For some professions, it’s all about: “location, location, location.” For online start-ups, you probably want to be in Silicon Valley. If you want to work on the stock market, head to New York City. But for teachers, where you work doesn’t matter, right?
According to WalletHub’s recent analysis, there is significant variation in teacher job quality from state-to-state.
But WalletHub’s rankings shouldn’t be taken at face value. And, as with any aggregate state ranking, the devil is in the details. About 14 percent of their total Job Opportunity & Completion Rank is based on the cost-adjusted “average” teacher pension in each state.
That’s a big problem. Averages can easily distort what’s actually going on.
Evaluating teacher retirement systems based on the average pension is misleading, because the majority of teachers do not even receive a pension. In Washington, D.C., for example, the average teacher pension is extremely high at almost $65,000, but only 29 percent of teachers ever qualify for a pension. So rating D.C.’s pension system on the average benefit of those who remain misrepresents the retirement realities teachers face. Simply put, a state’s average pension value does not provide much useful information about the quality of teachers’ retirement.
There are a couple of ways WalletHub could have evaluated state pension systems more effectively. For example, they could have used a vesting rate. This would grade states on the percentage of teachers that actually qualify for a pension. But even that won’t address other important concerns, such as whether teacher retirement benefits are portable or whether a state’s pension system is financially stable.
In WalletHub’s defense, teacher pensions are complicated. In fact, this points to a larger problem: teachers often lack sufficient information about their retirement. What is the vesting period? Do I qualify for Social Security? What is the retirement age?
Shirley Ben-Ami was a teacher for nearly 35 years. She taught fourteen and half years in the New York City Public Schools and spent the last 20 years in Montgomery County, Maryland. In the following interview Ms. Ben-Ami talks about her experiences in the classroom and when it was time for her to retire.
If states and districts consider funding teacher retirements as separate from their investments in K-12 education, it becomes much easier for legislators and governors to kick the funding liabilities down the road and leave them for others to sort out. It also creates the odd situation like the one we see in Maryland in which the state is both raising and cutting education funding.
How do we get more STEM teachers? One idea is to convince folks leaving a STEM job to start a second career in the classroom. But, career-changers, particularly in STEM fields, would most likely have to accept both a significant pay cut and lower retirement benefits. This happens because these individuals will have two separate retirement saving plans. And, unfortunately, they will be unlikely to realize the full benefits of either.