Welcome to the Profit of Education website. Continuing the conversation begun in the book Profit of Education, we discuss the latest economic evidence on education reform.

Teacher salaries

It’s Friday, so it must be time to point out yet another measure of what’s happened to teacher salaries. I’ve grabbed and graphed some data from the Digest of Education Statistics. The line shows the average salary of a classroom teacher relative to personal income of individuals in the labor force.

teacher salaries vs personal income

‘Twas better in the good old days.

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How broad is the benefit of charters?

We now have quite a bit of evidence that certain urban charter schools are very effective. (Note: by no means does this mean that the average charter school is very effective.) The best evidence comes from looking at admission lotteries in which researchers compare outcomes for students admitted in the lottery to those who missed out. What’s nice is that the two groups of students are likely similar in terms of unobservable background characteristics.

What’s not so nice is that both the winners and losers are “special” in the following sense: the students and/or their families were motivated enough to apply in the first place. Maybe charters work well for children from motivated families but not for others?

New research, “Charters Without Lotteries,” offers some good evidence that certain urban charters work whether students are from motivated families or not. The researchers take advantage of a kind of “natural experiment.” A number of middle schools in New Orleans (plus one in Boston) were converted to charter schools under a plan in which students already in the school were able to stay in the new charter version without having to apply. In other words, these students were in without having to be specially motivated.

Students in the New Orleans schools were compared to similar students in schools that weren’t converted. The “grandfathered” students had better outcomes than students who remained in traditional schools. In Boston, the researchers could actually compare students who were grandfathered into the converted school with students who won a lottery to get in. The grandfathered students did as well or better than the students from the families sufficiently motivated to enter the lottery.

Here’s one of the authors’ figures for New Orleans. The dark line shows math results for grandfathered charter students; the lighter line is for comparable non-charter students. Things were improving in New Orleans for both groups, but scores improved much faster for the charter school students.

Grandfathering

I think this is the first real evidence that charters can work for a broad group of students. A reminder though, the fact that particular charters (mostly “No excuse” schools) work well in a particular urban context does not mean that the broad spectrum of charters are similarly successful.

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Low income/high income

John Papay, Dick Murnane, and John Willet have a new paper, “Income-Based Inequality in Educational Outcomes,” that does two things: The authors show off what can be done with longitudinal state data systems and they give us some substantive results about what income differences do to educational outcomes. I particularly like the following picture, which packs so much information into a single graphic.

Murnane et al

The graph shows outcomes according to 8th grade math test scores (10-25-50-75-90th percentiles) and shows the gaps in outcomes between low-income (free and reduced price lunch) and high-income students (bottom versus top of each bar).

Doing well in math in eighth grade is a very strong predictor of whether a student will later go to college and an even stronger predictor of going to a four-year college. Doing well in math also predicts high school graduation, but the differences are less striking.

Does being a good student overcome the disadvantages of coming from a low-income family? The chart shows that high math scores help, but certainly don’t eliminate the differences. Those “gap” bars get smaller with higher test scores, they don’t go away.

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Teacher Pensions 2

A good pension, some private savings, and social security combine to give a person a financially secure retirement. Largely through an accident of history, teachers remain the single largest group of workers who are excluded from social security.

Some time back, the Federal government reorganized Federal pension systems to add in social security. The same really ought to be done for the more than 1 million teachers currently excluded from the social security system.

Researchers at Bellwhether Education Partners have put together a map showing which states include teachers in social security and which don’t.

bellwhether 2

Social security participation is especially important for the large number of teachers who spend part of their career teaching and part elsewhere. There’s no good reason that teachers should be treated differently when it comes to our national retirement security system.

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Teacher pensions 1

“Everyone knows” that teacher pensions are mucho generous. At least they’re generous compared to private sector pensions. One thing that’s missed is that many teachers don’t receive a penny of the promised pensions.

Just as is true nowadays in many professions, teachers move around much more than they used to. The private sector has largely switched to defined contribution plans, where you retain pension contributions (or role them over to a new plan) when you switch jobs. In contrast, teachers have the old-fashioned defined benefit plans. These plans are quite generous if you stick with one employer for life, but you lose everything if you switch employers before being vested.

The folks at Bellwether Education Partners have put some numbers to the situation. They offer us a nice little chart.

BW Pension

For example, 30 percent of California teachers get nothing at all out of the pension system. And not quite half teach long enough to get full benefits.

So while teacher pensions can be generous for career teachers, for many teachers the picture is much less rosy.

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  1. Adam W says:

    I remember being quite surprised when leaving Arizona that I had a small (but not insignificant) amount of pension benefits after only 2 years of teaching. I thought this was the norm!

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Selma

Selma

Thank you, Dr. King

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Teacher turnover factoids

I offer two factoids from the Digest of Education Statistics (Table 210.30, for those interested).

  1. Among teachers with a year’s experience or less, one quarter will be gone from the school where they were hired the following year. (That’s for teachers in public schools; in private schools a third are gone.)
  2. Just under a third of newbie public school teachers will have left teaching entirely by the end of three years. (Among private school teachers, two-thirds leave.)

Somehow we ought to be doing a better job of getting new teachers into jobs where they’ll stick around for a while.

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Returns to schooling

Economists measure the economic value of an additional year of education by the “return to schooling.” We ask whether an extra year of school adds 1 percent to your salary or 5 percent or 10 percent or whatever. “Return to schooling” is a lot like an interest rate, because school is an investment now that pays off in the future.

Today, if you’re earning 1 percent on you savings account you’re doing pretty well. Historically, a return of a few percent (after inflation) has been pretty good. Education pays a lot better than that.

One difference between investing in a savings account and investing in education is that everyone earns about the same from the bank, but some people get a much higher return from an extra year of education than do others.

Ozabaci and Henderson offer us some nice pictures of how much returns to education vary. The horizontal axis is the rate of return; the vertical axis is the fraction of people earning that rate of return or less. For example, in the graph at the upper left about 15 percent of black and Hispanic married men earn less than a 10 percent rate of return.

Returns to schooling Ozbaci and Henderson

So what fraction are earning a rate of return that would take a genius to earn from a bank or other financial investment? Almost everyone. Education pays!

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Double-dose, tests, and long-run achievement

Back in October I wrote about Chicago’s “double-dose” algebra program for 9th grade students with below median math scores. Evidence from Kalena Cortes and Joshua Goodman showed that giving very weak students a second math class each day really helped them get better grades. Now the authors, joined by Takako Nomi, have some very interesting results about longer-run results. In fact, two interesting results on quite separate points.

The “standard” interesting result is, in the authors’ words, “substantial positive impacts of double-dose algebra on credits earned, test scores, high school graduation and college enrollment rates.” Here’s one of the authors’ pictures, which shows: (A) Students with math scores just low enough to qualify for double-dosing were notably more likely to graduate high school than were students with similar scores who just missed eligibility. (B) Poor readers benefited even more from math double-dosing than did students as a whole.

Cortes and Goodman and NomiThe “not so standard” result is

test score impacts of this policy dramatically understate its long-run benefits as measured by educational attainment …. In our sample, … estimates suggest that a 0.2 standard deviation increase in fall grade 11 math scores, the upper end of our estimated treatment effect, is associated with a 2 percentage point increase in college enrollment rates. We observe college enrollment effects roughly four times that size, highlighting the fact that long-run analyses of such interventions may yield very different conclusions than short-run analyses.

What’s going on? Test scores don’t measure everything. Test scores are often the best single measure of progress. “Best” doesn’t mean perfect. There’s a real research dilemma here. The authors demonstrate the importance of looking at non-test outcomes, such as college attendance. But looking at long-run outcomes means waiting for years or even decades for data to become available. Not much help for today’s policy makers.

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  1. preserve says:

    Nice and Interesting paper.

    Did anyone else notice the discontinuity for the 8th grade reading score at the 8th grade math threshold?(Figure 1).

    Kudos to the authors for showing the covariate chart.

  2. I wrote about that study (probably earlier results) here: https://educationrealist.wordpress.com/2012/11/10/algebra-terrors/

    In short, sticking kids in school twice as long for algebra is a miserable frigging thing. I don’t disagree with your main point, but this study has multiple interpretations, most of which say “it was a horrible waste of time”.

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Ed degrees: bachelors vs masters

A quick picture of America’s annual production of new bachelor’s and master’s degree’s in education.

ba vs masters

The first thing to notice is that we’re giving out 40 percent more degrees than we did 20 years ago. The number of students has increased something under 20 percent over the same period.

The second thing to notice is that the growth is entirely in master’s degrees. Given the scientific consensus that the average master’s degree adds nothing to teaching ability, you sort of have to wonder what’s going on. Wonder somewhat cynically, I would say.

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