With education spending the second largest part of provincial spending, and teacher salaries the central part of the education budget, are we getting good value for money?
The recent settlements between teachers and the Ontario government raised teachers’ salaries and left existing pension arrangements in place. But with education spending the second largest part of provincial spending, and teacher salaries the central part of the education budget, are we getting good value for money?
Paying teachers well attracts good people to teaching. That’s important. There are a number of international studies that suggest that when teachers are paid more, students perform better on international assessments.
But across the six largest Canadian provinces, the provinces where teachers earn more are not the ones with better assessment results. In other words, there’s no relationship between test results and teacher salaries across these provinces.
I compared teacher salaries to those earned by other full-time employees. Teachers in each of the six large provinces are well compensated. When compared to all full-time employees, teachers average at about the 80th percentile of earnings. In other words, they earn more in salary than eight out of 10 full-time employees. Even when compared to other full-time employees with university degrees, teachers earn more than seven out of 10 workers.
But across provinces, there are substantial differences in teacher salaries, both in terms of basic pay and compared to the salaries earned by other employees within their own province.
To compare two large provinces, British Columbia and Ontario, the typical teacher in Ontario earns in the 85th percentile — more than eight out of 10 workers — and the typical teacher in British Columbia earns in the 73rd percentile — more than seven out of 10 workers. Part of this wide gap occurs because about 80 per cent of Ontario teachers earn in their highest salary category compared to only 25 per cent of those in B.C.
And the lower salaries of B.C. teachers are not offset by better pensions. In Ontario, a teacher earns full pension once years of service and age add up to 85. In B.C. years of service and age must sum to 90 — so Ontario’s pension benefits are also noticeably higher.
With such a large differential in compensation, does Ontario attract better employees to be teachers and do Ontario teachers produce better results than teachers out west?
The answer is no. In the 2012 international standardized test results where all provinces participated, B.C. and Ontario students are tied in reading and math results and B.C. students are better in science. This doesn’t mean Ontario students are weak and B.C. students are strong. Rather, it shows that despite being taught by teachers with a much better compensation package, Ontario students do not perform at a higher level than students in B.C.
If we were to ask what level of compensation is required to draw good people into teaching and use available evidence to answer that question, there is a reasonable argument that B.C. pays its teachers well enough to attract good people. This suggests Ontario pays more than it needs to attract good people into teaching.
Ontario could, over time, mimic B.C.’s compensation patterns for its teachers. This would mean curbing the growth of teacher salaries and reducing the gap in pension generosity. This would substantially reduce the cost of education in Ontario, and free up resources for other educational programming for Ontario’s students.
David Johnson is professor of economics at Wilfrid Laurier University and C.D. Howe Education Policy Scholar.
