Appendix. Value for Money? Teacher Compensation and Student Outcomes in Canada s Six Largest Provinces

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1 1 Appendix Commentary 434 Appendix Value for Money? Teacher Compensation and Student Outcomes in Canada s Six Largest Provinces Introduction This Appendix contains two additional lines of analysis as robustness checks on the results presented in the main Commentary of the same title. It also presents further details on the construction of the data. Some Additional Results: Different Measures of Outcomes I use the Pan-Canadian Assessment Program (PCAP) Grade 8 results in place of PISA scores to construct Figures A1a, A1b, A2a and A2b. These four graphs parallel similar graphs in the text. PCAP results are presented in Table A1. In Figures A1a and A1b, I plot PCAP results, using the salaries of the highest paid and secondhighest paid teachers, when these salaries are placed in the salary percentiles of all employees, regardless of education level. In Figures A2a and A2b, PCAP results are plotted, again using the salaries of the highest paid and second-highest paid teachers, when these salaries are placed in the salary percentiles of all employees with a completed bachelor s degree who are not teachers. The only major difference between the PCAP results and the previously discussed PISA results is that Ontario, with its higher teacher salaries, tends to record better results on the PCAP reading and mathematics assessments relative to the other five provinces. However Manitoba, with its even higher salaries, does not do well on PCAP. Alberta, with clearly lower salaries than Ontario, dominates Ontario in science. Overall, there is no consistent positive relationship between salary percentiles and PCAP results. Some Additional Results: Different Measures of Teacher Income Percentiles As discussed in the Commentary, the teacher pay categories followed a British Columbia Teachers Federation (2014) analysis. These were roughly the two highest-pay categories in each province. (For Manitoba, TF actually selected the highest and third-highest pay categories as comparable to Category 5 and Category 6). In two provinces, Alberta and Saskatchewan, there is a third-highest pay category that includes a significant percentage of teachers. Specifically, the third-highest pay category of Saskatchewan teachers instructs roughly 50 percent of all students. In Alberta, I was able to obtain information from several large school boards on condition I not release their names. It appears that in Alberta, as in Saskatchewan, the thirdhighest pay category of teachers is commonly used and may well be the most common teacher. Table A2, a modified version of Table 1, shows the entry and highest salaries for the third-highest pay category of Alberta and Saskatchewan teachers. These additional third-highest pay salaries are then placed in percentiles, as in the main text. These are found in Tables A3 and A4. Figures A3a, A3b, A4a and A4b present relationships between test scores on both PISA and PCAP and the salary percentiles of the most common teachers in each province. In British Columbia, the most common pay category is the second-highest pay category. In Saskatchewan, it is the third-highest pay category. In Alberta, based on the limited information I have, I am assuming it is also the third-highest pay category. In Manitoba, it is the second-highest pay category, as presented in the text. In Ontario, it is the highest-pay category. In Quebec, there is only one pay category.

2 2 Figure A1: Teacher Salaries As a Percentile of Salaries Among All Earners, with PCAP Scores PCAP Score (95 percent Confidence Interval) Figure A1a: Earnings Percentiles of Second-Highest Teacher Salaries Relative to All Earners and PCAP Scores Salary Percentile Math Reading Science PCAP Score (95 percent Confidence Interval) Figure A1b: Earnings Percentiles of Highest Teacher Salaries Relative to All Earners and PCAP Scores Salary Percentile Math Reading Science Source: Author s calculations as described in text and Appendix.

3 3 Appendix Commentary 434 Figure A2: Teacher Salaries As a Percentile of Salaries of Non-teachers with Bachelor s Degree, with PCAP Scores PCAP Score (95 percent Confidence Interval) Figure A2a: Earnings Percentiles of Second-Highest Teacher Salaries Relative to Non-teacher Earners with Bachelor s Degrees and PCAP Scores Salary percentile Math Reading Science PCAP Score (95 percent Confidence Interval) Figure A2b: Earnings Percentiles of Highest Teacher Salaries Relative to Non-teacher Earners with Bachelor s Degrees and PCAP Scores Salary Percentile Math Reading Science Source: Author s calculations as described in text and Appendix.

4 4 Table A1: Average Results on 2013 PCAP, with Interprovincial Rankings Assessment Alberta Saskatchewan Manitoba Ontario Quebec Mathematics (higher than) 489 () 502 (,, ) 488 () (,,, ) 527 (,,,, ) Reading (higher than) 502 (, ) 502 (, ) 487 () (,,,, ) 503 (, ) Science (higher than) 501 (,, ) 521 (,,,, ) 486 () (,,, ) 485 () Notes: *Standard errors are presented in Figures A1a through A2b. A province is stated as dominating results in another province when its 95-percent lower bound exceeds the 95-percent upper bound for the dominated province. Source: O Grady and Houme (2014). Table A2: Teacher Salaries in Third-Highest Pay Category in Alberta and Saskatchewan, 2013/14 Province Alberta Saskatchewan Current Dollars (2013/2014) Entry 57,935 51,476 Highest 91,961 79,706 Source: Author s calculations as described in Appendix. Table A4: Teacher Salaries in Third-highest Pay Category in Saskatchewan and Alberta as a Percentile of Salaries of Non-teachers with Bachelor s Degree Province Alberta Saskatchewan Aged Aged All Ages Table A3: Teacher Salaries in Third-highest Pay Category in Saskatchewan and Alberta as a Percentile of Salaries Among all Earners Source: Author s calculations as described in Appendix. Province Alberta Saskatchewan Aged Aged All Ages Source: Author s calculations as described in Appendix.

5 5 Appendix Commentary 434 Figure A3: Most Common Teacher Salaries As a Percentile of Salaries Among Earners, with PISA Scores PISA Score (95 percent Confidence Interval) Figure A3a: Earnings Percentiles of Most Common Teacher Salaries Relative to All Earners and PISA Scores Salary Percentile Math Reading Science PISA Score (95 percent Confidence Interval) Figure A3b: Earnings Percentiles of Most Common Teacher Salaries Relative to Non-teacher Earners with Bachelor s Degrees and PISA Scores Salary Percentile Math Reading Science Source: Author s calculations as described in text and Appendix.

6 6 Figure A4: Most Common Teacher Salaries As a Percentile of Salaries Among Earners, with PCAP Scores PCAP Score (95 percent Confidence Interval) Figure A4a: Earnings Percentiles of Most Common Teacher Salaries Relative to All Earners and PCAP Scores Salary Percentile Math Reading Science PCAP Score (95 percent Confidence Interval) Figure A4b: Earnings Percentiles of Most Common Teacher Salaries Relative to Non-teacher Earners with Bachelor s Degrees and PCAP Scores 450 Salary Percentile Math Read Science Source: Author s calculations as described in text and Appendix.

7 7 Appendix Commentary 434 I calculate the salary percentile for the most common teacher for all earners as well as for earners with completed bachelor s degrees who are not teachers or professors. Figures A3a, A3b, A4a and A4b do not reveal an obvious relationship between the percentile of the most common teacher s salary and either PISA or PCAP results. Construction of Compar able Salary Grids across Provinces To compare salaries across the six provinces, I used existing grids to construct a teacher s salary path starting at age 25 with zero years of experience through a career that lasts 35 years. There are two provinces with uniform salary grids across all schools and boards, Saskatchewan and Quebec. In Saskatchewan, the provincial grid has several teacher categories; in Quebec, the provincial grid is without categories. The Quebec grid has 17 steps based on annual experience. The initial placement of a new teacher in Quebec is determined by the number of years of that teacher s schooling Step 6 if schooling is evaluated at 19 or more years; Step 4 if there is 18 years of schooling; and Step 2 if there are 17 years of schooling. In the calculations below, I assume a Quebec teacher starts at Step 6 following TF (2014). In the other four provinces, each school authority or school board, even if part or all of its funding comes from the province, has a separate grid. In each of these provinces, I created a provincial grid as a weighted average of the largest school boards where the included boards taught 50 percent or slightly more of the students in that province. In Ontario, where secondary and elementary teachers in the same board typically earn different salaries, I used a weighted salary average of the two teacher groups with the weights reflecting the proportion of elementary and secondary teachers among all teachers in the province. I used the following school boards or authorities in the provincial averages: British Columbia: Alberta: Manitoba: Ontario: Surrey, Vancouver, Coquitlam, Burnaby, Central Okanagan, Richmond, Greater Victoria, Langley, Abbotsford. Calgary Public, Edmonton Public, Calgary Roman Catholic, Edmonton Roman Catholic, Rocky View, Elk Island, Pembina Hills. Winnipeg, River East Transcona, Louis Riel, Pembina Trails, Seven Oaks, Brandon. Toronto, Peel, York, Toronto Catholic, Dufferin-Peel Catholic, Thames Valley, Ottawa-Carleton, Durham, York Catholic, Halton. Choices for Comparable Classifications across the Grid I placed teachers in five of these six provinces in a salary classification that roughly corresponds to the highest level of educational achievement (see Table A5). Quebec is the exception as years of education determine the starting point in a single grid and salary increases only with years of experience. In all other provinces, some type of agency determines a teacher s qualifications based on the kind of postsecondary degree, practical experience and various other factors. TF (2014) assigns teachers outside of its own province to classifications that correspond to Category 5 and Category 6 in British Columbia (see Table A5 for the comparison of categories. Tables A6 through A8 compare salary levels of comparable teachers in other provinces). It seems relatively clear that Category 5 in British Columbia is a five-year Bachelor of Education program or a four-year undergraduate degree with an additional year of professional teacher training. Category 6 is

8 8 Table A5: Comparable Teacher Categories Across Provinces Following TF (2014) Study Category 5 Category 6 Alberta Five years teacher s education Six years teacher s education Saskatchewan Class 5 Class 6 Manitoba Class 5 Class 7 Ontario A3 A4 Quebec Single scale (not applicable) Single scale (not applicable) Source: Author s calculations from TF (2014) and school board contracts cited in TF (2014). comprised of teachers with an acceptable graduate degree. However, there appear to be other paths for a teacher to upgrade from Category 5 to Category 6. In addition, contracts have a Category 5+ in which the salary is very close to a Category 6 but there is no explicit or implicit requirement for a graduate degree. I made a partly successful attempt to discover the percentage of teachers in each province in each category. What became clear is that the percentage of teachers in the top two pay categories as selected by TF (2014) varied substantially across provinces. According to the Public Schools Employers Association, about 50 percent of its teachers are Category 5 and 25 percent are Category 6. However, the association was unable to provide what portion of teachers were Category 5+. The Elementary Teachers Federation of Ontario (ETFO) (2014) reports 79 percent of its members are in the equivalent of Category 6, a classification called A4 in Ontario. The Ontario Ministry of Education reports that some threequarters of elementary and secondary teachers fall into category A4, a classification that does not require a graduate degree. This is the top pay category in Ontario. In Saskatchewan, 50 percent of its teachers are in Category 5 or Category 6 roughly 40 percent in the former and 10 percent in the latter. The other half of the province s teachers is in Class 4, a salary group with a lower salary than either category selected as comparable by TF (2014). The Manitoba Teachers Federation reports that about 50 percent of its members are in Class 5 (the second-highest pay category in my terminology and one selected by TF) and roughly 25 percent in Class 6 or Class 7, part of the highest pay category. Class 7 Manitoba teachers were treated as equivalent to the highest-paid Category 6 teachers in British Columbia. I was unable to get complete information on the distribution of teachers in Alberta by classification. I have made contact with a number of school boards who have provided the information on the distribution of teacher classification within their board. The information was provided on the condition that I not identify the individual boards. It would appear that a significant percentage of Alberta teachers fall into Class 4 and are paid lower salaries. There is a reasonable case to be made that Class 4 is the most common current teacher

9 9 Appendix Commentary 434 Table A6: Category 5 Equivalent Salary Grids for the First 12 Years (Second-highest Salaries) Province Alberta Saskatchewan Manitoba Ontario Quebec Current Dollars (2013/2014) Year 0 46,597 61,419 54,393 55,318 49,632 49,940 Year 1 49,158 64,620 56,781 58,058 53,069 52,064 Year 2 51,719 68,014 59,273 60,970 56,521 54,277 Year 3 54,281 71,385 61,875 63,924 59,985 56,585 Year 4 56,842 74,715 64,592 66,908 63,569 58,991 Year 5 59,402 78,113 67,427 69,970 67,098 61,499 Year 6 61,963 81,522 70,387 73,062 70,630 64,112 Year 7 64,524 84,855 73,476 76,235 74,157 66,838 Year 8 67,086 88, ,518 77,756 69,678 Year 9 69,647 91,659 80,069 83,782 81,280 72,640 Year 10 74,353 95,284 83,584 84,517 84,993 75,729 Year 11 74,353 95,284 83,584 84,517 85,798 75,729 Source: Author s calculations as described in text and Appendix. classification in Alberta. Neither the Ministry of Education in Alberta nor the Alberta Teachers Federation would provide any information on teacher classification on a province-wide basis. Using the Labour Force Survey to Construct Comparable Earnings The variables used from the Labour Force Survey (LFS) are: UHRSMAIN usual hours per week worked at main job. HRLYEARN hourly earnings at main job. Using population weights, I calculated annual earnings as equal to UHRSMAIN HRLYEARN 52. Details on the LFS are found in Statistics Canada (2012). I used two months of data: October 2013 and April 2014 to represent earnings over the 2013/14 academic year. All observations from

10 10 Table A7: Category 6 Equivalent Salary Grids for the First 12 Years (Highest Salaries) Province Alberta Saskatchewan Manitoba Ontario Quebec Current Dollars (2013/2014) Year 0 51,245 66,961 57,952 62,100 52,955 49,940 Year 1 54,046 68,457 60,448 64,974 56,402 52,064 Year 2 56,847 71,834 63,051 68,111 59,977 54,277 Year 3 59,648 75,226 65,766 71,409 63,566 56,585 Year 4 62,449 78, 68,599 74,839 67,344 58,991 Year 5 65,250 81,951 71,553 78,339 71,125 61,499 Year 6 68,051 85,522 74,635 81,900 74,910 64,112 Year 7 70,852 88,675 77,849 85,474 78,695 66,838 Year 8 73,653 92,085 81,202 89,083 82,505 69,678 Year 9 76,454 95,419 84,699 93,662 86,289 72,640 Year 10 81,535 99,112 88,347 94,467 90,184 75,729 Year 11 81,535 99,112 88,347 94,467 91,816 75,729 Source: Author s calculations as described in text and Appendix. both months can be used since the LFS rotates its sample every 6 months. For comparison purposes, I calculated annual earnings for all full-time, singlejob workers in each of the six provinces and for each age group in the LFS. I then calculate salary percentiles and round up to the nearest whole number. A Comparison: Salaries in Contract Data Survey Measures of Earnings of Educational Workers It is possible to use the both the LFS and the National Household Survey (NHS) to measure the earnings of persons employed in the education sector (See Table A9). The upper panel of Table A9 shows peak 2013/14 teacher earnings in the three

11 11 Appendix Commentary 434 Table A8: Salary Grids for the First 11 Years in Alberta and Saskatchewan (Third-highest Salaries) Alberta Saskatchewan Current Dollars (2013/2014) Year 0 57,935 51,476 Year 1 61,310 53,776 Year 2 64,624 56,180 Year 3 68,019 58,690 Year 4 71,390 61,313 Year 5 74,738 64,054 Year 6 78,135 66,916 Year 7 81,544 69,907 Year 8 84,877 73,031 Year 9 88,287 76,295 Year 10 91,961 79,706 Year 10 91,961 79,706 Year 11 91,961 79,706 Source: Author s calculations as described in Appendix. pay categories highest, second-highest (and thirdhighest in Alberta and Saskatchewan) discussed earlier. This data came from the contracts in force in I then attempt, to the extent possible with the public use files of the two surveys above, to find employees with similar backgrounds to the teachers at peak earnings. In the LFS, the comparator category is teachers and professors. Table A9 presents median salaries for teachers and professors aged when the respondent has been in the same job for 10 years or more and is a union member. I use these restrictions to help identify teachers who are at the peak salary. Using a median is an attempt to find the more numerous teachers in the pool of teachers and professors. I look only at those who indicate they are union members in an attempt to exclude teachers in private schools. The LFS education categories separate university degree holders into two groups: those with completed bachelor s degree(s) and those with a higher degree. Consider first those employees with any degree. The match between the LFS data in 2013/14 with the contract data from 2013/14 is partly successful. The LFS education category salaries in 2013/14 are lower than the contract data. The closest matches are in British Columbia for a secondhighest paid teacher and in Ontario for the median earnings of a teacher or professor with a bachelor s degree. In these two cases, the matches are almost perfect. Remember that in Ontario 75 percent of teachers are in the highest pay category. The NHS reports annual wages in increments of $1,000 from the year 2010, four years before the contract data in 2013/14. There are narrower educational categories in the NHS so that I can identify respondents with bachelor s degrees, master s degrees and doctorates within the group of full-time professional workers in education. I measure median wages of those persons who are education professionals aged in an attempt to look at peak earnings. For educational workers with a master s or bachelor s degree, as well as those with exactly a bachelor s or master s degree, the pattern of pay across the six provinces in 2010 is similar to that in the 2013/14 contract data. Salaries in Alberta and Ontario are higher than in the other provinces. In comparison, salaries in Quebec and British

12 12 Table A9: Salary of Education Workers Calculations from Different Public Sources Province Year Alberta Saskatchewan Manitoba Ontario Quebec Data from Teachers Contracts Current Dollars (2013/2014) Peak of Highest Pay Category 2013/14 81,535 99,112 88,347 94,467 91,816 75,729 Peak of Second-Highest Pay Category Peak of Third-Highest Pay Category 2013/14 74,353 95,284 83,584 84,517 85,798 75, /14 91,961 79,706 Data from Labour Force Survey: Teachers and Professors Current Dollars (2013/2014) Median Earnings, Age 40-49, any Degree and Union Member with 120 Months Tenure Median Earnings, Age 40-49, Bachelor s Degree and Union Member with 120 Months 2013/14 79,996 90,001 75,004 77,877 90,994 69, /14 74,997 85,342 75,004 75,004 90,001 70,004 Data from National Household Survey: Full Time Professional Workers in Education Current Dollars (2010) Median Wage, Bachelor s or Master s Degree, Age Median Wage, Bachelor s Degree, Age Median Wage, Master s Degree, Age ,000 87,000 74,000 77,000 86,000 68, ,000 86,000 73,000 77,000 87,000 68, ,000 91,000 92,000 63,000 84,000 67,000 Median Wage, PhD, Age ,000 92, ,000 88, , ,000 Data from Labour Force Survey: Teachers and Professors Current Dollars (2010) Median Earnings, Age 40-49, any Degree and Union Member with 120 Months Tenure Median Earning, Age 40-49, Bachelor s Degree and Union Member with 120 Months Tenure ,992 77,937 69,997 70,005 85,007 68, ,005 79,996 69,992 69,992 83,993 67,995 Source: Author s calculations as described in text and Appendix.

13 13 Appendix Commentary 434 Table A10: Aboriginal Shares of Population, 2011 Province Alberta Saskatchewan Manitoba Ontario Quebec All Persons Aboriginal Identity Persons Aged 5-14 Aboriginal Identity All persons Band Member or Registered Indian Persons Aged 5-14 Band Member or Registered Indian Source: Author s calculations from National Household Survey (2011), public use microfile. Columbia are relatively low. If we consider only persons with either degree or with a bachelor s degree, salaries in Manitoba are higher than in Saskatchewan. In Ontario and Quebec, as predicted by the contract data and the proportion of teachers in the highest pay categories, there is little wage premium in obtaining a master s degree. However, the payoff for a master s degree is high in British Columbia, Alberta and Saskatchewan. The Manitoba data is puzzling. Professional workers in education in Manitoba, at least according to the NHS, earn less with a master s degree than with a bachelor s degree. I have no explanation for the low median salary estimate of an education worker with a master`s degree in Manitoba of $63,000. Perhaps this is a case where the NHS fails to produce good quality data even at the provincial level on a relatively small number of persons. The NHS allows me to separate the professional workers in education with doctorates from other professional workers in education. The median salaries for these PhDs, presumably professors, are higher than for the less educated professional education workers. The presence of this group warns against using average salaries from the LFS category of teachers and professors. Averages are likely to be very misleading in this data because of the effect that professors with high salaries will have in skewing up the averages. The last panel in Table A9 shows the LFS median earnings of teachers and professors in This is an attempt to match the LFS to the NHS directly above and maintains the pattern of the highest-paid teachers being in Alberta and Ontario and the lowest-paid in Quebec and British Columbia. It also shows that the LFS earnings measures in the four Western provinces and to a lesser degree in Ontario are significantly less than the NHS values for the corresponding categories. Measuring the Percentage of Aboriginals across the Provinces Table A10 uses NHS data to create four measures of the Aboriginal population in the six provinces. These percentages are derived from two NHS

14 14 questions. One asks for the respondent s identity as non-aboriginal or of Indian, Métis, Inuit or other Aboriginal background. The responses are used in the first two rows of Table A10 and to construct Figure 3. It is very clear that the provinces fall into three groups. Alberta and British Columbia have about 6 percent of their population responding as Aboriginals; Saskatchewan and Manitoba 16 percent and Ontario and Quebec about 2 percent. Since Aboriginal birth rates are higher than those in the overall population, the percentage of the population aged 5 to 14 that self-identifies as Aboriginal is higher than the overall share of Aboriginals. In Saskatchewan and Manitoba 26.4 percent of the population aged 5-14 is Aboriginal, a very high percentage relative to other provinces. Another pair of Aboriginal-related questions in the NHS asks if a respondent is either a band member or a registered Indian. I present the percentage of those who are either a band member or registered Indian for the population as a whole as well as the group aged 5 to 14 in the bottom two rows of Table A10. A much smaller percentage of persons are registered Indians than self-identify in either age group. For the purposes of this study, the NHS data (and any other data that I have used) are not able to identify the percentages of Aboriginal children in schools that participate in the PCAP or PISA tests. The data in Table A10 indicate these percentages will be highest in Saskatchewan and Manitoba. They also indicate that the percentage of children aged 5-14 that are registered Indian, and perhaps more likely to be in band-operated schools, is higher in those two provinces than in Alberta and British Columbia.

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