Main Street Macro: Wages and hiring: It’s not as simple as you think.

 

Main Street Macro: Missing the Mark: Trends in teacher salary

March 11, 2024 | read time icon 2 min

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Teachers are a crucial part of the economy. I should know–my mom is a teacher. They’re part of the care economy, often described by economists as the workforce behind the workforce.

In a new analysis, the ADP Research Institute’s Jeff Nezaj shows that even though the U.S. economy continues to add jobs at a rapid clip, the education sector is trailing behind. Here are three key findings.

Demand for teachers took off during the pandemic and remains strong

Using employment and wage data for public and private kindergarten through 12th-grade teachers, the ADP Research Institute built indexes to track employment trends. We found that job openings for educators have increased dramatically since 2021.

Last week, new government data showed that companies listed 11 percent fewer job openings at the beginning of last year. But job openings for private school teachers were up 12 percent.

Salaries have grown more slowly for teachers than for the workforce as a whole

As of October, teachers were earning an average of $68,000 a year, 8 percent less than the average for all U.S. workers. This pay gap has been widening over the past five years—it was only 3 percent in January 2018.

Young teachers saw the biggest decline in relative pay

Between 2018 to 2023, teachers aged 20 to 30 lost the most ground. This trend is an important one to watch because it has the potential to create or exacerbate labor shortages in education by discouraging would-be teachers from joining the profession.

The future of work starts with educating the future workforce. That’s why understanding what’s driving teacher supply and demand is so important to the Main Street economy. The full analysis of teacher salaries can be found at ADPRI’s Data Lab.