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"The quality of a public education greatly hinges on our efforts to sufficiently invest in our schools and teachers," the new report stresses, calling for "targeted and sustained investments."
The gap between the weekly wages of US public school teachers and other college graduates not only continued to grow last year, but "reached a record high," according to a report released Wednesday by a pair of think tanks.
Sylvia Allegretto, a senior economist at the Center for Economic and Policy Research and research associate at the Economic Policy Institute, found that this gap, known as the teacher pay penalty, grew to 26.9% in 2024, "a significant increase from 6.1% in 1996."
Allegretto tracked data back even further—to 1979, when teachers earned an average of $1,219 a week, while other graduates earned $1,580, adjusted for inflation. In 2024, those figures rose to $1,447 for teachers and $2,361 for other similarly educated workers.
The numbers above are simple averages. The researcher also aimed to "estimate weekly wages of public school teachers relative to other similarly situated college graduates working in other professions," accounting for "ways the two groups may differ fundamentally which typically affect pay on margins such as age, educational attainment, race/ethnicity, and state of residence."
She found a "nearly 30-year trend of relative teacher weekly wages increasingly falling behind those of other similarly qualified professionals." While the gap averaged 8.7% pre-1994, "the shortfall worsened considerably starting in the mid-1990s."
In 1996, "on average, teachers earned 73.1 cents on the dollar in 2024, compared with what similar college graduates earned
working in other professions—much less than the relative 93.9 cents on the dollar that teachers earned in 1996," the report says.
Allegretto also separated workers by gender, and found that while the relative female teacher weekly wage "was at a premium that averaged 3.3%" before 1994, "starting in 1996, the female gap quickly went from parity to a penalty, landing at a 21.5% penalty in 2024."
As the report details:
There is an important story behind the declining relative wages experienced by female teachers. Historically, the teaching profession relied on a somewhat captive labor pool of educated women who had few employment opportunities. This is thankfully no longer the case, but increased opportunity costs are a part of the story and reflected in these results. Expanding opportunities for women enabled them to earn more as they entered occupations and professions from which they were once barred.
In fact, the simple average weekly wages (inflation-adjusted) of female teachers compared with their nonteaching counterparts grew in lock step from 1979 until they started to diverge in the late 1990s. They were close to parity in 1996, when other female college graduates earned just 0.7% more than female teachers. But this divide grew nearly every year—reaching 40.9% in 2024.
Conversely, the trends in the weekly wages of male teachers compared with other male college graduates were never at parity. But like their female counterparts, men also experienced a considerable increase in the pay gap—from 24.1% in 1996 to 81.7% in 2024. Therefore, the regression-adjusted relative wages of male teachers have seen sizable penalties throughout the timeframe of this paper (1979–2024) and in my earlier analyses using 1960, 1970, and 1980 decennial Census data. Over the long run, the male relative penalty worsened from 20.5% in 1960 to 36.3% in 2024.
While all states and the District of Columbia have a wage gap between teachers and similar graduates, Allegretto examined how the penalties vary by state. The biggest penalties since 2019 were recorded in Colorado (38.5%), Alabama (34.3%), Arizona (33.8%), Minnesota (33.3%), and Virginia (32.7%), while the lowest were Rhode Island (10%), Wyoming (11%), New Jersey (12.7%), Vermont (13%), and South Carolina (14.1%).
Allegretto also acknowledged "the view that, on average in the US, teachers generally receive a larger share of their total compensation as benefits—such as health or other insurance and retirement plans—compared with other professionals."
From 2020-24, "the benefits advantage that favors teachers varied from 8.8% to 9.9%, but over the same timeframe the teacher wage penalty grew substantially. Thus, in 2024, the teacher total compensation gap widened to -17.1%—the largest on record," she wrote. "Of course, even if the teacher benefits advantage could exceed the large teacher wage penalty, the standard of living for teachers would likely fall, as they would have little in the way of earnings to make ends meet."
In 2024, teachers earned 73 cents for every dollar their similarly educated peers made, on average—a record low.In 1996, the gap was much smaller: teachers earned 94 cents for every dollar.We need to pay teachers more! How? By investing in public education. www.epi.org/publication/...
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— Economic Policy Institute (@epi.org) September 24, 2025 at 9:59 AM
The report says that trends from "the last three decades have no doubt already had profound consequences on teacher retention and recruitment," citing research on staffing challenges, college students forgoing teaching careers due to low wages, parents steering their children into professions that pay better, fast-tracking credentials in response to shortages, the heavy use of unqualified teachers, and the reliance on unqualified substitutes.
"The quality of a public education greatly hinges on our efforts to sufficiently invest in our schools and teachers," the publication stresses, calling for "targeted and sustained investments" at the local, state, and federal levels, and the expansion of collective bargaining.
"Regrettably, sustained and effective policy interventions capable of mitigating, much less substantially improving, the trends outlined in this long-running series have been lacking," concludes the report. "This is a troublesome reality, especially in the United States—a country that has more than enough resources and wealth to be the envy of public education around the world."
The publication comes as President Donald Trump works to dismantle the US Department of Education and elected Republicans, along with some Democrats, try to push tax dollars toward private and charter schools.
Amid such efforts this summer, Senate Health, Education, Labor, and Pensions Committee Ranking Member Bernie Sanders (I-Vt.) held a town hall with educators and introduced the Pay Teachers Act, which would ensure they earn at least $60,000 annually, require districts to give raises throughout teachers' careers, and provide at least $1,000 per year for classroom supplies.
"The theory of Trumponomics is failing," said one economist.
A federal jobs report released on Friday showed the US economy added a mere 22,000 jobs in August in yet another signal of weakness in the US labor market.
Economists had projected the economy would produce 75,000 jobs on the month, which means that the Bureau of Labor Statistics (BLS) numbers released on Friday were well below the consensus estimate.
What's more, the total number of jobs created in July and June were once again revised downward, and the economy as a whole has added an average of fewer than 30,000 jobs over the last three months.
Heather Long, the chief economist at Navy Federal Credit Union, put the bad jobs report in stark terms.
"The labor market is going from frozen to cracking," she said, and then pointed to net job losses in industries including mining, construction, and manufacturing that show significant stress in the blue-collar economy. In fact, the majority of job growth came from the healthcare industry over the last month.
"The US job market is almost entirely dependent on healthcare," she observed. "That's not healthy for the economy."
Justin Wolfers, an economist at the University of Michigan, also said that the new numbers showed a continued deterioration in both the US labor market and the economy as a whole.
"I'm worried," he said. "The economy was in a good place in late 2024. That's no longer true. And the trajectory is, at a minimum, concerning. That's millions of people's lives, and millions of stories of pain."
Wolfers also zeroed in on the fact that manufacturing employment has been contracting for several months, despite US President Donald Trump's pledges to lead a manufacturing revitalization.
"But the Administration has made dramatic policy shift to boost manufacturing, and it just ain't working," he said. "Manufacturing employment fell [by 12,000 jobs], and is down [78,000 jobs] over the year."
Former BLS commissioner Erika McEntarfer, whom Trump fired last month after he baselessly accused her of concocting negative job numbers to harm him politically, argued on Bluesky that the new report's downward revisions of previous monthly estimates are indicative of a labor market that is very quickly cooling.
"The larger-than-usual downward revision last month was in large part driven by a negative skew in the job growth distribution among late reporting firms," she said. "That's unusual, but it's happened before when the pace of job growth slows rapidly. This print is more evidence that was the case."
Mike Konczal, senior director of policy and research at the Economic Security Project and former member of President Joe Biden's National Economic Council, argued the new jobs report demonstrates that "the theory of Trumponomics is failing."
"The first theory of Trumponomics was that tariffs would build up manufacturing work and federal workforce cuts would free up workers for them," he explained. "That's failed. Manufacturing lost jobs almost as fast as the federal workforce (-12 vs. -15K)."
Konczal then showed how Trump's tariffs have hurt his stated goal of bringing back well-paying jobs for blue-collar men, as industries that produce such jobs have also been harmed by his tariffs on foreign goods and materials.
He also pointed out that Trump advisers claimed that mass deportations of undocumented immigrants would create new job openings that native-born workers would rush in to fill.
"But, you guessed it, that's also failing," he said. "Amidst the broader weakening, the native-born unemployment rate is at the highest levels since the pandemic."
Elise Gould, the director of health policy research at the Economic Policy Institute, similarly noted that "there have... been sustained losses over recent months in manufacturing, construction, and mining," in recent months, which she said was "an indication that Trump's blue-collar renaissance is clearly not happening."
Alex Jacquez, chief of policy and advocacy at the progressive advocacy organization Groundwork Collaborative, called the jobs report "devastating," while laying the blame at the feet of Trump.
"Trump's promises to working families have fallen flat," he said. "The unemployment rate is the highest in nearly four years, the economy has lost nearly 40,000 manufacturing jobs this year alone, and millions of workers are unable to find full-time employment. Families are getting fewer chances to secure the American dream in Trump's economy."
Rep. Brendan Boyle (D-Pa.) reacted to the jobs report by issuing a scathing rebuke to Trump and his management of the economy.
"Donald Trump inherited an economy built on years of steady job growth," he said. "In just seven months, he's managed to screw it up—just like he's screwed up everything else in his life. Now, working families are getting squeezed from every direction: higher prices, Republicans' Big Ugly Law ripping health care away from millions, and a job market that's slowing down."
"Confidence that the Fed will respond wisely to future periods of macroeconomic stress... will evaporate," warned one economist.
Economists are warning that US President Donald Trump's efforts to meddle with the Federal Reserve are going to wind up raising prices even further on working families.
Michael Madowitz, principal economist at the Roosevelt Institute, said on Wednesday that the president's efforts to strong-arm the US central bank into lowering interest rates by firing Federal Reserve Gov. Lisa Cook would backfire by accelerating inflation.
"The administration's efforts to politicize interest rates—an authoritarian tactic—will ultimately hurt American families by driving up costs," he said. "That helps explain why Fed independence has helped keep inflation under 3%, while, after years of political interference in their central bank, Turkey's inflation rate is over 33%."
Heidi Shierholz, the president of the Economic Policy Institute, said that the president's move to fire Cook "radically undermines what Trump says his own goal is: lowering U.S. interest rates to spur faster economic growth."
She then gave a detailed explanation for why Trump imposing his will on the Federal Reserve would likely bring economic pain.
"Presidential capture of the Fed would signal to decision-makers throughout the economy that interest rates will no longer be set on the basis of sound data or economic conditions—but instead on the whims of the president," she argued. "Confidence that the Fed will respond wisely to future periods of macroeconomic stress—either excess inflation or unemployment—will evaporate."
This lack of confidence, she continued, would manifest in investors in US Treasury bonds demanding higher premiums due to the higher risks they will feel they are taking when buying US debt, which would only further drive up the nation's borrowing costs.
"These higher long-term rates will ripple through the economy—making mortgages, auto loans, and credit card payments higher for working people—and require that rates be held higher for longer to tamp down any future outbreak of inflation," she said. "In the first hours after Trump's announcement, all of these worries seemed to be coming to pass."
Economist Paul Krugman, a former columnist for The New York Times, wrote on his personal Substack page Thursday that Trump's moves to take control of the Federal Reserve were "shocking and terrifying."
"Trump's campaign to take over monetary policy has shifted from a public pressure to personal intimidation of Fed officials: the attack on Cook signals that Trump and his people will try to ruin the life of anyone who stands in his way," he argued. "There is now a substantial chance that the Fed's independence, its ability to manage the nation's monetary policy on an objective, technocratic basis rather than as an instrument of the president's political interests and personal whims, will soon be gone."
The economists' warnings come as economic data released on Friday revealed that core inflation rose to 2.9% in August, which is the highest annual rate recorded since this past February. Earlier this month, the Producer Price Index, which is considered a leading indicator of future inflation, came in at 3.3%, which was significantly higher than economists' consensus estimate of 2.5%.
Data aggregated by polling analyst G. Elliott Morris shows that inflation is far and away Trump's biggest vulnerability, as American voters give him a net approval of -23% on that issue.