Are Teachers Really Underpaid?


A good guy to know strives to find common ground on controversial issues.  I recently read in Dale Carnegie’s How to Win Friends and Influence People, it’s usually not worth it to fight someone on something they aren’t going to change their mind on. If you really want to win someone over to your ideology, you need to start from a place you can both agree on. So when I decided to do a podcast on the problems with American education, I wanted to try to find some facet of the discussion where there could be some common ground. Education has always been a controversial issue, but in the last several years, with the decline of American students’ performance relative to other nations, and more recently, with all of the excitement in Wisconsin, people are looking for answers on how we can make our system better.

So I came across this McKinsey study that focuses on one central question; “Who are we, as a society, attracting to the teaching profession?” Which begs the next question, “What does this mean for the students?” The study systematically compares this to who other countries are attracting to the teaching profession, as well as whom we attracted to the teaching profession 40 years ago.

Disclaimer: I have many people very close to me that are teachers and I am pretty sure they are all awesome at it. This post/podcast is meant to summarize McKinsey study and get people talking about one possible way we could improve education. As with any study, there are always many individual exceptions to the trends, (but it’s still valuable to think about the trends)

Before I dive into the McKinsey study, we need to make 3 assumptions;

  1. Great teachers get results no matter what. Many studies since the 1970’s have shown that the greatest predictor of student success is the quality of their teacher. There is an awesome American Radio Works documentary where one guy says something like, “A great teacher could teach in a cave and still get great results.” Other things are important; family support, poverty, class size, resources, etc. But these pale in comparison to teacher quality.
  2. “Success” is hard to measure, but for the purpose of this study, the only real way to measure student “success” is by looking at test scores. Unfortunately, it’s the best way we have to quantify how much students achieve. There is so much more learning and growth happening that doesn’t show up on test scores, but we aren’t going to be able to have any sort of meaningful discussion if we don’t have some sort of indicator of how effective a teacher is. Student test scores become more valuable when they are used comparatively, i.e. compare a student’s score at the beginning of the year, compared to the end of the year and see how much they learned. Not a perfect measure of success, but it’s what we have.
  3. Finally, we need to assume that test scores (think ACT/SAT) of graduating college seniors mean something, too. Yes, yes, I know some people are bad test takers, and there are really smart people that do poorly on these standardized tests. But at some level, high performance on these tests indicates higher achievement in whatever profession that graduate chooses. Again, I’m sure there are a million exceptions to the rule, but overall, high test scores tend to point to higher aptitude indivuals, who tend to exhibit higher performance in the real world, no matter what profession.


So by now you can probably guess where this is going, remember, we are trying to answer the question “Who are we attracting to teaching, and what does this mean for students?”  So McKinsey focused on students in the top third of their graduating classes. (Sample size was 900 “top-third” students and 525 current teachers that came from the top-third) They found that of today’s graduating college seniors planning to become teachers, 23% come from the top third of their graduating class (by SAT scores). I went one step further and found data on the average SAT scores for intended majors. (My major; business, doesn’t have super high marks either).


Now there’s nothing initially surprising about this. If you assume a normal distribution across all majors, it is not shocking to see that about a quarter of graduating education majors come from the top third, until you start using the data comparatively. So McKinsey compared their data to the test scores of graduating education majors in Singapore, South Korea, and Finland, and found the following:

Source: McKinsey


This is where it starts to get dramatic. For some reason, these top performing countries (again, by student test scores, see assumption 2 above) are attracting ALL of their teachers from the very cream of the crop, while the US is only recruiting 23%!

Another “aha” moment I had was when I read the following about comparing the caliber of student America attracts to teaching now compared to 40 years ago;

“Experienced observers in the US say this is a dramatic change from the situation up through the 1960’s and mid 1970’s, where the academic quality of the teacher corps was effectively ‘subsidized’ by discrimination, because women and minorities didn’t have as many opportunities outside of the classroom.”


So what they are saying here, is that now that the wage gap between men and women in other careers has shrunk (arguably to nothing),  the top-tier aptitude women and minorities are now becoming doctors, lawyers and business people, rather than defaulting to teaching as they may have felt pressure to 40 years ago.

With the question of “who” we are now attracting to teaching answered, the McKinsey study then asks the question “why are we no longer attracting top talent and what can be done to remedy this?” They do so by interviewing these “top-third” graduates about their career choices and their perception of teaching as a possible career choice. I encourage you if you’re interested to check out the full study, but here are some of the highlights:

  • The most important factors “top-third” students looked for in a career in order were: quality of co-workers, prestige, challenging work environment, and high quality training.
  • Only 55% of top-third students thought that teaching offered a “competitive starting salary.”
  • Of the top ten attributes top-third students look for in a career, five have to do with compensation and advancement.
  • When asked to rate this statement: “If I were to do well in this career, it would be financially rewarded,” 13% of top third students not going into teaching strongly agreed, 29% of top third students going into teaching strongly agreed, and perhaps most telling, only 7% of current teachers that came from the top third strongly agreed.


So finally we can attempt to answer the intentionally provocative title of this podcast; “Are teachers really underpaid?” I’m not sure if this McKinsey study offers a definitive “Yes,” for current teachers, but I think we can say, that if we want to attract the cream of the crop to the profession, this is a lever that policy makers and teachers unions would be wise to use. Compared to the rest of the world, and America of 40 years ago, such an important profession does not have the prestige it deserves, and I don’t think it’s a great leap to attribute this to the low compensation of the profession.

For those that love getting political, here is a clever Harvard study that attempts to weigh the relative effects of “wage-compression” and “wage-parity in other professions.” It basically concludes that while unions have indeed increased the average wage of teachers, the total payscale has been compressed, making it difficult for higher performers to be compensated accordingly, which detracts high performers from entering the profession.

I suspect that teacher compensation is a much bigger deal than even the McKinsey study suggests. I think that recent college graduates are likely to rate idealistic attributes like great co-workers and good training higher in a survey like this because they don’t want to be perceived as greedy. I know that when I was trying to decide what I wanted in a career, compensation and opportunity was at the very top of my list. Teaching runs in my family’s blood, and I loved being a tutor in college, but I never seriously considered becoming a teacher mostly because I did not want to make the lifestyle trade-offs. Check out this graph that was in the appendix of the McKinsey study, presenting the salary of a teacher as a percentage of the wage of lawyers and engineers.

Source: McKinsey appendix

So next time things start to get heated in a discussion about the American education system, (especially if there’s a teacher in the room), rather than rag on unions, the achievement gap, and school vouchers, brush up on these studies (don’t forget to check out the appendix for some more cool graphs) and lead with saying something like “Hey, I think a lot of things would start to get better if teachers were paid more…” Common ground is a beautiful thing. Also, let’s go hug some teachers, because after going through all this material, it’s clear that they are uber-important, and they are choosing to teach for some pretty noble reasons.

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