Academic journal article Economic Perspectives

How Will Baby Boomer Retirements Affect Teacher Labor Markets?

Academic journal article Economic Perspectives

How Will Baby Boomer Retirements Affect Teacher Labor Markets?

Article excerpt

Introduction and summary

Teachers play a vital role in their students' educational performance. In addition, there is a correlation between a teacher's experience and her effectiveness in the classroom--at least in the first few years of her career. These intuitive outcomes are supported by a large body of research literature. (1) With this in mind, it is reasonable to view rising rates of teacher turnover (since the early 1990s) as a cause for concern. Further, we expect that retirements, which have driven some of this increase, will accelerate to record levels in the coming decade as growing numbers of baby boomers reach retirement age. (2) This pattern will inevitably necessitate a significant increase in the demand for new teachers. Some communities--for example, poor urban districts, which tend to have especially high teacher turnover rates and severe recruitment problems (3)--might be particularly susceptible to declining teacher quality as a result of increased retirements.

In this article, we use a simple model of teacher demand and supply in order to gauge the implications of baby boomer retirements on the projected demand for new teachers. Our forecast links estimates of demand for all teachers with the expected supply of returning teachers through 2020 (that is, the 2020-21 school year). We assume any shortfall would have to be addressed by hiring additional teachers. We discuss how projected demand for new teachers compares with the past half century and what types of schools are likely to have to augment their teacher hiring over the coming decade. We also calculate bow much teacher salaries would have to increase in order to fill the gap between teacher supply and demand. To compute the supply and demand of the teacher market, we use a variety of data sets and sources--for example, the U.S. Census Bureau's Decennial Census and Current Population Survey (CPS) and various publications of the U.S. Department of Education's National Center for Education Statistics (NCES), including its 2003-04 Schools and Staffing Survey (SASS) and the accompanying 2004-05 Teacher Follow-up Survey (TFS).

We estimate the number of new full-time public school teachers (4) needed from 2009 through 2020 will be between 2.3 million and 4.5 million, with the range encompassing reasonable assumptions about fertility rates, student-teacher ratios, and turnover propensity. Our preferred calculations--based partly on the latest teacher data available from the 2003-04 school year (and therefore not accounting for the economic downturn that began in late 2007)--predict roughly 277,000 new full-time public school teachers needed in 2009--10, rising to 303,000 new teachers by 2020-21, or 3.5 million for all school years between 2009-10 and 2020-21. Retirements account for about one-third of the teachers who leave the teaching work force over this period. Adding the private school sector to these calculations raises the number of new teachers needed by about 20 percent, to 4.2 million, but lowers the fraction due to retirements by roughly 3 percentage points.

These numbers, in isolation, are difficult to assess without some historical context. Therefore, we provide rough estimates of projected demand for new teachers over the past six decades using U.S. Decennial Censuses, combined with analogous hiring projections for the years 2010 and 2020. We find that more teachers will retire between 2010 and 2020 than in any other decade since the end of World War II. But because of relatively slower projected growth in the school-age population, the total number of new teachers needed for all reasons (including retirements) is within historical norms. Indeed, normalized by the size of the aggregate labor force (one rough measure of the potential teacher work force), demand for new teachers will be similar in magnitude in the coming decade to that in past decades. Therefore, we would not expect the increase in forthcoming retirements, in the aggregate, to have a significant impact on national levels of teacher hiring much beyond the variation in teacher hiring needed in the past. …

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