or her career, using salary information from the 2014-2015 school year.

Changes in salary

The average change in salary across districts in the database was 0.6 percent.[1] While 25 districts offered no salary adjustments, eight districts offered their teachers significant average increases of more than five percent. Wake County(NC), Fresno, San Diego and Guilford County(NC) all increased teachers' salaries by more than 6 percent on average. 

Starting and ending salaries

Across the 110 districts in this analysis, the average starting salary is $40,752 and average ending salary is $76,037.[2] Starting salaries range from $31,750 in West Ada (ID) to $51,539 in theDistrict of Columbia, while the projected salary after a 30-year career ranges from $52,925 in Oklahoma City to $106,540 in the District of Columbia.

Of course, in order to fairly compare teacher salaries across districts, the cost of living needs to be taken into account. For the rest of this Trendline, salaries have been adjusted using Regional Price Parities developed by the Bureau of Economic Analysis.[3] This adjustment means salaries can be compared across districts, as the adjusted salaries represent equal purchasing power.

Before we get to the results, it's important to note that the salaries and estimates of lifetime earnings reported in this piece are not directly comparable to the salaries and estimates of lifetime earnings reported in Smart Money. This is due to a change in the way cost of living was taken into account. As explained above, here we've used data from the Bureau of Economic Analysis to adjust for cost of living; in Smart Money we used a different measure from the Council for Community and Economic Research.[4] We made this change because the data from the Bureau of Economic Analysis is publicly available and makes our analysis more transparent. 

After adjusting salaries for cost of living, Northside(TX) offers the highest starting salary to teachers ($52,912). Albuquerque offers the lowest starting salary to teachers ($32,956). By the end of a 30-year teaching career, St. Louis offers the highest salary ($100,460) and Oklahoma City offers the lowest ($57,216).

Lifetime earnings

Starting and ending salaries don't tell the whole story. Just as important is how much a teacher can make throughout his or her career. To get a sense of this, we projected a teacher's potential lifetime earnings across 110 districts over a 30-year career using 2014-2015 salary schedules. This estimation assumes that a teacher begins teaching with a bachelor's degree and no previous experience, earns a master's degree after four years of teaching and a PhD (or the credit equivalent) after 10 years of teaching.[5] All projections are adjusted for the cost of living in each area.

As you can see in the map below, lifetime earnings vary greatly across districts. The median lifetime earnings, adjusted for cost of living, are $1.86 million. Teachers make more than $1.86 million in districts that are blue and less than $1.86 million in districts that are orange. You can access an interactive version of the map here

Teachers in Boston make the most across a 30-year career, $2.53 million.  Not too far behind is Hartford, where teachers make $2.51 million over their careers. Coming in third is Chicago with lifetime earnings of $2.38 million. Teachers in Albuquerque, Oklahoma City, Austin and Mesa (AZ) make the least over a lifetime, all earning less than $1.5 million over 30 years. 

Salary trajectory over time

Even more telling of how competitive a district's salary schedule is than starting and ending salaries and lifetime earnings is how a teacher's salary progresses over time. The graph below shows the salary for a teacher at any given year in four districts: Boston, the district where teachers earn the most over 30 years; Albuquerque, where teachers earn the least; Northside (TX), the district with the highest starting salary; and Portland (ME), a district that offers a low starting salary, but a high lifetime earning potential.

Although teachers in Boston and Portland start their first year of teaching with a pay difference of more than $10,000, both districts offer larger lifetime earning potential than two-thirds of the districts analyzed,  thanks to a relatively steep climb in salary. In fact, Portland rises to this position despite a starting salary in the bottom ten of the districts analyzed. In contrast, Northside offers the highest starting salary, but due to a relatively long, flat salary progression, teachers in Northside actually have below-average lifetime earnings potential.  

Generally, teachers in districts with faster climbs to higher salaries have higher lifetime earnings than those with long climbs. The average ending salary, adjusted for cost of living, is roughly $76,000. Using this as a benchmark, in 52 of the 56 districts with lifetime earnings below average, it takes longer than a 30-year career to make $76,000, whereas it takes longer than a 30 year career to make $76,000 in only eight of the 54 districts with above average lifetime earnings. Mouse over any district on the interactive map to see how long it takes to reach $76,000.

There is no doubt that starting and ending salaries are important factors in how much teachers make over a lifetime, but just as important is what happens in the years in between.

[1] NCTQ calculates changes in salary by matching, step for step, the current year's salary schedule and the previous year's salary schedule and calculating the percent change. We do this for all steps on the bachelor's and master's lanes and then take an average.

[2] Ending salaries are estimated based on a teacher who has earned a PhD or the credit equivalent and completed 30 years of teaching.

[3] Specifically, we used the 2013 Regional Price Parity for the Metropolitan Statistical Area where each district is located. 2013 data are the most recent available. 

[4] In developing cost of living indexes, statisticians must make assumptions about which goods and services to use to compare prices in each area and how to weight each good or service in accordance with how much people in each area spend their money. This is a nuanced process and thus no two measurements will be exactly the same.

[5] It is worth noting that in 46 districts there is some form of performance pay. This analysis assumes that in those districts, a teacher receives an effective evaluation rating every year and the salary increases or bonuses that are associated with that evaluation rating. In addition, this analysis does not include bonuses or pay increases associated with teaching in a hard-to-staff school or subject area.