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The Cost of Underpaying Texas Teachers
March 2006

My goal is to drive more of every education dollar directly into the classroom with the teachers and students, where it belongs. I would rather spend $1.7 billion now investing in our future, than lose $13.8 billion year after year after year paying for failed policies of the past.
— Carole Keeton Strayhorn, Texas Comptroller

In December 2004, Comptroller Strayhorn released a report, The Cost of Underpaying Texas Teachers, which recommended immediate across-the-board salary increases for Texas teachers and an automatic annual adjustment to keep their salaries at or near the mid-point nationally, as well as mentors for all new teachers and bonuses for all teachers in schools that raise student performance.

But the 79th Legislative regular and special sessions in 2005 came and went without any real improvement in the situation. Teachers actually lost ground in a number of areas. Pay for Texas teachers remains low and keeping qualified teachers in the classroom remains a serious challenge.

Supervision and management of all of the state’s fiscal concerns is a primary duty of the Comptroller. The fiscal implications stemming from underpaying Texas teachers is of grave concern.

According to multiple state and national studies, a shortage of good teachers in key areas hurts student performance and actually prompts many students to drop out. Most students drop out due to poor academic performance—and in schools, teachers make the greatest single difference in academic achievement, regardless of their students’ economic or ethnic backgrounds.

The creation of an educated work force is a serious and continuing problem in Texas, where nearly a quarter of residents aged 25 and older lack a high school diploma. For those without a high school diploma, job prospects are bleak. According to U.S. Census data, dropping out costs men $403,902 in lifetime earning potential, and women $260,771. And dropouts cost the state and federal governments nearly $1.4 billion annually in social spending, as they are 7.6 times more likely to be incarcerated, three times more likely to receive Temporary Assistance for Needy Families (TANF) than high school graduates, and four times more likely to receive food stamp assistance.

Each year, another 40,000 to 50,000 students drop out of Texas public schools, costing the state $11.8 billion in lost gross state product (GSP) over their working lives. And this process is cumulative. Every additional dropout increases the long-term cost to the Texas economy.

At current rates, 10 years’ worth of dropouts will cost Texas $118 billion in long-term economic output, while 20 years will shave $236 billion off the state economy.

Our state economy simply cannot remain healthy without an educated work force, and we cannot create and maintain that work force without the help of dedicated and qualified teachers.

To ensure its economic stability, Texas must recruit, reward, and retain a stable pool of qualified and experienced teachers that are fully certified in their subjects and prepared to spend their careers teaching. Last year, 37,700 Texas teachers left the classroom for other professions or to retire. Growth in the state’s school-aged population demands another 5,000 new teachers each year, and at present that goal is not being met.

In September 2004, State District Judge John Dietz ruled that the state’s method of funding public schools violates the Texas Constitution on two grounds: the amount of funding is insufficient to meet the constitution’s requirement to provide “a general diffusion of knowledge”; and the statutory tax cap of $1.50 has effectively removed “all meaningful discretion” from school districts and thus has become an unconstitutional state property tax.

On November 22, 2005, the Texas Supreme Court expressed serious concern on the issue of providing adequate educational services and upheld the school district plaintiffs’ contention that the public school property tax is, in effect, an unconstitutional statewide property tax. The court gave the Legislature until June 1, 2006 to remedy constitutional defects in the current school finance system. A special session to address the issue is expected to begin April 17, 2006.

Texas must address the important mandate from the courts, but we must not lose sight of the true mission and goal of our public schools—educating our children. The quality of education in Texas cannot and will not improve if we are unable to recruit, reward and retain highly qualified teachers for Texas classrooms.

I. Teachers: The Most Important Factor in Student Success

Comprehensive studies in Texas and Tennessee have shown that students taught by fully certified and experienced teachers can overcome significant economic and environmental challenges. When similar students have less-qualified teachers, their likelihood of success is much lower.

The Tennessee study, Teacher Quality and Equity in Educational Opportunity: Findings and Policy Implications, originally released in 1996 by June C. Rivers and William L. Sanders, examined students with a history of making gains on standardized tests according to the “effectiveness” of the teachers they had. This effectiveness was measured by teachers historical success in producing gains in students’ test scores.

The researchers found that high-achieving students with the most effective teachers gained 25 percentile points on standardized exams in one year, while those with the least effective teachers gained only two points. The impact on low-achieving students—those not expected to produce significant gains based on prior tests—was even greater; those placed with the most effective teachers gained 50 points, while those with the least effective teachers gained only 14 points.

Texas researchers with Dallas Independent School District (ISD) studied fourth-graders in the district for three years in a row. Students with effective teachers, as measured by previous student performance on achievement tests, were compared with those judged to have less effective teachers. In their 1997 report, Teacher Effects on Longitudinal Student Achievement: A Report on Research in Progress, the scores of DISD fourth-graders with effective teachers rose by 16 percentile points in reading and math by sixth grade, while the scores for students assigned to ineffective teachers dropped by 18 percentile points in reading and 33 points in math.

Over the last 20 years, numerous studies by noted authorities, such as the US General Accounting Office and the National Research Council, have clearly shown that students with a history of poor academic performance, evidenced by low grades and poor test scores, are more likely to drop out than students with a history of academic success.

Research continues nationally on this topic, but the seminal work presented in these studies was a determining factor in the “highly qualified teacher” requirement contained in the federal 2001 No Child Left Behind legislation (See page 5).

Turnover, Qualifications and Student Performance

A direct correlation can be made between student test scores and the presence of a stable and qualified (meaning teachers who are teaching in their field of certification) teaching staff.

Exhibits 1 and 2 provide Texas Assessment of Knowledge and Skills (TAKS) test data for campuses grouped by both the percentage of teachers who left after the 2003-04 school year, and by the percentage of teachers teaching outside their certification fields in 2003-04.

Texas Teacher Turnover and Student Performance, 2003-04

Percent of Teachers Leaving the Campus after 2003-04 Percent of Students Passing All Sections of the 2003-04 TAKS at the Panel-Recommended Standard Percent of Texas Students In This Category
0-10% 66.1% 14.2%
11-20% 61.8% 39.7%
21-30% 57.9% 28.4%
More Than 30% 52.2% 17.7%
Statewide Average 59.3% 100.0%

Sources: State Board for Educator Certification (SBEC), and Texas Education Agency (TEA), Academic Excellence Indicator System (AEIS).

Texas Teachers Teaching Outside Their Field and Student Performance, 2003-04

Teachers Teaching Outside Their Field in 2003-04 Percent of Students Passing All Sections of the TAKS 2003-04 at the Panel Recommended Standard Percent of Texas Students In This Category
0-10% 68.4% 41.8%
11-20% 59.2% 30.2%
21-30% 53.1% 16.4%
More Than 30% 45.2% 11.5%
Statewide Average 59.3% 100.0%

Sources: SBEC and TEA, AEIS.

In the exhibits, “Panel Recommended Standard” refers to the passing standard for the new TAKS test adopted by the State Board of Education (SBOE) in November 2002. Because the new TAKS is more challenging than its predecessor, the Texas Assessment of Academic Skills (TAAS), the SBOE agreed to a transition plan to phase in the new standard over several years. Although the Panel Recommendation was not used to determine accountability ratings in the years shown in Exhibits 1, 2, and 3, it is the standard currently used by the Texas Education Agency to evaluate student performance.

These patterns are particularly noticeable in high school performance. In high schools with the lowest percent of students completing their education and passing TAKS at the panel-recommended standard, teachers are leaving more frequently and are more likely to be teaching outside their fields (Exhibit 3).

Secondary Student Performance vs. Teacher Profiles

Student Performance Teacher Profiles
% Students Completing High School 2004 % Students Passing TAKS 2004-05 at Panel-Recommended Standard % Teachers Leaving in 2004 % Teachers Teaching Outside Their Field 2004
< 95% 36.1% 21.8% 22.1%
95-97.99% 49.9% 20.0% 19.0%
98-100% 60.8% 21.2% 19.0%
Source: Completion and TAKS data from TEA, AEIS; teacher data from SBEC.

...and Experience Counts

Students taught by teachers with more than five years experience consistently score better on the TAKS (Exhibit 4). This underlines the need to support newer teachers and help them gain the experience they need to teach effectively.

Teacher Experience vs. 2004-05 TAKS Performance

Average Level of Teacher Experience per Campus Percent of Students Meeting State Board Panel Recommendation on TAKS
0 to 5 Years 62%
6 to 10 Years 64%
11 to 15 Years 64%
15 to 20 Years 65%
Over 20 Years 70%
Source: TEA, AEIS.

II. Texas Teachers: How They’re Made, Why They Leave

Teacher Training

Texas public schools employ nearly 295,000 teachers, including full- and part-time teachers and permanent substitutes. To be a teacher in Texas, an individual must have:

  • a bachelor’s degree from an accredited college or university. Texas higher education institutions do not offer a baccalaureate degree in education per se. Every teacher must have an academic major as well as teacher training courses. The only exemption from this requirement is for individuals seeking Career and Technology certification to teach certain courses such as welding or computer-aided drafting.
  • teacher training through an approved program. These programs are offered through colleges and universities, school districts, regional education service centers, community colleges, and other entities.
  • successful completion of the appropriate teacher certification tests for the subject and grade level to be taught.

Texas teacher candidates must pass one of two test types: the Texas Examinations of Educator Standards (TExES) or the Examination for the Certification of Educators in Texas (ExCET). ExCET tests and related certificates are being replaced as new TExES tests are introduced. As each new TExES test is introduced, both the new test and the ExCET test it is intended to replace will be administered for one year. After that initial year, the ExCET test no longer will be administered and the TExES test will be required for certification in that field.

Most Texas teachers have college degrees or have passed certification tests. Of the nearly 295,000 teachers in the classroom during 2004-05, 3,176 lacked a college degree (Exhibit 5).

Texas Classroom Teachers by Highest Degree Held, 1998-99 and 2004-05

1998-99 Count % of Total 2004-05 Count % of Total
No Degree 3,321 1.3% 3,176 1.1%
Bachelors 191,174 73.6% 226,981 77.1%
Masters 64,087 24.7% 62,637 21.3%
Doctorate 1,156 0.4% 1,464 0.5%

Source: TEA, AEIS.

Teachers from other states or countries who hold acceptable credentials can gain certification in Texas by passing the appropriate state tests. Some teachers can gain certification in Texas based on tests taken in other states, if the State Board for Educator Certification (SBEC) has found those tests to be similar to and at least as rigorous as Texas’. SBEC began reviewing other state’s tests in fall 2001 and has issued a list of comparable tests. It should be noted that the 2005 Legislature moved SBEC into the Texas Education Agency (TEA), where it is now known as the Division of Educator Certification and Standards. References to “SBEC” in this report also may refer to this new TEA division.

Paths to Certification

SBEC reports that 21,991 new teachers received Texas teaching certificates in 2004-05 (Exhibit 6). Of these, colleges and universities prepared approximately 39 percent; 15.9 percent were prepared through post-baccalaureate programs; and 45 percent were prepared through alternative certification programs—that is, programs that offer a person who already has a college degree additional training in how to become an effective teacher, as well as any additional coursework they may need in the subject area they wish to teach. Many of these programs can be completed in a year, during which time the person may hold a paid teaching position.

“Alternative” certification, then, has become the most common route to the teaching profession in Texas. SBEC also reports that alternative certification programs produce most of the state’s new male teachers, minority teachers, and teachers certified in critical shortage areas.

Exhibit 6 examines the various ways in which Texas teachers obtain their initial certifications.

Initially Certified Teachers by Certification Route
1999 vs. 2005

Certification Route 1999 Frequency 1999 Percent 2005 Frequency 2005 Percent Difference % Change
Alternative 2,662 17.7% 9,900 45.0% 7,238 271.9%
Post-Baccalaureate 2,594 17.3% 3,505 15.9% 911 35.1%
Undergraduate 9,744 65.0% 8,586 39.0% -1,158 -11.9%
Total 15,000 100.0% 21,991 100.0% 6,991 46.6%
Source: TEA Division of Educator Certification and Standards (formerly SBEC).

Teachers holding certificates issued on or after Sept. 1, 1999, as well as those holding “lifetime certificates” who voluntarily opted into the present certificate renewal system, must obtain between 150 and 200 hours of continuing professional education (CPE) every five years from an SBEC-approved provider to renew their certificates. District-provided in-service training generally satisfies the CPE requirement, as can other activities such as college coursework, professional seminars, mentoring experience, and self-directed study. SBEC counts one semester credit hour earned at an accredited institution of higher education as equivalent to 15 CPE “clock” hours.

In addition, some districts require additional training as a condition of employment. Such districts decide what will count for their own purposes, but cannot decide what will serve for CPE purposes.

The Temporary Teacher Certificate

In April 2004, SBEC approved the creation of a Temporary Teacher Certificate (TTC). The TTC allows college graduates with no teacher training to teach classes in grades 8-12. The new rules also allowed school districts to hire uncertified teachers if they have a college degree in the subject area they wish to teach.

Persons requesting a TTC must be employed by a Texas school district for the two-year period of the certificate. The school district assumes responsibility for training them. School districts wishing to hire candidates using the TTC must prepare and submit a Preparation, Mentoring, and Support Plan to SBEC for review and approval; hire and recommend the candidate to SBEC for the TTC; and recommend the candidate for a standard certificate at the end of the two-year TTC period.

As of December 2005, however, SBEC had approved only four schools or school districts for participation in the TTC program: Albany ISD, Gonzales ISD, Nancy Ney Charter School in New Braunfels, and Richard Milburn Academy in Midland. Only one teacher in the Richard Milburn Academy has been certified via TTC in the last 18 months.

According to one teacher group, the TTC program has failed because the rule makes the school district responsible for everything, including mentoring, supervising, and training. Because SBEC adopted this program by rule, no legislation was involved and the state has not appropriated funds to assist districts with the program.

The Comptroller’s January 2003 report, Limited Government, Unlimited Opportunity, recommended that the state provide fully funded stipends for experienced, quality mentor teachers to work directly with individuals entering the profession without traditional teacher training.

No Child Left Behind: New Requirements

According to the federal No Child Left Behind Act of 2001 (Public Law 107-110), all teachers hired for the 2002-03 school year and beyond to teach core academic subjects in programs supported with Title I, Part A federal funds must qualify as “highly qualified.” As a matter of clarification, TEA sends federal Title I, Part A funds to schools based on their number of economically disadvantaged students—those eligible for free or reduced-price lunches and breakfasts. The students actually served, however, must be selected on a basis of educational need rather than economic status.

Under federal rules, “highly qualified” means that the teacher:

  • has obtained full state certification as a teacher or has passed the state teacher licensing examination and holds a license to teach in the state;
  • holds a bachelor’s degree at minimum; and
  • has demonstrated subject-area competence in each of the core academic subjects he or she teaches. U.S. Department of Education (USDE) Rule 34 CFR §200.55(c) defines core academic subjects as English, reading or language arts, mathematics, science, foreign languages, civics and government, economics, arts (art, music, dance, and theatre arts), history, and geography.

And USDE rules have made this requirement even stricter. As of January 2, 2003, all states receiving Title I, Part A funds must ensure that all teachers of core academic subjects, whether hired before 2002-03 or not, meet the “highly qualified” standard by the end of the 2005-06 school year.

In October 2005, however, the U.S. Secretary of Education announced that states and school districts may qualify for an extension in meeting this requirement. States that are judged to be making a good-faith effort but do not yet have 100 percent of their teachers meeting the “highly qualified” standard can apply for the extension with USDE. If a state does not meet the standard for highly qualified teachers but meets other federal requirements, it may be allowed to submit a revised plan by May 31, 2006, outlining how it will reach the standard by the end of the of the 2006-07 school year.

USDE Rule 34 CFR §200.56(a)(2)(ii) allows teachers participating in alternative certification programs who hold at least a bachelor’s degree and have demonstrated subject-area mastery to be considered highly qualified. This rule establishes standards for an acceptable alternative route to certification as being one that:

  1. provides high-quality professional training that is sustained, intensive, and classroom-focused, so as to have a positive and lasting impact on classroom instruction;
  2. provides intensive supervision consisting of structured guidance and regular ongoing support for teachers;
  3. allows the candidate to function as a teacher only for a specified period of time not to exceed three years; and
  4. requires the teacher to demonstrate satisfactory progress toward full certification as prescribed by the state.

The rule further stipulates that the state’s certification and licensing process must ensure that these provisions are met.

Teacher Compensation

Funding for Texas school operations, including salaries, comes from federal, state, and local sources, with state formulas determining how much must be paid directly from local taxes.

The Texas Legislature first established a required minimum salary for teachers in 1949. While the state enforces the minimum salary schedule, school districts are responsible for paying teacher salaries. Many offer salaries in excess of the state minimums.

The state’s Educational Opportunity Act of 1984 enacted sweeping reforms in public education, among them provisions designed to attract and retain teachers by giving them a pay raise; providing for a planning period during the school day; instituting lower pupil-teacher ratios for the early grades; and adopting a career ladder as an incentive for performance.

The Texas Teacher Career Ladder, in place from 1984-85 through 1992-93, provided salary supplements ranging from $1,500 to $6,000 for teachers at level 2 or higher on the career ladder. Advancement along the career ladder was based upon district assessments of performance, certain training requirements, and years of service.

At level four of the career ladder, teachers would have been required to assume other duties such as supervising student teachers, acting as team leaders or mentors, conducting advanced academic training, and assessing other candidates for level four. The Legislature abolished the career ladder in 1993, before any teachers attained this level, but that legislation also stipulated that teachers would continue to receive any supplements earned while the program was in place.

In 1995, a sweeping rewrite of the Texas Education Code (TEC) increased minimum teacher salaries by 5.5 percent for the 1997-98 school year. The Legislature also appropriated funds for another 1 percent increase for 1998-99.

The rewrite also expanded the number of years included in the minimum salary schedule from 10 to 20 years, meaning that teachers with 11 to 20 years of service were guaranteed an annual step increase. To ensure that the minimum teacher salary adjusts automatically whenever the Legislature appropriates new money for education, the rewrite converted the minimum salary schedule from hard-dollar numbers (cited in TEC Section 16.056 [c]) to a formula-driven calculation (in Section 21.402 of the revised code). The formula and some definitions have changed somewhat since 1995, but the formula approach is still used to calculate minimum teacher salaries today.

The state base salary schedule in TEC Section 21.402 applies to all classroom teachers and all full-time librarians, counselors, and school nurses. There is no state minimum salary for any other public education position.

Texas teachers have not received a legislatively authorized, state-funded salary increase since 1999-2000, when late in the session in 1999, Comptroller Strayhorn identified $807 million that allowed then-Governor George W. Bush to sign into law legislation that included funding for a $3,000 annual salary increase for teachers, counselors, librarians and school nurses.

In 2005, a rider to the state’s general appropriations bill adjusted the school funding formulas, inadvertently triggering an unfunded increase in the minimum teacher salary schedule. The governor’s June 2005 veto of the education section of the appropriations bill negated this change, and a new version of the bill passed in special session eliminated the triggering language.

A subsequent governor’s executive order directed the education commissioner to initiate a rewrite of 19 TAC §153.1022 to redefine the calculation of the minimum salary schedule. This restored the vetoed increase in minimum salary without additional state funding or legislative action. The revised rule requires a retroactive increase in salary for 2005-06 only for teachers currently paid minimum salary. The additional $4 to $5 million estimated cost of this increase will be borne entirely by local districts.

In February 2006, TEA, acting by executive order of the Governor, unveiled an incentive pay plan that recommends salary bonuses of from $3,000 to $10,000 per individual on approximately 100 of the state’s nearly 8,000 campuses. Eligible campuses can apply for a three-year grant, teachers must be involved in the development of the local incentive plan, and 75 percent of the grant must be used to award incentive pay to classroom teachers. The remaining 25 percent may be used to provide incentive pay to other staff, or may be used to provide teacher training or to support teacher mentoring or induction programs.

Health Benefits Given, Taken Away

In August 2003, Comptroller Strayhorn pointed out in a public report to the people of Texas that the new taxpayer fees, charges, and out-of-pocket expenses that were signed into law at the end of the regular session, would cost Texans an estimated $2.7 billion over the 2004-2005 biennium. The actual cost was higher. $1.1 billion of that fell squarely on the shoulders of our Texas public schools and our teachers.

Over the last six years, not only were retired and active teachers and public school employees not helped to meet rising health care costs, money was actually taken out of their pockets.

The 2001 Legislature established a statewide health insurance plan for teachers and other employees of school districts. Participation in the plan was to be phased in by size of district; districts with self-funded plans were exempted from participation. All districts, whether participating in the state insurance plan or not, received from the state a monthly $75 per employee to pay for health coverage. In addition, each district employee became entitled to an annual $1,000 (or $83 a month) in state funds to use for health insurance contributions, health care expenses, or compensation.

In 2003, however, the $1,000 health insurance supplement was cut to $500 for full-time teachers and many support staff and eliminated entirely for other professional employees and administrators. In 2005, instead of restoring the health insurance supplement, the Legislature continued the reduced supplement.

The Legislative Budget Board estimates that reducing the supplement will save the state and cost Texas educators a total of $629 million in the 2006-07 biennium.

Changes made by the 2003 Legislature forced retired and active teachers and school employees to pay $254 million more for healthcare in 2004 and 2005. Included in the additional costs were copays, deductibles, and coinsurance. At the same time, their health insurance premiums increased, costing them or their districts $543 million more in 2004 and 2005.

Retirement Changes

The 2005 Legislature made significant changes affecting Teacher Retirement System (TRS) members and retirees, all of them tending to make the profession less attractive.

The changes concern service credit, retirement eligibility, employment after retirement, and eligibility for the retiree health insurance program, TRS-Care.

Teachers and all other TRS members generally are eligible for retirement when their age and years of service add to 80, commonly called the “rule of 80.” A provision in law that allowed members to purchase years of service credit to meet the rule of 80 was repealed as of January 1, 2006. Out-of-state service credit purchases, for years of employment in another state, require an increased contribution from members after January 1, 2006.

Retirement eligibility for current TRS members has not changed, but individuals becoming members on or after September 1, 2007 will face new requirements. To receive a full annuity at retirement, these members must be aged 65 with at least five years of service, or aged 60 with at least five years of service and meeting the rule of 80. Members who retire before age 60 but meet the rule of 80 with at least five years of service will have their annuities reduced by 5 percent for each year of their age under 60.

Also, all school districts now must pay a new health benefit surcharge for each retiree enrolled in TRS-Care and working in a TRS-covered position.

Finally, school districts now are required to pay a monthly surcharge to TRS for each retiree they rehire. The pension surcharge, 12.4 percent of salary, is the combined sum of the state and member contributions. The Texas Association of School Boards reports that the surcharge can cost districts up to $668 per retired-rehired employee each month. Some school districts have told the Comptroller’s office that this surcharge is hurting their attempts to retain experienced teachers.

Texas Salaries Low in National Rankings

Texas’ teacher salaries trail behind those offered in most other states.

The National Education Association’s Fall 2005 Rankings & Estimates Update ranked Texas’ average teacher salary for the 2004-05 school year at 33rd in the nation (Exhibit 7).

Average Salary for Classroom Teachers
2003-04 (Revised) and 2004-05

State or Region Average Teacher Salaries 2003-04 National Ranking 2003-04 Average Teacher Salaries 2004-05 National Ranking 2004-05 % Change from 2003-04 Rank in % Change
Connecticut $57,337 1 $58,688 1 2.4% 28
District of Columbia $57,009 2 $58,456* 2 2.5% 18
California $56,444 3 $57,876* 3 2.5% 18
Michigan $55,503* 4 $56,973* 4 2.6% 16
New Jersey $55,344* 5 $56,682* 5 2.4% 28
New York $55,181 6 $56,200 6 1.8% 35
Illinois $54,230 7 $55,629 7 2.6% 16
Massachusetts $53,733 8 $54,325 8 1.1% 44
Pennsylvania $52,590* 9 $53,258* 10 1.3% 40
Rhode Island $52,261* 10 $53,473* 9 2.3% 33
Alaska $51,736 11 $52,424 11 1.3% 40
Maryland $50,261 12 $52,331 12 4.1% 5
Delaware $49,366 13 $50,869 13 3.0% 10
Oregon $47,829 14 $48,330 15 1.0% 45
Ohio $47,482 15 $48,692* 14 2.5% 18
Georgia $45,988 16 $46,526 18 1.2% 43
Indiana $45,791 17 $46,591 17 1.7% 36
Hawaii $45,479 18 $46,149 19 1.5% 37
Washington $45,434 19 $45,724 20 0.6% 47
Minnesota $45,375 20 $46,906 16 3.4% 8
Colorado $43,319 21 $43,949 24 1.5% 37
North Carolina $43,211 22 $43,348 27 0.3% 48
Wisconsin $42,882 23 $44,299 23 3.3% 9
New Hampshire $42,689 24 $43,941 25 2.9% 12
Nevada $42,254 25 $43,394 26 2.7% 15
Vermont $42,007 26 $44,535 22 6.0% 3
Arizona $41,843* 27 $42,905* 28 2.5% 18
Virginia $41,791 28 $44,763 21 7.1% 2
South Carolina $41,162 29 $42,207* 29 2.5% 18
Idaho $41,080* 30 $42,122* 30 2.5% 18
Florida $40,604 31 $41,587 32 2.4% 28
TEXAS $40,476 32 $41,009 33 1.3% 40
Tennessee $40,318 33 $42,072 31 4.4% 4
Kentucky $40,240 34 $40,522 34 0.7% 46
Maine $39,864 35 $39,610 38 -0.6% 49
Wyoming $39,532 36 $40,392 36 2.2% 34
Arkansas $39,314* 37 $40,495* 35 3.0% 10
Utah $38,976 38 $39,965* 37 2.5% 18
Kansas $38,623 39 $39,175 42 1.4% 39
West Virginia $38,461 40 $38,360 46 -0.3% 49
Iowa $38,381 41 $39,284 41 2.4% 28
Nebraska $38,352 42 $39,456 39 2.9% 12
Alabama $38,285 43 $38,186 47 -0.3% 49
Missouri $38,006 44 $38,971* 43 2.5% 18
Louisiana $37,918 45 $38,880* 44 2.5% 18
New Mexico $37,877 46 $39,361 40 4.0% 6
Montana $37,184 47 $38,485 45 3.5% 7
Mississippi $35,684* 48 $36,590* 49 2.5% 18
North Dakota $35,441 49 $36,449 50 2.8% 14
Oklahoma $35,061 50 $37,879 48 8.0% 1
South Dakota $33,236 51 $34,040 51 2.4% 28
Average, 50 states and D.C. $46,735* $47,808*   2.3%  
*Computed from NEA Research, estimates data book. The figures are based on reports through August 2005.
Source: National Education Association (NEA), Rankings & Estimate Update, Fall 2005.

Furthermore, Texas appears to be losing ground over time (Exhibit 8).

Average Salary for Classroom Teachers, Texas vs. National Average

Year Texas Ranking* Texas Average Salary US Average Salary* Difference
1999 33 $35,041 $40,582 ($5,541)
2000 28 $37,567 $41,754 ($4,187)
2001 26 $38,361 $43,400 ($5,039)
2002 32 $39,232 $44,683 ($5,451)
2003 32 $39,974 $45,776 ($5,802)
2004 32 $40,476 $46,735 ($6,259)
2005 33 $41,009 $47,808 ($6,799)
* Includes the District of Columbia.
Source: NEA, Rankings and Estimate.

The gains Texas teachers realized from the last across-the-board pay raise in 1999 (which moved the state’s ranking from 33rd to as high as 26th in the nation) have disappeared.

While some argue that Texas’ lower-than-average cost of living may help to make up for the pay differential, the gap between the state and national averages appears to be widening. Furthermore, competition among states for highly qualified teachers is increasing. Recognizing the complexity of the issue, the Education Commission of the States’ 2005 report, Eight Question on Teacher Recruitment and Retention: What Does the Research Say?, states, “The clearest recommendation that can be made is for policymakers to ensure that teacher salaries in their state or district are comparable to neighboring states or districts.”

Dr. John Folks, who is now superintendent of the Northside ISD in San Antonio and former State Superintendent of Public Instruction for the State of Oklahoma, stated that in his experience Texas and Oklahoma have always been in competition for teachers. Oklahoma, which has recently launched a statewide campaign to increase its teacher salaries and benefits, was according to Folks, probably losing teachers to Texas primarily because some Texas districts were paying higher salaries.

Other Jobs More Attractive

All too often, Texas’ teachers find that they can earn more in other occupations.

The Texas Workforce Commission has developed an Occupation and Skill Computer-Assisted Researcher (OSCAR) system to help workers find occupations appropriate for their skills. OSCAR can be used to identify occupations that rely on the skills and training teachers possess. Based on Bureau of Labor Statistics occupational wage data, one can then calculate average salaries in these comparable occupations.

Exhibit 9 compares average salaries for nine teaching occupations to those calculated for professions employing similar “skill sets.” For each of the nine teaching occupations, OSCAR identified from 18 to 49 comparable professions, such as sales managers, service managers, wholesale and retail buyers, personnel recruiters and training, and development specialists. The exhibit then estimates the “pay gap” between an average of these professions and the various teaching roles.

Salaries in Comparable Occupations

Teacher 2004 Average Teacher Salary % Growth, Previous 5 years 2004 Salary for Comparable Occupations % Growth, Previous 5 years 2004 Teacher Pay Gap Pay Gap as % of Teacher Salary
Kindergarten Teachers, Except Special Education $40,480 17.3% $46,594 19.8% $6,114 15.1%
Elementary School Teachers, Except Special Education $42,090 19.3% $46,818 17.9% $4,728 11.2%
Special Education Teachers, Middle School $42,300 14.3% $50,338 21.5% $8,038 19.0%
Special Education Teachers, Preschool, Kindergarten, and Elementary School $42,640 16.3% $50,338 21.5% $7,698 18.1%
Special Education Teachers, Secondary School $42,650 15.8% $50,338 21.5% $7,688 18.0%
Middle School Teachers, Except Special and Vocational Education $42,680 17.4% $50,396 22.1% $7,716 18.1%
Secondary School Teachers, Except Special and Vocational Education $44,170 16.5% $50,396 22.1% $6,226 14.1%
Vocational Education Teachers, Middle School $44,540 14.4% $50,396 22.1% $5,856 13.1%
Vocational Education Teachers, Secondary School $45,850 13.2% $50,396 22.1% $4,546 9.9%
Sources: Texas Workforce Commission Career Development Resources Division and Bureau of Labor Statistics, Occupational Employment Statistics.

In 2004, depending upon the type of teacher, other Texas jobs requiring the same skills paid average salaries ranging from $4,546 to $8,038 more per year. This implies that teachers switching to another occupation requiring comparable skills could have enjoyed an average pay raise ranging from 9.9 to 19.0 percent. Moreover, in most cases this gap has increased over the past five years.

From a national perspective, teacher salary increases in terms of real dollars is not keeping pace with those of other professionals. The American Federation of Teachers’ 2004 Survey and Analysis of Teacher Salary Trends, shows that while professors, accountants, engineers and other professionals experienced real dollar salary increases of between 5 and 14 percent between 1994 and 2004, teacher salaries rose nationally by only 2.2 percent.

Some studies fault a strict comparison of teacher salaries to salaries in other professions because teachers work nine to ten months of the year and therefore the say teachers’ hourly wage is comparable. The Southern Regional Education Board’s 2000 report, Focus on Teacher Salaries: What Teacher Salary Averages Don’t Show, strongly suggests that average salary comparisons among states and among other professions should not be used as the basis for policy decisions. Rather, they suggest that the best standard for determining if teacher salaries are adequate, is whether teacher salaries are attracting and retaining the best teachers.

Tracking Teacher Turnover

Although different researchers define teacher turnover—that is, the number or share of teachers leaving their positions each year—in varying ways, several conclusions regularly emerge from their studies.

Teacher turnover is lower in schools whose students perform well and higher in schools with poor academic performance (see Exhibit 1).

Finally, teacher turnover is a much greater problem among newer teachers. Some researchers suggest that after just five years, between 30 and 40 percent of all beginning teachers have left teaching altogether. Data obtained from TEA’s Office of Educator Standards (Exhibit 10) shows that 32.5 percent of teachers who entered the profession in 2000 were gone within five years.

Teacher Retention Rates in Texas
2000 to 2004

Year Hired Retained   Retention Rate      
    1 Year 2 Years 3 Years 4 Years 5 Years
2000 No 1,641 2,746 3,680 4,419 5,198

10.12% 16.93% 22.69% 27.25% 32.05%

Yes 14,576 13,471 12,537 11,798 11,019

89.88% 83.07% 77.31% 72.75% 67.95%

Total 16,217 16,217 16,217 16,217 16,217

2001 No 1,153 2,008 2,679 3,411

9.19% 16.00% 21.35% 27.18%

Yes 11,395 10,540 9,869 9,137

90.81% 84.00% 78.65% 72.82%

Total 12,548 12,548 12,548 12,548

2002 No 1,320 2,351 3,239

  8.60% 15.32% 21.10%

Yes 14,028 12,997 12,109

  91.40% 84.68% 78.90%

Total 15,348 15,348 15,348


2003 No 1,386 2,468

8.06% 14.35%

Yes 15,808 14,726

91.94% 85.65%

Total 17,194 17,194

2004 No 1,982


Yes 19,855


Total 21,837

Source: SBEC.

TEA includes a measure of district-level teacher turnover in its Academic Excellence Indicator System (AEIS). In 2005, TEA calculated the statewide turnover rate at 16.1 percent.

Teachers often move from one school district to another, a factor that must be taken into account when considering district-level figures. Even so, the statewide TEA data suggest that more than 37,700 full time equivalent (FTE) teachers working in Texas school districts in 2004 were no longer doing so in 2005, up slightly from 37,000 in the prior year.

The schools those beginning teachers left were roughly similar to the statewide average in terms of demographics, but had more special education students and slightly more limited-English-proficient, bilingual and minority students—all fields facing greater-than-average teacher shortages. Campuses that lost beginning teachers also tended to be larger than average (Exhibit 11).

Campuses that Lost Beginning Teachers vs. State Averages, 2003-04

Spec. Ed. LEP Biling. Minority Campus Size
Campuses with Beginning Teachers Leaving 14.4% 15.7% 14.4% 62.3% 709
State Averages 11.6% 15.3% 14.1% 61.3% 551
Source: TEA PEIMS data from 2003-04 and AEIS data for 2003-04.

New Teacher Mentoring and TxBESS

Workplace demands are particularly difficult for teachers in the early years of their careers. Schools often assign veteran teachers to the most attractive schedules and the more academically gifted and “easier-to-teach” students, leaving less desirable schedules and more difficult students to newer teachers.

Given the fact that newer teachers are more likely to depart the field, mentoring and other assistance for them can be critical.

According to a brief issued in August 2005 by the Alliance for Excellent Education, the time it takes for a new teacher to perform at the same level as an experienced teacher—on average, from three to seven years—can be shortened significantly when the teacher participates in a comprehensive induction program.

Yet according to the 2005 national MetLife Survey of The American Teacher, one in five new teachers did not receive orientation assistance, such as a tour of their schools. A similar proportion (19 percent) were not assigned to or matched with an experienced mentor during their first year of teaching. Of those assigned a mentor, 16 percent did not find them helpful, meaning that a third of new teachers surveyed (32 percent) either had no mentor or had one who was not helpful.

A 2005-06 Texas Association of School Boards survey reported that 28 percent of responding districts (195 out of 702) pay stipends to teachers who act as mentors to their less-experienced counterparts. The average annual stipend reported was $447. The survey highlights noted that neither the percentage of districts paying stipends nor the average stipend changed significantly from 2004-05.

Since 1999, SBEC has guided and directed the Texas Beginning Educator Support System (TxBESS), a statewide program designed to support teachers in their first and second years on the job.

In 1999, the U.S. Department of Education funded TxBESS as a three-year pilot project, providing a $10 million Teacher Quality Enhancement Grant for the program’s development and initial implementation. In 2003, the U.S. Department of Labor and the Texas Workforce Commission provided TxBESS with an additional $3 million grant. Most recently, TEA and SBEC concluded a memorandum of understanding providing TxBESS with $700,000 over the 2004-2005 biennium to develop training programs and materials.

In 2004, SBEC reported that about 5,000 beginning teachers had been supported through TxBESS since spring 2000. According to a 2002 report by the Charles A. Dana Center, 84 percent of the first group of teachers who received assistance through TxBESS were still teaching after three years, compared to 75 percent of teachers who received other or no support. TxBESS also proved successful in retaining minority teacher and teachers across grade levels.

Since 1999 a contractor, Resources for Learning (RFL), has assisted SBEC in administering and coordinating TxBESS. Between August 2004 and August 2005, RFL provided TxBESS with project administration services, developed electronic training components for mentors, monitored education service center contracts, provided eight “train the trainer” sessions for potential mentors, and reproduced training materials for statewide distribution.

At present, however, no state or federal funds are designated for local or regional support of TxBESS. The contractor has agreed to offer “train the trainer” sessions on a fee basis for school districts, educator preparation programs, and regional education service centers.

According to officials with TxBESS, limited state involvement and funding has meant that fewer districts are aware of the program and its benefits and request services.

Why Teachers Leave

The 2005 MetLife Survey of The American Teacher studied teachers who said they were likely to leave the teaching profession within the next five years. According to the report, 12 significant factors can predict that a teacher is likely to leave the profession.

Despite the fact that pay and salary are mentioned only incidentally in the survey, note that four of the 12 factors (Exhibit 12) reference pay, resources, or funding issues. The MetLife survey also indicated that only about one in 10 (9 percent) of teachers strongly agree that they are respected in today’s society.

Portrait of a Teacher Likely to Leave in the Next Five Years

1. Not satisfied with teaching as a career
2. Feels as if their job is not valued by the supervisor
3. Feels stress and anxiety related to reviews by their supervisor
4. Feels stress and anxiety related to personal issues, union, low pay, teacher conflict, discipline, complaints and incompetence
5. Feels stress and anxiety related to unrealistic demands, workload, number of responsibilities
6. Fewer years of experience teaching
7. Minority teachers
8. Feels stress and anxiety related to safety
9. Feels stress and anxiety related to budget/lack of funding/financial constraints
10. Finds making a contribution to society a source of greatest teaching satisfaction
11. Feels stress and anxiety related to lack of resources
12. Finds pay/salary a source of greatest teaching satisfaction
Emphases added.
Source: 2004-2005 The Met Life Survey of The American Teacher: Transitions and the Role of Supportive Relationships.

In Texas, an examination of average base salaries and teacher turnover between 2002-03 and 2003-04 indicates that turnover is highest where teacher pay is lowest (Exhibit 13). (It should be noted that SBEC data on turnover includes any teacher who left a campus, whether or not he or she simply changed campuses or districts.)

Teacher Turnover at Campuses, 2003-04 through 2004-05 vs. Average Base Salary at Campuses, 2004-05

Average Base Salary 2003-04 Percent Teacher Turnover, 2004-05
Less Than $35,000 28.7%
$35,000 - $39,999 22.5%
$40,000 - $44,999 20.7%
$45,000 or More 18.9%
Average 21.7%
Sources: SBEC and TEA, AEIS.

In Texas, teacher retirements spiked in 2004. TRS reports that nearly 28,913 members retired in 2004, a 32 percent jump over 2003. According to TRS officials, roughly 85 percent of their members are public school employees. The remaining 15 percent are employees of Regional Education Service Centers, community and junior colleges, senior colleges and universities, medical and dental schools, and other state-supported educational institutions in Texas. Of those that are public school employees, TRS estimates that 50 percent are classroom teachers, meaning that about 12,300 teachers retired in 2004 compared to 9,300 in 2003.

The surge in retirements was driven by a change in federal law. Most Texas schoolteachers do not participate in Social Security, instead paying into and receiving benefits from TRS. Until 2004, however, federal law allowed teachers to receive a portion of their spouses’ Social Security benefits simply by working in a position that does participate in Social Security for as little as a single day. To qualify, their last day of employment and their retirement had to be from a government position covered by both TRS and Social Security.

According to the U.S. Government Accountability Office, thousands of Texas teachers spent their last day before retirement working for school districts as clerks or janitors, solely to claim Social Security spousal benefits and increase their retirement income. Congress closed this “spousal loophole” as of June 30, 2004.

In the 2004-05 school year, the total number of retirees fell to 13,563, bringing the average number of retirees for the two years to just over 21,000, on par with previous trends.

According to Richard Ingersoll’s September 2003 report, Is There Really a Teacher Shortage?, however, only about 25 percent of teachers leaving the profession are retiring. Teachers who leave for “personal reasons” account for more turnover than either retirement or dismissal.

Almost half of all those departing the profession cite job dissatisfaction or the desire to pursue a better job or another career. Those who depart because of job dissatisfaction most often link their departure to low salaries, lack of support from school administration, student discipline problems, poor student motivation, and a lack of influence over decision-making.

A May 2000 survey by Scholastic Inc. and the Council of Chief State School Officers found that the most effective strategies for retaining experienced teachers are:

  • better pay and administrative support;
  • an active role in decision-making;
  • more planning time with peers;
  • ongoing professional development;
  • sabbaticals for professional growth; and
  • career advancement opportunities.

III. The Demand for Teachers

Texas is failing to meet the demand for competent, qualified teachers.

Teacher shortages can be defined in several ways. In one sense, there is no shortage of Texas teachers; SBEC has reported that about 600,000 persons hold valid Texas teacher certificates—more than twice as many persons as are currently teaching in the state. The trouble, of course, is that many of these individuals simply have chosen not to teach.

SBEC’s June 2002 Defining the Teacher Shortage report to the Legislature’s Joint Committee on the State’s Shortages of Educational Professionals offered various definitions of teacher shortages ranging from zero to 56,551. The February 2006 Estimates of the Shortage of Texas Public School Teachers in 2000-01 and 2004-05 report shows that the total number of teachers without a standard certificate, which spiked sharply in 2001-02, has increased by 13 percent, whereas the number of teachers holding emergency permits has significantly declined (Exhibit 14).

Estimates of Teacher Shortages

Method Used to Estimate the Shortage of Teachers 2000-01 Shortage 2001-02 Shortage 2004-05 Shortage Change since 2000-01
I. Vacant Classrooms 0 0 0 0
II. Number of All Certified Teachers 0 0 0 0
III. Number of Teachers Not Holding a Standard Certificate 21,077 33,899 23,799 2,722
IV. Number of Teachers on Emergency Permits 14,440 14,488 1,659 -12,781
V. Number of Teacher Full-Time Equivalents (FTEs) Assigned to Teach Out-of-Field Using a Subject Level Analysis 45,155 56,551 42,264 -2,891
VI. Number of Teachers Assigned to Teach Out-of-Field More than 50 Percent of the Day Using a Subject Level Analysis 41,197 50,381 40,966 -231
Source: Estimates of the Shortage of Texas Public School Teachers in 2000-01 and 2004-05, February 6, 2006, Ed Fuller, Ph.D.

Teacher shortages are particularly pronounced in specific fields. In February 2005, TEA cited shortages in Bilingual/English as a Second Language, Science, Special Education, Foreign Languages, Mathematics, and Technology Applications.

SBEC reports that only 25 percent of all initial certificates over the past five years were issued in the areas of greatest shortages. The remaining 75 percent were issued in fields without significant teacher shortages, most notably in Elementary Education, English Language Arts, and Reading.

In a May 2004 report concerning the state’s school finance trial, noted education expert Linda Darling-Hammond, Ph.D., Stanford University, stated that the number of Texas teachers who are not certified or teaching in their area of expertise is rising. In addition, she stated that districts with large populations of low-income and minority students face the most significant shortages of appropriately certified teachers.

Enrollment Growth and Demographic Change

The demand for teachers in Texas public schools is being driven by steady enrollment growth. The student population has been rising by nearly 2 percent annually since 2000, for an average increase of 75,000 to 80,000 students per year (Exhibit 15). Based on an average Texas class size of about 15 students per teacher, this implies a need for about 5,000 new teachers each year.

Texas Student Enrollment Growth
1998-99 to 2004-05 School Years

School Year Enrollment Annual Growth % Change
2004-05 4,383,871 72,369 1.7%
2003-04 4,311,502 71,591 1.7%
2002-03 4,239,911 93,258 2.2%
2001-02 4,146,653 87,034 2.1%
2000-01 4,059,619 67,836 1.7%
1999-2000 3,991,783 46,416 1.2%
1998-99 3,945,367    
Growth 1999 to 2005
438,504 11.1%
Average Growth Per Year Since 1998-99 73,084 1.8%
Average Growth Per Year, Last 5 Years 78,418 1.9%
Source: TEA, AEIS.

Between the 1998-99 and 2004-05 school years, the Texas student population rose by 11.1 percent. The number of students served by some special programs, however, rose even faster. Over this period, the number of students in Bilingual/English as a Second Language programs rose by 31.8 percent, while the economically disadvantaged student population increased by 25.0 percent. The special education population grew by 6.2 percent (Exhibit 16).

Special Population Student Enrollment Growth
1998-99 to 2004-05 School Years

Special Populations 1998-99 2004-05 % Increase
Bilingual/ESL 479,040 631,534 31.8%
Economically Disadvantaged 1,914,547 2,394,001 25.0%
Special Education 476,712 506,391 6.2%
Source: TEA, AEIS.

Special populations such as these represent a greater challenge for educators, who must possess more complex skills and training to meet their needs.

Between 1998-99 and 2004-05, student population growth varied by grade level. The most dramatic increase occurred in the earliest grades, due in part to the expansion of the Head Start Program and other preschool efforts. The later high school grades expanded rapidly as well. Enrollment in the primary and middle grades grew more slowly and at roughly the same pace (Exhibit 17).

Student Enrollment Growth by Grade Level
1998-99 to 2004-05 School Years

Grade Level 1998-99 % of Total 2004-05 % of Total % Increase 1999 to 2005
Early Education 13,869 0.4% 14,355 0.3% 3.5%
Pre-Kindergarten 123,076 3.1% 175,633 4.0% 42.7%
Kindergarten 290,432 7.4% 333,530 7.6% 14.8%
Grade 1 318,863 8.1% 345,464 7.9% 8.3%
Grade 2 309,313 7.8% 333,959 7.6% 8.0%
Grade 3 307,892 7.8% 326,753 7.5% 6.1%
Grade 4 301,475 7.6% 324,221 7.4% 7.5%
Grade 5 299,362 7.6% 323,492 7.4% 8.1%
Grade 6 300,246 7.6% 328,582 7.5% 9.4%
Grade 7 303,921 7.7% 332,830 7.6% 9.5%
Grade 8 299,760 7.6% 329,003 7.5% 9.8%
Grade 9 350,743 8.9% 383,353 8.7% 9.3%
Grade 10 273,161 6.9% 311,018 7.1% 13.9%
Grade 11 240,751 6.1% 274,815 6.3% 14.1%
Grade 12 212,503 5.4% 246,863 5.6% 16.2%
Total 3,945,367   4,383,871   11.1%
Source: TEA, AEIS.

Highly qualified teachers for the early grades are critical because the pre-reading and math skills learned there are key predictors of later student success. Qualified middle and high school teachers are vital as well, of course, since they improve the likelihood that their students will complete their educations and go on to post-secondary institutions.

Filling Teaching Vacancies

Texas’ current teacher preparation programs are not meeting the state’s demand for new teachers.

As noted in Exhibit 6, alternative, baccalaureate and post-baccalaureate programs produced 21,991 initially certified Texas teachers in 2005. In the same year, however, about 37,700 full-time equivalent public school teachers who were employed in 2004 did not return.

The 2003 legislative session saw attempts to remove what some perceive as barriers to entry into the teaching profession, in the form of legislation that would allow college graduates with no teacher training to teach grades 8-12. The legislation failed, but in April 2004, SBEC instituted a similar program by rule. At this writing, though, the program has attracted only one new teacher to the profession since its inception.

On the local level, many districts pay salaries far in excess of the minimum salary schedule to recruit, reward, and retain qualified teachers, particularly in areas of critical shortages. Fifty-three percent of respondents to the 2005-06 Texas Association of School Boards survey (representing 702 school districts) reported paying “shortage stipends” to teachers in at least one critical shortage area. This share was up from 45 percent in 2003-04, and 50 percent in 2004-05. Shortage stipends are additional annual payments made to teachers working in fields designated by the commissioner of Education as critical shortage areas, such as math, special education, and bilingual education.

Bilingual education was the area most commonly reported as receiving stipends, with 56 percent (208 districts) offering teachers stipends in this area. It was also the area receiving the largest stipends, averaging $2,253 annually. Shortage stipends are particularly common in large districts; 87 percent of responding districts with more than 10,000 students reported offering stipends.

Some school districts have resorted to extensive measures to reduce teacher turnover. In 2001, the Dallas Independent School District (DISD) enacted a program to attract and retain qualified teachers that included increasing the beginning teacher salary from $34,000 to $37,000; offering a sign-on bonus for new hires; adding a $500 annual English as a second language (ESL) stipend; and providing $250 annually to every teacher for supplies.

Today, the beginning teacher salary in DISD is $39,150 and new hire incentives range from $250 to $1,000, with bonuses in the areas of Bilingual, Math, Science, Special Education and Early Childhood of $500. Stipends are granted for Bilingual ($3,000), Math and Science ($1,000), ESL, Spanish, Special Education ($500), and Dual Certification ($1,500). And, $250 is still given to each teacher for supplies.

As a result of this intensive recruitment effort, DISD began 2004-05 with only 18 critical teacher vacancies, compared to 150 in 2001-02 and 259 in 1999-2000. For 2005-06, the district began the year with 40 critical teaching vacancies, up slightly from the previous year due to increased enrollment resulting from Hurricane Katrina evacuees and students entering the district as a result of the annexation of the Wilmer-Hutchins ISD, a troubled neighboring district.

DISD’s research on teacher retention also resulted in a recommendation for “increased support for teachers who need intensive assistance to develop teaching skills.” From this recommendation an intensive assistance component was designed and implemented in the fall of 2002. Called T3: Teachers Teaching Teachers, the focus of this program is supporting, assisting, training, and equipping beginning teachers with the skills to become a highly effective teacher. Officials said DISD not only needed to retain new teachers because it was costing them an estimated $14,000 for each teacher lost, but they were also concerned about making each teacher an effective contributing factor in each child’s personal achievement.

During summer 2002, the New Teacher Support and Development Department hired ten (seven elementary level and 3 three secondary level) master teachers to serve as Instructional Coaches for beginning teachers who have been identified as needing intensive assistance by the campus’ New Teacher Support Team. Dallas officials indicated that this program has been well-received. Surveys of new teachers, principals, and campus-based mentors indicate that from 96 to 100 percent of participants gave the program high marks.

During a 2000 school performance review of Galveston ISD, the Comptroller found that recruiting and retaining teachers was one of the biggest challenges the district faced, a difficulty that had begun to affect student performance. By raising its salaries and making a commitment to remain competitive in the marketplace, the GISD board significantly improved its position. At the end of 2000-01, fewer than 40 vacancies existed, versus a previous average of 100 vacancies per year.

GISD Human Resource personnel told Comptroller staff that early approval of the 2000-01 salary schedule improved the district’s recruitment efforts so much so that neighboring districts complained that GISD was attracting candidates away from them.

Other States

According to a December 2005 report from the Southern Regional Education Board, an organization representing 16 southern states, most of its member states are actively attempting to raise teacher salaries as a means of recruiting and retaining qualified teachers.

For the 2005-06 school year, Mississippi teachers are receiving increases averaging 8 percent as the final part of a five-year plan to raise teacher pay. The Alabama legislature included increases for 2005-06 averaging 6 percent.

The first step of an Oklahoma plan funded in 2004-05 extended health insurance benefits to teachers for the first time. In 2005, Oklahoma funded the second step of a five-year plan to increase teacher compensation to the average of its bordering states. According to the plan, in the next three years, teacher salaries will continue to rise. Arkansas authorized a pay increase for 2006-07. In West Virginia the Legislature authorized $1,350 raises for all teachers in 2005-06. State budgets in Delaware, Georgia, Kentucky, North Carolina, Tennessee, and Virginia included raises of 2 to 3 percent for 2005-06.

In addition to pay raises, Georgia has created two new incentive programs to encourage teachers to enter or stay in the classroom: the Georgia Master Teacher Program and the Academic Coach Program. The Master Teacher Program will certify teachers with three or more years of experience who display excellence in the classroom as a Master Teacher. The Academic Coach Program will allow Master Teachers who wish to remain classroom teachers throughout their careers to receive salary supplements or bonuses in exchange for mentoring other teachers.

In 2005, Louisiana amended and clarified provisions of the Louisiana Teachers’ Homebuyers Program. In addition to special mortgage loans, the program now provides assistance with closing costs to encourage qualified teachers to teach in low-performing schools in areas of the state with teacher shortages. Arkansas, which also has a Teacher Housing Development Act to attract teachers to low-performing districts, appropriated funds in 2005 for the operation of a foundation authorized to accept public and private funding to support housing assistance.

IV. Cost of Teacher Turnover

Texas’ inability to maintain a stable, qualified teaching work force imposes direct costs both on school districts, which must foot the bill for recruiting and training replacements, and the state, which suffers a financial loss each time a teacher candidate prepared by Texas programs chooses not to pursue teaching as a career or to leave the profession after a short time.

Local Costs

Replacing a departing teacher requires the district to post job openings, interview candidates, and establish new hires in district accounting systems. Less-obvious expenses include advertising, recruiter fees, background and reference checks, and signing bonuses, exit interviews, paperwork processing and payments for accumulated leave, as well as any overtime costs incurred by other employees during the hiring process.

In addition, the loss of experienced teachers inevitably disrupts school operations. New teachers must be given preliminary training, and should be mentored and monitored closely. Some estimate that it takes at least a year for a new teacher to become acclimated and the school’s general routine restored, and when teachers leave during the middle of the school year, the resulting disruptions are even greater. Although difficult to quantify, productivity losses represent a real cost as well.

SBEC’s November 2000 report, The Cost of Teacher Turnover, assessed methods used to determine teacher turnover costs. To estimate these costs for 2004-05, the Comptroller’s office has used the most conservative method outlined in the study and updated it to reflect teacher turnover and average salaries for 2004-05.

SBEC’s method assumes that the average cost of teacher turnover is 25 percent of salary and benefits, based on three national models of turnover costs developed by recognized experts. The average teacher salary reported by TEA’s AEIS for 2004-05 was $41,011 and average benefits, estimated at 30 percent of salary, were $12,303, for a total average of $53,314 per teacher. Based on the most conservative method, the cost of 2004-05 turnover is estimated at $13,329 per teacher.

About 37,700 full-time equivalent (FTE) public school teachers did not return in 2005. At a cost of $13,329 per FTE, that implies a total 2004-05 cost for teacher turnover of $502.5 million.

State Costs

Direct state costs associated with educating new teachers consist primarily of formula funding for higher education institutions and financial aid for students attending them.

The estimated direct state cost for educating new teachers—for an average of four years per student for the traditional route to certification, and five years for the post-baccalaureate route—is $147.2 million annually, based on fiscal 2003 estimates of costs associated with undergraduate students at public colleges and universities and the number of new teachers certified in Texas. (Not included in this estimate are state funds for capital improvements and other fixed costs related to state university operations.)

Because 27 percent of teachers certified by the traditional route and 33 percent of those certified by the post-baccalaureate route are no longer working in the classroom five years after certification, the cost to the state for educating teachers who subsequently leave the profession is estimated to be at least $42.4 million per year, based on fiscal 2003 numbers (Exhibit 18).

Annual Higher Education Cost Estimate for New Teachers, 2004

Certification Route Numbers
Certified by traditional route 8,586
Post-baccalaureate route 3,505
Total teachers certified 12,091
FY 2004 cost per student* x 4 $11,348
Total estimated state cost for teacher training $147.2 million
Total Cost for educating teachers no longer in the classroom five years later $42.4 million
*THECB estimated 2003 annual state cost per undergraduate student for one year was $2,837, based on fiscal 2003 data.
Sources: Texas Comptroller Carole Keeton Strayhorn, using data from THECB and SBEC.

In addition, because THECB reports that only about 60 percent of college students graduate, the cost to the state could be significantly higher.

Dropout Costs

According to the 2000 federal Census, nearly 25 percent of Texans aged 25 and older lacked a high school diploma—nearly 5 percentage points behind the national average (Exhibit 19).

Texas and National Educational Attainment, 2000

  Texas Population Texas % of Total National % of Total
Population 25 years and over 12,790,893    
Education: less than 9th grade 1,465,420 11.5% 7.5%
9th to 12th grade, no diploma 1,649,141 12.9 12.1
Total population with no diploma
24.4 19.6
High school graduate (includes equivalency) 3,176,743 24.8 28.6
Some college, no degree 2,858,802 22.4 21
Associate degree 668,494 5.2 6.3
Bachelor’s degree 1,996,250 15.6 15.5
Graduate or professional degree 976,043 7.6 8.9
Percent high school graduate or higher
75.7 80.4
Percent bachelor’s degree or higher
23.2 24.4
Source: U.S. Census Bureau, DP-2, Profile of Selected Social Characteristics: 2000.

Some improvement can be seen in the Census Bureau’s 2004 Current Population Survey (Exhibit 20). Even so, Texas remained dead last among the 50 states in its share of residents aged 25 or older with a high school diploma, and ranked 35th in the nation in its percent of population with a bachelor’s degree or higher.

2004 Current Population Survey Data

Texas % of Total National % of Total
Percent high school graduate or higher 78.3 85.2
Percent bachelor’s degree or higher 24.5 27.7
Source: U.S. Census Bureau, Current Population Survey, Tables 10 & 13, March 2004.

The National Center for Education Statistics (NCES) reports that 40,000 to 50,000 students drop out of Texas public schools each year. This is a far higher number than the 15,000 to 20,000 reported each year by the TEA, but TEA’s figures have been the subject of considerable controversy. The 2003 Legislature responded to ongoing concerns about TEA’s dropout methodology with the passage of Senate Bill 186, which requires the agency to use NCES definitions and methods to calculate dropout rates beginning in 2005-06.

Regardless of this controversy, though, the magnitude of the problem can be seen clearly in the attrition rates of Texas public high schools—that is, the numeric or percentage change in enrollment between successive grades. Attrition rates provide a simple measure of students who leave school over time, without regard to their reasons.

Exhibit 21 presents data provided by TEA in a 2005 report.

Enrollment and Attrition Rate, Grade 9-12, by Student Group
Texas Public Schools, 2004

Group Enrollment Grade 9
Enrollment Grade 12
Change Attrition Rate
African American 54,241 32,781 21,460 39.6%
Asian/Pacific Islander 8,825 8,384 441 5.0
Hispanic 145,608 85,062 60,546 41.6
Native American 1,027 708 319 31.1
White 151,158 116,368 34,788 23.0
Economically Disadvantaged 153,149 80,650 72,499 47.3
State 360,857 243,303 117,554 32.6%
Source: TEA, Secondary School Completion and Dropouts in Texas Public Schools 2003-04, August 2005.

As indicated in Exhibit 21, nearly a third of Texas students enrolled in Grade 9 in 2000-01 were no longer enrolled by what should have been their senior year. Texas enrollment is growing by nearly 2 percent per year, so the sharp decline in net enrollment in the upper grades could mean that the actual attrition rate is even higher.

These “missing” 117,554 students may not be dropouts as defined by TEA or NCES, but the precipitous decline nevertheless puts the magnitude of Texas’ problem into perspective.

In 2005, Education Week ranked Texas 34th in the nation in Class of 2002 graduation rates, at 68 percent.

Why Do They Leave School?

Unsurprisingly, dropouts often have a history of poor academic achievement.

TEA’s August 2005 report, Secondary School Completion and Dropouts, 2003-04, cited students’ reasons for dropping out as reported by school districts. Districts provided no reason for 60.7 percent of official dropouts, which may indicate that many of them could not be located. Among the reasons cited, however, academic performance was by far the most common, at 55.6 percent (Exhibit 22).

Exit Reasons Reported for Official Dropouts, Grades 7-12
2003-04 School Year

Reason Number of Dropouts Percent of Total Percent of Total with Reasons Given
Because of academic performance 3,590 21.8% 55.6%
To pursue a job 1,247 7.6% 19.3%
Because of age 867 5.3% 13.4%
To get married 305 1.9% 4.7%
Because of pregnancy 298 1.8% 4.6%
Because of homelessness 73 0.4% 1.1%
Expelled and had not returned 37 0.2% 0.6%
To join the military 27 0.2% 0.4%
Because of drug abuse 10 0.1% 0.2%
No reason provided 9,980 60.7% -
State 16,434 100.0% -
Source: TEA, Secondary School Completion and Dropouts in Texas Public Schools 2003-04, August 2005.

Note that the third most-common reason was age. Overage students most likely are those who were held back in school for academic reasons.

National studies also support academic performance as the primary reason for dropping out of school. A February 2002 report from the federal Government Accounting Office, for instance, cited academic failure as a chief contributor to the likelihood of dropping out.

The Economic Cost of Dropouts

The fact that the quality of teaching affects students’ likelihood of dropping out has enormous implications for the Texas economy, involving continuing and substantial costs.

For one thing, dropouts earn much less than high school graduates. A Comptroller update of a recent Census Bureau study indicates that after accounting for inflation, an average worker who has not completed high school will earn $847,053 (in real 2003 dollars) over a 40-year working career (from age 25 to 64), while the average high school graduate will earn $1,146,144, $299,092, or 35.3 percent more.

Men’s gain from a high school degree is $403,902, or 39.5 percent more. The differential for women is even greater in percentage terms, at $260,771, or 44.3 percent (Exhibit 23).

Estimated Lifetime Earnings Gain from a High School Degree *
(All Workers, 40-Year Work History)

Group No High School Degree High School Graduate Gain (Real 03$) % Gain
All Workers $847,053 $1,146,144 $299,092 35.3%
Men $1,023,530 $1,427,432 $403,902 39.5%
Women $588,397 $849,168 $260,771 44.3%
* Census Bureau lifetime earnings estimates (real 1999 dollars) updated to real 2003 dollars using Consumer Price Index-All Urban Consumers.
Sources: U.S. Census Bureau and Texas Comptroller Carole Keeton Strayhorn.

The most recent dropout statistics reported by NCES—widely considered the most accurate available—indicate that 42,949 students in grades 9-12 dropped out of Texas high schools during the 2001-02 school year. This figure can be combined with the above lifetime earnings estimates and other data to estimate the annual cost of high school dropouts to the Texas economy.

Two adjustments must be made. First, because much of the earnings gained from completing high school (and any other degree) reflect higher intelligence, ability, or socioeconomic status rather than actual knowledge gained in high school, these estimates must be adjusted by an “alpha factor” measuring the share of the earnings gain due solely to educational attainment. In preparing the Comptroller’s higher education study of February 2005, analysts used alpha factors ranging from 65 percent for a one-year community college certificate to 90 percent for doctoral and professional degrees. These analysts estimated the alpha factor for a high school diploma at 60 percent.

Second, since not all high school graduates end up working, the estimate also must be adjusted by the appropriate employment rate. Based on the U.S. Census Bureau Current Population Surveys for 2003, 2004, and 2005, the employment rate for high school graduates in Texas is 77.8 percent for men and 59.7 percent for women.

After multiplying the number of male and female dropouts by the estimated lifetime earning loss ($403,902 for men and $260,771 for women), and applying adjustments for the “alpha factor” and average employment rates, the total lifetime wage loss for Texas high school dropouts can be estimated at about $6.3 billion annually.

But this tells only part of the story. Since lower wages are almost always associated with lower productivity and economic output, this wage loss estimate can be translated into an overall impact on Texas’ economic output. According to the U.S. Bureau of Economic Analysis, in 2003 (most recent consistent data available) worker earnings accounted for about 53.9 percent of the Texas gross state product.

Thus, dividing our annual $6.3 billion wage loss by 53.9 percent indicates that each year’s high school dropouts will directly reduce Texas economic output by about $11.8 billion over the next 40 years (Exhibit 24).

Estimated Cost of High School Dropouts to the Texas Economy

2001-02 School Year Annual Dropouts Lifetime Wage Loss (Real 03$) Education/Ability Share Employment Rate Total Lost Wages ($Billions) Total Lost GSP ($Billions)
Male 24,430 $403,902 60.0% 77.8% $4.6 $8.6
Female 18,519 $260,771 60.0% 59.7% $1.7 $3.2
Total 42,949 $342,186 60.0% 70.0% $6.3 $11.8
Sources: NCES, U.S. Bureau of the Census and Texas Comptroller Carole Keeton Strayhorn.

This process, moreover, is cumulative. Every additional year of dropouts increases the long-term cost on the Texas economy. Ten years of dropouts at the current rate, for example, would cost Texas $118 billion in long-term economic output, 20 years would cost it $236 billion and so on.

Clearly, educational failures exact an enormous and growing price from society as a whole.

Public Assistance Costs

In addition to lost economic output, dropouts also entail significantly higher costs for various government programs, including criminal justice and public assistance.

Texas Department of Criminal Justice data from 2005 indicate that Texas dropouts are 7.6 times more likely to be incarcerated than high school graduates. If Texas dropouts in 2005 had been incarcerated at the same rate as high school graduates, 87,978 fewer persons would have been in Texas prisons. Based on the Criminal Justice Policy Council’s estimated cost of $40.06 per day to incarcerate prisoners in fiscal 2004, an additional 87,978 prisoners cost the state and federal governments nearly $1.29 billion annually.

As with the calculations concerning income effects, completion of high school (and any other degree) may tend to reflect higher intelligence, ability, or socioeconomic status rather than the actual knowledge gained in high school. Again, gains attributable to completing high school must be adjusted by an “alpha factor,” reflecting behavioral change due solely to educational attainment. As already noted, the Comptroller’s office estimates the alpha factor for a high school degree at 60 percent.

Accordingly, the additional costs of incarceration that might be avoided through lower dropout rates are assumed to be 60 percent of the theoretical total, or $771.8 million.

High school dropouts also are three times more likely to receive Temporary Assistance for Needy Families (TANF) than high school graduates, and four times more likely to receive food stamp assistance.

If persons without a high school degree were represented in the main TANF caseload at the same rate as those with a degree, TANF would have served 27,385 fewer Texas cases in 2005, for a total cost of $50.1 million that could have been avoided. If the same pattern held for the food stamp caseload, Texas would have had 381,736 fewer food stamp cases in 2005, representing a total avoidable cost to the state and federal governments of $1.03 billion.

After adjusting both of these costs by the “alpha factor,” the estimated annual effects are $30.1 million in TANF expenditures and $619.5 million in food stamp spending.

Exhibit 25 reports the grand total for all costs discussed in this report.

Economic Impact of Texas Teacher Shortages
(Amounts in millions)

Teacher Turnover Cost to Federal, State and Local Governments
Element Annual Cost
Cost to School Districts to Recruit, Hire and Train New Teachers When Teachers Leave the Profession $502.5
Cost to State for Higher Education Investment Lost When Teachers Leave the Profession $42.4
Economic Cost of Dropouts
Element Annual Cost
Reduction in Economic Output $11,800.0
Cost to State and Federal Governments for Public Assistance to Dropouts
Element Annual Cost
Incarceration Costs $771.8
Temporary Assistance for Needy Families (TANF) $30.1
Food Stamps $619.5
Element Annual Cost
Total Costs $13,766.3


Teacher salaries in Texas are low, and have contributed to continuing shortages of high-quality, seasoned teachers. In their absence, student performance suffers and the likelihood of students dropping out increases. Student dropouts and poorly educated workers have a tremendous negative impact on the state’s economy and the cumulative effect over time could be catastrophic.

If new dollars are to be directed to Texas public schools, it is imperative that they be directed to attract and retain the best teachers to the classrooms offering the greatest potential for improved student performance.

Adequate pay, a system of support for new or struggling teachers, and incentives for top-performing teachers who work in schools with hard-to-educate populations would result in an expanded pool of applicants to fill vacancies, reduce turnover rates, increase the supply of higher-quality teachers, improve student performance, and provide a host of economic benefits to the state.


A. State law should be amended to immediately grant teachers a state-funded across-the-board $4,000 annual pay increase.

The increase for fiscal 2007 should be provided to every teacher, including all employee categories covered by the minimum teacher salary schedule, regardless of their years of service and in addition to any local supplements currently paid above the state’s minimum salary schedule. This raise should position Texas at or near the mid-point nationally.

B. The state’s minimum salary schedule should be restated as a formula based in part on the average national teacher salary, and through this formula, biennial increases should be made to the minimum salary schedule and fully funded by the state to maintain average teacher salaries at or near the mid-point nationally.

A biennial competitive salary schedule adjustment mechanism should be implemented that automatically adjusts the teacher salary schedule every two years. Fully funding the increases will insure that districts actually give teachers those increases, and in doing so would allow Texas to remain at or near the mid-point nationally.

C. The state should appropriate additional monies to fully fund mentoring programs and to fully fund stipends for quality, certified teachers who serve as mentors to new teachers as they enter the profession.

Neither federal nor state funds are currently supporting the TxBESS program, which has had a significant impact on teacher retention in the early years. State dollars should be dedicated to supporting and expanding the TxBESS program so that all new teachers have access to high quality mentoring support.

D. State law should be amended to pay bonuses to all teachers at schools that raise their ratings under the Texas Public School Accountability System from Academically Unacceptable to Acceptable.

All teachers in a school that achieves this improvement should receive a bonus of $2,500 each.

E. Immediately restore full state-funded health care supplements for all educators.

Fully restore the health care supplements for teachers and all educators that were cut in 2003.

F. Bring educators, financial professionals and representatives from Texas Teacher Retirement System and Employee Retirement System to the table to examine disparities between the retirement systems.

Although each retirement system represents a unique group of state employees, with unique needs, the state has an obligation to insure that all employees are treated fairly and equitably.

Fiscal Impacts

Recommendation A would cost the state an estimated $1.4 billion during the 2007 fiscal year, based upon a $4,000 salary increase plus the state’s contribution to the Teacher Retirement System, for approximately 320,000 teachers, librarians, counselors and nurses impacted by the minimum teacher salary schedule. Any final implications will depend on the method used in the funding formulas to deliver the raise to all teachers. Growth in the student population and the number of teachers would cause this number to increase by about $28 million each year thereafter.

Recommendation B would cost the state an estimated $296 million in fiscal 2008, based upon an estimated average teacher salary of $45,009 after the initial $4,000 pay raises for approximately 326,000 teachers, librarians, counselors and nurses. However, after the first year the amount of the increase would depend entirely upon national salary statistics and the amount needed to maintain Texas teacher salaries at or near the national mid-point, and therefore cannot be estimated at this time.

Recommendation C would cost the state $61.2 million annually; assuming that 23,000 first-year teachers will enter the workforce each year. This estimate not only includes dollars for teacher stipends, but also release time, training, and costs to the Texas Education Agency for administering the program. Assuming this program is successful, there would be declining need for funding in the future.

Recommendation D If all of the 264 campuses currently rated academically unacceptable were brought up to acceptable status the one-time cost to the state would be an estimated $26.4 million.

Recommendation E would cost the state an estimated $337 million more than currently budgeted in fiscal 2007 based on $1,000 per year. An estimated 612,000 school employees would be eligible for the program. Growth in the student population and the number of employees will cause this number to increase by about $14 million each year thereafter.

Recommendation F would have no appreciable cost to the state.