Teacher Pensions Blog

Glass ceilings aren't limited to the workplace, unfortunately. Because most states offer teacher retirement benefits based on their salary, states are extending the gender wage gap into retirement. Here's how.

The majority of teachers (76 percent) are female. The majority of superintendents (about 75 percent), however, are male. A recent Education Week piece dives into the reasoning behind this discrepancy, but rather than dig into the barriers female school leaders face, let's look specifically at the retirement issue. 

Most states enroll all educators--teachers, principals, and superintendents--into one state pension plan, and it's usually named the "teacher" plan. But the largest payouts from "teacher" pension systems aren't actually going to teachers, the majority of which are female. Instead, the biggest winners are long-serving, highly paid administrators, who are predominantly male. 

In 2014, we covered the release of the Empire Center's New York state pension database; the site lists the pension and services years of every current recipient.  We found that, despite its name, the New York State Teachers' Retirement System (NYSTRS) writes its largest pension checks to administrators -- not teachers. In 2014, 14 out of the 15 highest retirement payments (ranging from $220,000 to more than $300,000 per year) went to former superintendents. The remaining top spot went to a research professor. Not one of the 15 retired as a school teacher, and all but one were men. 

Not much has changed in 2016. Using the updated database, we examined the top 15 pensioners and found that 14 of them are former superintendents -- that research professor is still the lone standout. Two more women joined the mix though, bringing our total to three out of 15.

The NYSTRS benefit calculations explain why administrators are so heavily favored. NYSTRS maximum benefits are calculated using the following formula: Pension Factor x Age Factor (if applicable) x Final Average Salary = Maximum Annual Pension. The pension factor represents years of service, the age factor allows for a possible reduction should a member choose to retire early, and the final average salary is derived from a member's highest three or five consecutive school year salaries, depending on when he or she enrolled. Administrators (who are disproportinately male) out earn teachers; their average final salaries are much higher, leaving them ahead not only during their working years, but into retirement as well. The predominantly female teacher workforce is paying into the same system -- but getting far less. And unlike a system like Social Security, which awards lower-paid workers with proportionately higher retirement benefits, teacher pension systems include no such protections. 

The chart below shows NYSTRS's gender breakdown. There are 204,184 actively enrolled females versus 63,351 men. Additionally, there are about twice as many female retirees as males, suggesting that males may be more likely to eventually draw any pension at all. But while the system is comprised mostly of female members, the system's biggest beneficiaries are overwhelmingly male.


New York's gender discrepancies are a product of the state's pension plan, not some fluke. They are simply one byproduct of a system that creates a small group of pension winners at the expense of the majority of employees who lose out under pension systems -- in New York, 60 percent of new teachers will not qualify for any pension at all (let alone a generous one). Pensions are often billed as especially beneficial to women -- and, if a teacher were to spend the entirety of her career, 25-30 years, in the same system, she would earn a comfortable retirement. But we know that this isn't the case for the majority of teachers. All teachers, especially those who have been historically underpaid, deserve a fair, portable retirement plan.