Pensions provide us with more than just financial data. While retirement systems collect crucial information on investments, salaries, and retiree wealth, they also provides us with key information about the characteristics of the teaching workforce: the expected number of teachers remaining in the classroom versus the number of teachers leaving the profession. In other words, pensions give us a snapshot of teacher retention.
Furthermore, not only do states and districts publicly release retirement data for the current fiscal year, actuarial reports are released annually and reach back for decades, and in many cases even more.
As a case example, let’s take a look at New York City. As Chad Aldeman discussed in a previous blog post, currently, half of all New York City teachers will not reach ten years of service. I used the same methodology to calculate the historical retention rates for New York City teachers from 95 years ago. The table below shows the retention rates of teachers from 1917 in comparison to retention rates in 2012.
The biggest dip in retention follows for teachers remaining after five years. In 1917 three-quarters of teachers remained after 5 years, compared to half of teachers remaining after 5 years today. Retention similarly dips at the 10 year mark of teaching from 1917 to 2012. New York City teachers today do not remain in the profession as long as they did 95 years ago.
Pensions systems have been often described as anachronistic and unfit for the current labor force. The pensions system has been in operation since 1894 in New York City. The original New York City Teacher Fund was established in 1905, and after becoming insolvent and declaring bankruptcy, was re-organized and replaced by the Teachers’ Retirement System of the City of New York. Today, a teacher in New York City must stay in the classroom for at least 10 years to receive a minimum pension. But as the data shows, only a small percentage of teachers today will actually stay long enough to meet pension requirements. More teachers are moving across jurisdictions or out of the profession altogether. New York City teachers have become more mobile, while their pension plans have not. What was established over a century ago may no longer fit the demands of today’s transient labor force.
The New York City actuarial reports, and similar historical pension data, can help researchers better understand the original design of the pension system as well as track shifts in teacher retention. In turn, we can get a fuller picture of the teaching labor force and how it has evolved over time.
*All assumptions rates are based on 25-year-old female teachers. Retention data was also collected from the 1918 and 1919 Teachers’ Retirement System of the City of New York annual financial reports, and showed similar trends as the 1917 retention rates. The reports have been digitized by Google and can be accessed from the Hathi Trust Digital Library.