Overview of Teacher's Salary Increases for Fiscal Years 2007-2011

The following is an in-depth examination of annual salary increases for District 203 teachers, an explanation of the various components that make up their salary, the effects turnover has on the actual costs borne by residents and a comparison to the national Employment Cost Index.  We thank Dave Zager, District 203 Asst. Superintendent for Finance, for providing the numerical data and the answers in the Q&A. for this document.

 

Over the years some have complained about teachers receiving raises that are larger than increases in CPI. It is correct that teachers over their career typically receive increases that are larger than CPI, as do most of us. If we all spent out career only receiving increases based on CPI, we would never progress past our starting salary, adjusted for inflation.  You will see below that for the last five years D 203 teacher’s average salary has increased slightly more than the average wage increase for all workers nationally. A quick comment on teacher pensions: District 203 educators contribute 9.4% of their income to fund the TRS (Teachers Retirement System). It has been erroneously reported in the past, elsewhere, that the District absorbs this cost for them.  However, the District does pay the TRS contribution for administrators who also are covered by the TRS.

 

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

2007-2011
Average

2007-2011
ECI
Average

Total average annual increase to compensation for incumbent educators between each consecutive year (1.)

6.40%

6.28%

4.76%

4.65%

1.02%

     4.62%

 


Savings due to lower salaries of educators replacing those that have retired or resigned/terminated (2.)

-2.30%

-2.15%

-1.13%

-1.69%

-3.31%

    -2.12%

 

Net average annual increase in salary cost incurred by the district and paid by the taxpayer (3.)

4.10%

4.13%

3.63%

2.96%

-2.29%

2.51%

2.34%

This analysis covers District 203 employees considered Educators and includes teachers, nurses, social workers, counselors, etc. It does not include administrative employees such as principals, central office staff, or aides. The percentages above do not include any changes due to stipend increases (which receive base increases and their own specific step (longevity) increases) or changes to individual educator’s salaries from adding or subtracting stipend qualified activities. Previous versions of this analysis incorrectly stated that stipend changes were included (including stipends would slightly reduce percentages shown). All years are final end of the year percentages except 2008-2009, which was done in March of 2009 and therefore could vary slightly from year-end figures.

 

(Line1.) Salary increases for teachers between each year. This amount includes all the following:

Base salary increase: For the year 2010-2011 there was no increase in the base salary. For 2011-2012, the base increase is 1.35% and for 2012-2013, it will be 1.4%. Previously, for the years 2008-2009 and 2009-2010, there was a 2% increase in the base salary, and for the contract years 2005-2006 through 2007-2008, the amount was 3.3%. You can reasonably look at base salary increases as cost of living increases.

Step and Lane increases: This is a statewide practice, created to provide a framework for salary increases above the starting salary. It should be noted that recently the District and the NUEA  jointly formed the Committee for Professional Innovation to restructure the Lane component of the salary structure. The preliminary framework creates five "paths" a teacher could pursue once they have received their Masters degree. The paths are: Career Educator, Teacher Leader, Expert Teacher, Master Teacher and Research Teacher. The paths have various "bricks," each brick denoting a specific work activity, administrative position or study, that would correlate to a dollar amount for that brick. You can see an illustration of the framework from a presentation made to D203 BOE here. This is not a final document.

Step Increases: are based on years of service. For the year 2010-2011, there was a freeze on step increases. They resumed for the 2011-2012 year. However, in the latest contract it was agreed that, depending on the lane, 7 to 12 of the bottom steps for bachelor degreed teachers and the bottom 7 steps for the first lane of a Master degreed teacher are removed.  The result is The BA lane is now only 6 steps. BA12 is 8 steps, BA24-36-48 are 10 steps, and a MA is limited to 15 steps. A teacher now must have at least a Masters + 12 credit hours in order to access all 22 steps. Step increases have typically added 1.7% - 1.8% to the average increase. To see the current salary schedule go to page 33 in the following document: NUEA Contract

It is important to note that historically, career teachers who reach the end of the salary schedule after 23 years only receive base salary increases in the following years. The 2008-2009 and 2009-2010 contract deviated from this, as the salary increase for teachers after 23 years with a Masters or above, was pegged to inflation, i.e. the 2006 CPI rate of 2.4% for the 2008-2009 year and the 2007 CPI of 4.1% for the 2009-2010 year.  For the current contract, teachers over 23 years will go back to the typical agreement of receiving the base increases.

Lane Increases: are compensation based on advanced educational attainment (Masters and Doctorates). The current contract limits lane changes in year three of the contract and future years, to 1 lane per year or to the MA lane.

Retirement incentives: this consists of additional compensation in the last one to four years of employment not to exceed a 6% total salary increase. Typically, the additional benefit received from this program is lower than 6% because any salary increase a teacher is otherwise entitled to must be netted against this benefit. To be eligible for all four years, the teacher must have had at least 15 years continuous employment with the District prior to retirement and give early notice. Administrators are also eligible for this retirement incentive although they are only required to have  5 years continuous employment with the District. Eligibility is based on making early application. For example, a teacher had to give the District notice by May 1, 2011, that they are retiring on June 30, 2015.

Although this program has a tangible effect on payroll costs, because the 6% value remains constant, there is no increase per se annually. Its effect on Line 1. (average increase in compensation) is dependent on fluctuations in the number of teachers (120 is more or less typical) that have signaled their retirement and are in the program for any given year and fluctuations in base increases, year over year.

For example, although there was a base freeze for 2010-2011, teachers in this program still received their 6%. Therefore, those teachers had the effect of adding .37% to the average increase. Next year, when the base increases 1.35%, that percentage will (all but certainly) go negative and reduce the average increase slightly.

(Line 2.) This amount reflects the lower salary costs of less experienced teachers replacing more experienced (and thus more highly paid) teachers who have left. The majority of the teachers who leave have more than 25 years of work experience. They are traditionally replaced with teachers with less experience and a correspondingly lower salary. The savings illustrated here are typical, and occur whenever there is any turnover, but the percentage has also increased slightly due the decline in average tenure from 15.5 to 13.5 in the past 13 years (latest data available; 1999-2000 through 2010-2011).   

(Line 3.) Net annual percentage change in compensation year over year. This is the actual increase that the taxpayer pays.

Close readers might notice that the percentages from Line 3 of this analysis differ slightly from the percentages that can be derived from the ISBE’s reported average salary for D203. The District sends the ISBE raw salary data in their annual Teacher Retirement System Report. From that data, the ISBE calculates Average Teacher Salary. The ISBE has not published its methodology for calculating average salary; D203’s working assumption is that the Districts Position Control System counts all “educators” call it 1325 employees. The ISBE only counts who they consider “teachers”, say, 1100.

Also, the percentages in Line 1. above do not take into account stipends, but the ISBE average salary calculation does. This should have the effect of making the ISBE percentages lower, all other variances notwithstanding.

Both District 203 and the ISBE computes Average Teacher Salary by taking the total compensation divided by the number of teachers on a Full Time Equivalent basis (FTE).  The FTE is arrived at by dividing the days worked by a teacher by the contract days per year and multiplying that by the Percent of Full Days the teacher works.  Therefore, a teacher starting at semester (1/2 of the year) is counted as a .5 FTE.  A teacher that works ½ day each day is counted as .5 FTE. Some teachers teach additional classes and are over 1.0 FTE.

Rt. Column: 2007-2011 Employment Cost Index, Wages Only (ECI-W)This number is based on the average cost (on an hourly basis) of current employees (in both the private sector and govt. jobs) surveyed on a quarterly basis by the Department of labor. The wages only ECI has increased by 2.34% annually in the last five years calculated on the June 30th. values. The ECI is a respected index used by both the Federal Reserve, who uses it to set monetary policy, and private industry, where it is used as a tool to evaluate an organizations compensation relative to their industry.

 

Questions & Answers:

Please explain how Lines 1-2-3 are calculated:

A.  The Position Control System is used to calculate Line 3, “net average increase,” and Line 2 “savings due to turnover.”The difference is Line 1, average increase without turnover – i.e. incumbent average increase. The value for Line 1 is verified by looking at the base and step increases and the 6% costs built into the contract. The lane increase is a variable because it is not “cast in stone” – teachers receive progression on the salary schedule based on successful completion of graduate coursework that is turned in during the year (the credit is given at two times, November 1 and March 1, during each year).

For Line 2, the total salary of all retired/terminated teachers previous year final salaries plus any base or step increase which the retiring teachers would have been eligible for in the current year represents the cost prior to hiring replacements. The total salary of the new teachers hired as replacements is subtracted from this and then divided by the sum of the previous year total salaries, to calculate the “savings” due to turnover.

Line 3. is calculated using the position control system to find the average salary for both the current year and previous year and calculating the percentage change between them. This is based on average salary instead of total salaries as this corrects for fluctuations in FTE’s

Q. When you look at the salary schedule, why does it look like teachers are getting larger than the 1.7 or 1.8% increase you report for step changes?

A.  The actual teachers are on different places on the scale. A fair number (about 22%) of teachers are at the last step in the schedule – they do not get any step increase at all. When we look at the “scatter gram” (a chart that shows the placement of all the teachers on the salary scale), when you move everyone up on the scale one year, the average increase from this change is 1.8%. The people at the end of the scale don’t move at all (so 22% of our staff see a 0% increase from the step movement). So, those that DO get a step increase average more than 1.8% - but the increase averaged over the whole staff is 1.8%.

Q. Please discuss the effects of teacher attrition on the total compensation the District pays.

A. On an ongoing basis, year after year, teachers retire and are replaced by new teachers at a lower cost. This attrition rate is generally about 2% to 2.5% of the total teacher work force. The District, on average, anticipates 25 retirements yearly, but 56 teachers retired at June 30, 2011. Anytime you replace experienced teachers with new younger staff it will reduce salaries.

Q. The "Family Taxpayers Foundation” website has previously claimed that teachers received overly large annual increases. Is this true?

A. No, not as reported by the “FTF” in their teacher salary study for 1999 through 2005. A closer look at the listing for District 203 shows that, at best, only 80% of D203 teachers/principals/administrators were on the list. It also showed many receiving increases of 10%, 20%, 50%, even 200%. There are a number of reasons for this, for example, some teachers took an unpaid maternity leave in the base year, and then came back for the following full year, and the FTF incorrectly counted the difference in salary as an increase. Some teachers were hired at half time in their first year and became full time in the next; all were incorrectly counted as receiving large increases by the FTF. Some teachers, or administrators, started after the beginning of the school year and then worked the entire next academic year–and again, all incorrectly counted as an increase by the FTF. Other teachers became a coach or taught extra classes– all were counted as a salary increase.

In fact, given these circumstances, one would expect there to be teachers who show decreases in their pay as they worked a full year in the base year and only a part of the next year due to maternity leave or maybe were a coach in the base year and gave up the position the next. However, there were no such decreases reported by the FTF; they only reported increases–not decreases–in the overall payroll. Anyone with a decrease in pay was excluded from their data!

Added by QE203.org: It is unfortunate that the FTF continues to mislabel their database by predominantly using the phrase “Teacher Salary Database” for a database that includes principals and administrators as well.

 

Q.  If a taxpayer is concerned with the actual percentage increase in tax dollars paid by them for raises, which percentage increase represents that amount: Line 1. or Line 3?

A. The final percentage (Line 3.) represents the cost to the taxpayer.