Texas Public Policy Foundation “Misspeaks” When Predicting Higher Teacher Salaries Under Privatization

The Texas Public Policy Foundation, which is closely aligned with ALEC, Texans for Education Reform, and other groups determined to privatize public education, recently Tweeted:  “#SchoolChoice will increase average #Texas teacher pay.”  The following study, in response, was conducted by economist Dr. Larry Toenjes of Houston.  His source of data was the Snapshot data on the Texas Education Agency website.

Dr. Toenjes uses the term “monopsonist” that may be unfamiliar.  In his words, it “refers to a single employer in a given market area for labor of a certain type.  The monopsonist can exert his/her influence and pay a wage below what a market that consisted of numerous employers would establish in equilibrium.”

The “deformers” like to argue that public education is a monopoly and is therefore inefficient.  They are in favor of unregulated free markets to deliver education.  What they don’t “get” is that school districts compete mightily for quality teachers.  They compete against other Texas districts, against districts in other states, and even with other countries.  The number one reason we have seen school boards and superintendents use when they are selling a budget with higher salaries is that they need to be competitive in salaries, especially for teachers.

Please note that after many years of charter schools in Texas, in 2012-13, charter schools paid, on average, lower salaries to teachers than any category of Texas school districts.  (See averages in table by community type.)  The Texas Public Policy Foundation made a promise to Texas teachers without even examining Texas data, much less the data in other states.

Another point that needs to be made is that the “deformers” want schools where teachers do not have to be certified, who have little or no prior experience (such as Teach for America), who do not belong to unions or professional organizations, and who have no collective power or voice in decision-making.  These are the kinds of people who can be paid far less than public school teachers, so if public schools are totally destroyed, then we can expect teacher salaries to drop significantly, to be much less even than the average charter school teacher receives today.

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by Larry Toenjes, Ph.D.

If the Texas Public Policy Foundation is correct that the monopsony power of the public school system pushes teacher salaries below an otherwise fair market values, then how are charter schools, presumably without such monopsony power, able to hire equivalent teachers for even lower salaries?

Average Texas teacher salary by Charter or Community Type

 

                                                    

COMMTYPE N Mean
Charters SAL_TCH 202 $40,800
Independent Town SAL_TCH 70 $44,343
Major Suburban SAL_TCH 80 $50,467
Major Urban SAL_TCH 11 $51,147
Non-metropolitan Fast Growing SAL_TCH 32 $45,177
Non-metropolitan Stable SAL_TCH 182 $44,483
Other Central City SAL_TCH 41 $48,319
Other Central City Suburban SAL_TCH 165 $46,070
Rural SAL_TCH 445 $42,400

Data source: TEA Snapshot, school year 2012-2013.

N = Number of Districts of Each Community Type

 

The average teacher salaries in the column headed “Mean” are simple arithmetic averages of the teacher salaries reported in TEA’s Snapshot publication for school year 2012-2013.

 

It is difficult to imagine that charter schools, which pay teachers substantially less than most other schools in the state could have the effect of increasing overall teacher salaries, as is alleged by Michael Barba and Vance Ginn, Ph.D., at the Texas Public Policy Foundation. Barba and Ginn refer to testimony by one Dr. Jacob Vidgor in drawing their conclusions.

 

The case they try to build, however, rests on the very questionable assumption that the public school system comprises a monopsony in the market for teachers in Texas. This assumes that the various school districts do not bid against each other in their attempts to hire teachers. Barba and Ginn make no attempt to demonstrate that this is the case.

 

To repeat, if the public school system as a whole is able to keep teachers’ salaries below what would otherwise be a market equilibrium value, then one must ask how charter schools are able to hire comparable teachers at an even lower salary?

 

 

 

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