Interesting report. In general I don't see too much to argue with here - it does seem like public school teachers have had more job security (we'll see if that lasts) and public employee retirement benefits that are on average pretty generous.
I guess the one statistic that I'd be interested in digging a little deeper on is this one: "the average teacher who leaves for the private economy must take a pay cut of over 3%" - what I'm wondering is how this scenario plays out if you look 5 or 10 years down the road. Does the teacher who takes this initial pay cut end up with a higher salary in the private sector than the colleague who sticks with teaching?
I don't think this pay story fully explains why there are an excess of applicants for teaching positions - clearly many people believe there are both personal and societal benefits to teaching. I guess another angle on this is looking at how many young teachers end up on the long-term retirement track, versus those who teach for some years and then move to something else.
Curt, the point is - and this is my latest "economist" point, though I am degreed but non-practicing - the teaching jobs are "non-wealth producing jobs" and in the long run cannot exceed the income level of "wealth producing jobs".
In the economic sense, you must have wealth producing jobs to afford the non-wealth producing jobs you agree to allow. When the former becomes smaller than the latter - EUROPE - and the future of the U.S.
Your argument will probably be that TEACHING is a wealth producing job - how else do we educate our people to participate successfully in the world economy. But this is not in the ECONOMIC sense - that is, a job must produce WEALTH - so we can afford non-wealth producing jobs (teaching, cops, fireman, government, et al.)
If you exceed the ability to "pay" for non-wealth producing jobs, IT IS ALL OVER!!!
Interested in your comments. Sorry we don't have a group participating, I had hoped when I advised you of this site we would have more participants. We'll see!
I think the larger argument is around whether paying teachers more is the answer to our education issues. And I'm not convinced that it is - I don't really have a horse in this race. I think dedicated teachers work incredibly hard, but I also understand that effort is not the way that wages are set.
I do think it's an interesting question about teachers and "wealth-production". Would you say that a corporate trainer is in a "wealth-producing job" or not? I got paid quite well for a couple years to teach classes to new employees, and I believe the corporate folks who decided to hire me made the correct economic decision (of course I'm a little biased!).
I think that it would be good to find ways to reward the very best teachers - because I do think they can have incredible impact on peoples lives, and also follow-on impacts in terms of productivity down the road. But I also think there are plenty of poorly-motivated teachers who are hanging on for the retirement benefits, and are likely overpaid for what they are actually contributing. Trouble is it's not always so easy to distinguish the good from from the mediocre.
No! This is the smaller argument - and one worth having although how anyone after the last three or four decades can think $$ has anything to do with teaching results is living in an alternate world - I believe I posted some numbers in a past post that showed the increase in spending on public education since the mid 60's.
My point on "wealth production" is the only point at this time regarding pay of all public employees - teaching started the discussion, but it is only a small portion of the problem (it seems to me I may have posted below on a lifeguard in Orange County California who makes over $200K per year and if you don't think that is the major problem, think again!).
A change in subject to basic ecomonics (much simmplified)from my perspective that may lead the discussion in a productive direction:
There are two types of "jobs":
Wealth Producing and Wealth Consuming
Wealth Producing = private sector jobs in a "profit and loss" environment - "profit is wealth"
Wealth Consuming = public sector jobs with no "profit and loss" environment - therefore no "wealth" is created
Wealth Consuming jobs must (this is just very basic logic) be controlled to some level by the amount of Wealth Creating jobs. If not you run out of money. If you disagree with this I would like your reasoning.
Europe is in crisis now - and you were there first hand to observe - because they have not controlled the number of Wealth Consuming jobs - including pensioners who continue after retirement (Note that Italy, in crisis as we speak, has MORE pensioners than workers today!!) - versus the Wealth Producing jobs. Again, if you see a different reason for the crisis I would like your opinion.
Finally, re your teaching at your employer, this is not a "public sector teaching job", but one controlled by a "profit and loss" environment and is therefore a Wealth Producing job. Your question is the same I was asked by my Comptroller when I asked her if she was Wealth Producing or Wealth Consuming - NBI makes a profit so she also in a Wealth Producer.
After we resolve this potential "world as we know it" destroying problem, then we can attack how to reimburse good teachers.
Sorry to be so talkative, but it is an important subject and deserving of great attention by all!
I don't see things in quite as black and white terms - i.e. only 'wealth producing' (private sector for profit) or 'wealth consuming' (public sector).
To me it is clear that at least some of the public sector work produces the infrastructure that is used by the private sector to help create wealth. If the private sector didn't rely on various public sector inputs, wealth would be a whole lot harder to generate. So I'd say that some public expenditure is more in the nature of investment - in the infrastructure and rules that help the public and the private sectors. That said, it doesn't mean I think you can spend as much as you want on public sector investment, and as I've already stated, I'm not convinced that spending more on education will solve things.
I agree that there obviously need to be limits on what can be spent on the public sector. Some European countries have unsustainable public sector policies, just as many American cities and states do. Unsustainable by definition means it won't continue, but it will likely be a painful process for all involved to adjust to the realities.
Interesting report. In general I don't see too much to argue with here - it does seem like public school teachers have had more job security (we'll see if that lasts) and public employee retirement benefits that are on average pretty generous.
ReplyDeleteI guess the one statistic that I'd be interested in digging a little deeper on is this one: "the average teacher who leaves for the private economy must take a pay cut of over 3%" - what I'm wondering is how this scenario plays out if you look 5 or 10 years down the road. Does the teacher who takes this initial pay cut end up with a higher salary in the private sector than the colleague who sticks with teaching?
I don't think this pay story fully explains why there are an excess of applicants for teaching positions - clearly many people believe there are both personal and societal benefits to teaching. I guess another angle on this is looking at how many young teachers end up on the long-term retirement track, versus those who teach for some years and then move to something else.
By the way - Curt here - I'm Jim's nephew.
Todd and Matt - jump in!!
ReplyDeleteCurt, the point is - and this is my latest "economist" point, though I am degreed but non-practicing - the teaching jobs are "non-wealth producing jobs" and in the long run cannot exceed the income level of "wealth producing jobs".
In the economic sense, you must have wealth producing jobs to afford the non-wealth producing jobs you agree to allow. When the former becomes smaller than the latter - EUROPE - and the future of the U.S.
Your argument will probably be that TEACHING is a wealth producing job - how else do we educate our people to participate successfully in the world economy. But this is not in the ECONOMIC sense - that is, a job must produce WEALTH - so we can afford non-wealth producing jobs (teaching, cops, fireman, government, et al.)
If you exceed the ability to "pay" for non-wealth producing jobs, IT IS ALL OVER!!!
Interested in your comments. Sorry we don't have a group participating, I had hoped when I advised you of this site we would have more participants. We'll see!
I think the larger argument is around whether paying teachers more is the answer to our education issues. And I'm not convinced that it is - I don't really have a horse in this race. I think dedicated teachers work incredibly hard, but I also understand that effort is not the way that wages are set.
ReplyDeleteI do think it's an interesting question about teachers and "wealth-production". Would you say that a corporate trainer is in a "wealth-producing job" or not? I got paid quite well for a couple years to teach classes to new employees, and I believe the corporate folks who decided to hire me made the correct economic decision (of course I'm a little biased!).
I think that it would be good to find ways to reward the very best teachers - because I do think they can have incredible impact on peoples lives, and also follow-on impacts in terms of productivity down the road. But I also think there are plenty of poorly-motivated teachers who are hanging on for the retirement benefits, and are likely overpaid for what they are actually contributing. Trouble is it's not always so easy to distinguish the good from from the mediocre.
"I think the larger argument..."
ReplyDeleteNo! This is the smaller argument - and one worth having although how anyone after the last three or four decades can think $$ has anything to do with teaching results is living in an alternate world - I believe I posted some numbers in a past post that showed the increase in spending on public education since the mid 60's.
My point on "wealth production" is the only point at this time regarding pay of all public employees - teaching started the discussion, but it is only a small portion of the problem (it seems to me I may have posted below on a lifeguard in Orange County California who makes over $200K per year and if you don't think that is the major problem, think again!).
A change in subject to basic ecomonics (much simmplified)from my perspective that may lead the discussion in a productive direction:
There are two types of "jobs":
Wealth Producing
and
Wealth Consuming
Wealth Producing = private sector jobs in a "profit and loss" environment - "profit is wealth"
Wealth Consuming = public sector jobs with no "profit and loss" environment - therefore no "wealth" is created
Wealth Consuming jobs must (this is just very basic logic) be controlled to some level by the amount of Wealth Creating jobs. If not you run out of money. If you disagree with this I would like your reasoning.
Europe is in crisis now - and you were there first hand to observe - because they have not controlled the number of Wealth Consuming jobs - including pensioners who continue after retirement (Note that Italy, in crisis as we speak, has MORE pensioners than workers today!!) - versus the Wealth Producing jobs. Again, if you see a different reason for the crisis I would like your opinion.
Finally, re your teaching at your employer, this is not a "public sector teaching job", but one controlled by a "profit and loss" environment and is therefore a Wealth Producing job. Your question is the same I was asked by my Comptroller when I asked her if she was Wealth Producing or Wealth Consuming - NBI makes a profit so she also in a Wealth Producer.
After we resolve this potential "world as we know it" destroying problem, then we can attack how to reimburse good teachers.
Sorry to be so talkative, but it is an important subject and deserving of great attention by all!
I don't see things in quite as black and white terms - i.e. only 'wealth producing' (private sector for profit) or 'wealth consuming' (public sector).
ReplyDeleteTo me it is clear that at least some of the public sector work produces the infrastructure that is used by the private sector to help create wealth. If the private sector didn't rely on various public sector inputs, wealth would be a whole lot harder to generate. So I'd say that some public expenditure is more in the nature of investment - in the infrastructure and rules that help the public and the private sectors. That said, it doesn't mean I think you can spend as much as you want on public sector investment, and as I've already stated, I'm not convinced that spending more on education will solve things.
I agree that there obviously need to be limits on what can be spent on the public sector. Some European countries have unsustainable public sector policies, just as many American cities and states do. Unsustainable by definition means it won't continue, but it will likely be a painful process for all involved to adjust to the realities.