This article is Part I of a two-part series examining how North Carolina’s public school system pays its teachers.
Teacher pay: It’s a subject on the minds of many in North Carolina these days. Last month Gov. Pat McCrory announced a plan to boost salaries for starting teachers roughly 14 percent over two years to about $35,000. McCrory said his plan was a start and should help to make salaries competitive with those of teachers in Virginia, South Carolina and Tennessee. 
Not surprisingly the Governor’s proposed plan received a tepid reception from teachers and educators. One teacher pointed out if the plan is approved it might be possible for new teachers to make more than teachers with four or five years of experience. One school board member wondered if the higher salaries would force local school districts to raise the salaries for the teachers they employ. About 6,500 of North Carolina’s 95,000 teachers are funded by local communities.
While agreeing North Carolina needs to boost starting salaries, most teachers say all teachers need a raise. Other than saying he wants a comprehensive plan to address teacher compensation, the Governor has yet to share any specifics regarding overall teacher raises.
I mention these comments to illustrate an underlying problem. Most people assume the teacher pay issue is fundamentally about money. It’s not. If Bill Gates donated a billion dollars to teachers in North Carolina, it might relieve some short-term anxieties about the level of pay. However, the real problem is not what teachers are paid, but how teachers are paid. This is not to say money is unimportant. But the teacher pay issue won’t fully be resolved until state lawmakers address some of the root causes of the problem.
Teacher Salary Schedule
A few things are immediately apparent from a quick review of the current teacher salary schedule. First, pay levels are tied to time on the job (i.e., seniority) and academic credentials or certification. The difference in pay levels from year to year is about 1 to 2 percent. However, over the past five years, teachers have not received the “step” (i.e. the additional pay a teacher receives for each year of work) increase listed on the salary schedule. Thus teachers with 0-5 years experience would all be working at the same starting salary. The North Carolina General Assembly ultimately has the final say on whether teachers will get step increases (years of experience) and an annual raise. Teachers have received only one raise (1.2 percent in 2012-13) in the last five years. However, in the five previous years teachers averaged annual wage increases of 4.74 percent. 
The North Carolina Teacher Salary Schedule is posted below, and available online here. The chart lists different pay grades based on years of experience and credentials (bachelor’s degree, master’s degree, doctoral degree, National Board for Professional Teacher Standards Certification). Teachers with NBPTS certification receive an immediate 12 percent pay increase. North Carolina has more than 20,000 teachers with NBPTS certification – more than any other state. Last year legislation was passed to phase out the supplemental pay for teachers with master’s and doctoral degrees; mostly because legislators could not find conclusive research that the extra credentials improved student performance.
Salary Schedule Shortcomings
Despite repeated inquiries, Civitas was unable to obtain specifics regarding the exact origins of the current salary schedule. A school finance expert at the Department of Public Instruction guesstimated that the salary schedule probably dates back to the Machinery Act of 1937. That’s the legislation that transferred much of the financing and staffing of local schools to state government. Of course the salary schedule has been modified through the years, most recently with the Excellent Schools Act of 1997.
Salary schedules and position allotments have been around for a long time. But that is not reason enough to deem the schedules effective or to justify their continued existence. The numerous shortcomings of the current salary schedule argue for a total revamping of how teachers are paid in North Carolina.
Disconnect Between Performance and Pay
Compensation in the business or professional world is usually tied to how well a service is performed or provided. Sales people are paid on commission because they are paid to sell; accountants are paid to keep accurate books; lawyers are paid to provide legal advice. In these cases compensation is tied to performance. This is not the case with teachers. As stated previously, teacher pay is determined largely by academic degrees, time on the job and certifications.
This is not to say teachers are not doing their job. There are many hardworking teachers. It is to say that pay for North Carolina teachers will not vary based on their performance or how much their students learn. In short, current teacher pay is not linked with job performance. Such conditions can have significant impact on the profession and accountability efforts.
Equality or Excellence?
In the eyes of some, teachers value service and credentials. They believe all teachers should receive the same pay regardless of performance. They believe such policies are fair and promote a harmonious workplace. However, is that an accurate view of reality? What about performance and the quality of education the children receive?
North Carolina’s current teacher pay structure means that teachers who excel and do great things for students are frequently compensated at the same pay levels as teachers who only contribute the bare minimum. Over time such realities can have a deadening impact on motivation and enthusiasm. As in all professions, there are great teachers, mediocre teachers and bad teachers. Teachers know who the good teachers are. Treating unequals as the same isn’t equity. It’s an injustice. It hurts all teachers, disincentivizes excellence and ultimately hurts students.
Teacher Starting Pay
Teachers have been complaining loudly about starting teacher pay and the need to increase it. The problems of low starting salaries are exacerbated by the lack of salary increases in five years. The real problem is the slow slope of the teacher pay scale. Unlike doctors or lawyers who can frequently be making top pay within 15 years, teachers must wait 30 years before making top earnings. These trends only accelerate attrition rates. It means our schools will frequently lose their most energetic, most productive teachers for monetary reasons, while at the same time paying the less productive teachers the highest salaries.
Schedule Doesn’t Reflect Market Realities
Lastly, the current state teacher salary schedule also fails to adequately reflect real differences in labor markets. Just as there are differences across the country in cost of living and the supply of teachers in differing fields, those differences also exist within individual labor markets in North Carolina. Yes, according to the salary schedule, a math teacher in Elizabeth City with 20 years’ experience will be paid the same as a math teacher with 20 years experience (and similar credentials) in Charlotte.
Local school districts do, however, attempt to offset this shortcoming. Teachers receive on average about $3,800 in supplemental pay from local districts. Most districts pay some amount but how much can vary widely. Supplemental pay is to boost teacher salaries and help to compensate for higher cost of living or market shortages. By its very nature, supplemental pay is an admission that the current salary schedule fails to address the realities of different labor and academic markets.
North Carolina’s teacher pay problem deserves a long-term solution. The current teacher salary system has outlived its usefulness. It has too many shortcomings and disincentives. What steps can North Carolina take to provide fair compensation while incentivizing performance and accountability? Those are the topics we’ll explore in Part II of this series.
 Governor, NCGA leaders unveil teacher pay plan, Carolina Journal Online February 11, 2014; available at: http://www.carolinajournal.com/articles/display_story.html?id=10827
 Statistical Profile Online, Public Schools of North Carolina, Public School Full-time Personnel, available at: http://apps.schools.nc.gov/pls/apex/f?p=1:21:0::NO:::
 Highlights of the North Carolina Public School Budget 2014 , “Compensation Increases: Teachers and State Employees, (p.14) , available at: http://www.ncpublicschools.org/docs/fbs/resources/data/highlights/2014highlights.pdf
 NC again leads nation in national board certified teachers, Press Release Department of Public Instruction, December 17, 2013. Available at: http://www.ncpublicschools.org/newsroom/news/2013-14/20131217-01