That teachers’ wages have stagnated over two decades of growth in public school funding highlights deep structural problems in K–12 finance.
large body of research shows that effective teachers are the most important school-related factor in determining student success, making teacher compensation a key policy lever. “We need to pay all teachers more—and effective teachers even more,” said Heather Peske of the National Council on Teacher Quality in a recent SCHOOLED debate on teacher pay.
Peske has a point. The nationwide average teacher salary fell by over 6 percent between 2002 and 2022, going from $75,152 to $70,548 in 2023 dollars, according to new Reason Foundation research. In total, inflation-adjusted teacher salaries fell in 40 of 50 states, as shown in Table 1.
It’s also a fact that teacher salaries are tied to educational attainment and years of experience, meaning that high-performing teachers—and those in shortage areas like math, science, and special education—aren’t paid more for their results or expertise.
To put the right incentives in place, bold teacher pay reforms are needed. But to maximize the long-term impact of these policies, it’s important to address the root causes of stagnant salaries. Examining data both before and after the COVID-19 pandemic reveals structural problems in K–12 finance that keep dollars out of teacher paychecks.