Rising Retirement Costs Are Hurting Public Schools

The Facts

  • Many teachers have gone years without a raise, and others have seen their benefits reduced.
  • Administrators, meanwhile, have struggled to ensure that students have the textbooks, computers, and other materials they need to excel in the classroom.

Districts have less money to spend on other budget priorities

Public school districts have been hit especially hard by rising retirement costs. Districts now spend more than $1,000 per pupil on pension costs—up from $500 per pupil in the mid-2000s. And as schools have been forced to devote a greater share of their budgets to covering pensions, they’ve been left with less to spend on supplies, technology, and teachers’ salaries. Many teachers have gone years without a raise, and others have seen their benefits reduced. Administrators, meanwhile, have struggled to ensure that students have the textbooks, computers, and other materials they need to excel in the classroom.

It’s important to note that teachers pay their fair share. Unfunded liabilities—rather than benefits for current employees—are the primary driver of school districts’ growing employment costs, and today’s workers and students are being penalized for a problem they didn’t create. For every $10 states and school districts contribute to teacher pension plans, about $7 goes toward paying down debt. Without this burden, districts could afford to give every teacher in the country a 12 percent raise or to hire more than 500,000 new teachers nationwide. Instead, teachers and taxpayers must pay for politicians’ past mistakes—in many cases at the expense of a high-quality education for students. The success of our schools is integral to the success of our communities, and districts must take prudent steps to address their pension problems.