School choice can help public school teachers. Here’s how.

The battle over school choice in Texas is heating up. State legislators have filed several bills promoting transferable student funding in the form of education savings accounts and tuition vouchers. Opponents of these plans, such as the president of the Houston Federation of Teachers, claim school choice “rob[s] public schools.” 

Understandably, the debates have focused on how school choice affects students. But the noise is drowning out an important question: What are the implications for teachers?

The answer may surprise you. Although it’s not researched as extensively as student achievement or taxpayer savings, there are several studies that explore how school choice affects teacher pay. Out of six studies going back to 1994, one finds an ambiguous effect, while the remaining five find a small positive effect. Even for teachers who remain in the traditional public school system, school choice increases compensation.

Economics can explain this counterintuitive result. Because the public school system is very large and legally protected, it functions as a monopsony: an employer with disproportionate power over wages and benefits. Just like monopolists have too much control over the price of goods and services, monopsonists have too much control over the price of labor. This puts teachers in a weak position. Their lack of options makes it easier for the public school system to hold down their wages. 

The solution is genuine competition. When public schools have to compete with private schools, charter schools and other institutions, they have to give teachers a better deal. More options for students also means more options for those instructing students. This is an important spillover benefit of school choice. It needs to be part of the conversation.

Other research shows teachers could use a helping hand. For example, Dr. Benjamin Scafidi’s study demonstrates teachers’ salaries have stagnated partly because increases in education funding have largely gone to fund non-instructional staff. In Texas, for a 20-year period beginning in the early 1990s, per-pupil funding increased 17 percent but teacher salaries rose a measly 1 percent. Absent competitive pressure, this “staffing surge” will continue to deprive teachers of raises.

If school choice passes during the 2023 legislative session, it could kickstart a reversal of teacher attrition and retirement. Relatively low compensation for teachers compared to what they could earn elsewhere partly explains the state’s “teacher shortage.” Legislated pay raises can and should address this, but there’s no reason to stop there. A school choice bill would harness market forces, allowing competition to reward teachers based on the value they provide to our students. There are benefits further down the road, too. As salaries rise, more teachers will enter the labor pool. This will help public schools keep up with increased enrollments.

Opponents of school choice argue that transferable student funding is a zero-sum game: any gains to students and parents come at the expense of teachers. But this framing is wrong. Bolstering competition makes both sides better off. Vouchers and education savings accounts can make teacher talent an even more valuable asset. We need to start treating school choice and traditional public schools as complements, not substitutes. More choice for students means more choice for teachers.

Alexander William Salter is the Georgie G. Snyder Associate Professor of Economics in the Rawls College of Business at Texas Tech University, a research fellow at TTU’s Free Market Institute and a community member of the Lubbock Avalanche-Journal editorial board. The views in this column are his own.