As teachers lose jobs and pay, the Georgia economy suffers from their loss of spending power

AJC business writer Micheal Kanell looks at teacher layoffs and furloughs through a wide angle lens in a good Sunday story that questions  the impact on the larger economy.

With fewer teachers in Georgia classrooms and fewer hours for those remaining, is there a toll on the state's economy from the lost spending power?

With fewer teachers in Georgia classrooms and fewer hours for those remaining, is there a toll on the state's economy from the lost spending power?

He also raises the issue of the long-term impact of the recession on education and whether it is deterring would-be teachers from the profession and pushing them into other fields.

I often wonder who will still be standing when all this is over. I have seen friends who planned to teach forever resign because of the combination of salary cuts and increased pressure to reach artificial and, they say, impossible test score targets.

He writes in his story:

The broad outlines of the crisis are clear: Last fall, Georgia had 117,560 certified teachers, according to the state Department of Education. But in classrooms this coming school year, there may be more than 8,000 fewer teachers.

Those still on the job will face shrinking paychecks as school districts mandate furlough days and slash pay.

That won’t spin the economy back into recession, but it’s enough to hurt: Because of government cuts, roughly 30,000 jobs will be lost, including those of teachers, said Mark Vitner, senior economist for Wells Fargo.

“I would say that we are looking for combined state and local budget cuts of around $900 million over the next year,” he said. “The number of job losses might be smaller than this because of furloughs and reductions in hours.”

Those cuts will reduce the state’s growth by about a half-percentage point from what it would otherwise be, he said.

Unlike the federal government, both state and local entities must balance their budgets. With the economy still struggling, many households hurting and tax revenues weak, they face an impossible choice, said Jeff Humphreys, director of the Selig Center for Economic Growth at the University of Georgia.

“You either have to raise taxes or you have to cut,” he said. “It is not that cutting doesn’t hurt the economy, but it doesn’t necessarily hurt any more than raising taxes. The bottom line is that government will be restraining Georgia’s economic recovery.”

Ordinarily, teachers might seem to be among the work force’s luckier ones, their paychecks often higher than the median income in the state. And it was only a few years ago that Georgia had a teacher shortage and people in other professions were being recruited to fill the void.

Beginning teachers typically start at about $33,000 a year. But with decades of service, advanced degrees and national board certification, a teacher could aspire to annual pay of $80,000. The most recent Census Bureau report shows the state’s median household income is slightly above $50,000.

That ceiling has dropped. National board-certified teachers have long received a 10 percent salary supplement, but that was cut in half last year. This year, lawmakers ended the supplement entirely.

There are many two-teacher families who have been able to combine earning power for a decent living. Of course, when cuts come, those households take a double hit.

hese job and pay cuts might have an even harsher long-term impact.For instance, if they damage education and the quality of Georgia’s work force, the cuts would undermine the state’s economic development.

They could also be reshaping the labor market in ways that are, at least for now, not measurable.

Some young teachers or teachers-to-be will look to other careers. Some laid-off teachers will become stay-at-home parents. Some will seek second jobs or even full-time work in other fields — especially if the market improves.

And some will stay in the schools, while squeezing every penny.

92 comments Add your comment

d

July 18th, 2010
9:53 pm

An important quote was left out of the condensed version of the story…. and I wish our governor would understand this fact:

“Because teachers don’t make extravagant salaries, they spend most of their paychecks each week, and the effect of their spending multiplies as it spreads through their communities.

But multipliers can also work in reverse, said Vitner: Every dollar cut from those salaries effectively subtracts about $1.30 from the overall economy.”

ScienceTeacher671

July 18th, 2010
9:56 pm

I’ve been saying for months that when teachers and other state employees are furloughed or laid off entirely, less is withheld in payroll taxes, less is paid to the state in sales taxes because fewer people can afford to go shopping as much, and therefore state revenues drop…which means that more state employees are furloughed or laid off entirely….

[...] This post was mentioned on Twitter by Buffy Hamilton and ODE GAE NEA, Maureen Downey. Maureen Downey said: As teachers lose jobs and pay, the Georgia economy suffers from their loss of spending power http://bit.ly/aVBRn0 [...]

HS Teacher

July 18th, 2010
10:29 pm

This is a downward spiral that the 8 year leadership of our State republicans have had us on.

They sell a bill-of-goods of less taxes to the voters, but don’t share with them what happens then….. less education money, less income from payroll tax, less income fromm sales tax, etc.

VOTE FOR ANYONE BUT A REPUBLICAN!!!!

Concerned

July 18th, 2010
10:31 pm

Economics 101 (macro).

Echo

July 18th, 2010
10:37 pm

Um, the photo caption says something about “fewer hours” for the teachers remaining. Really? I was just thinking that the job was going to require MORE (unpaid!) hours for those remaining. Larger classes = more paperwork.

ScienceTeacher671

July 18th, 2010
10:56 pm

Echo, should have probably said “fewer PAID hours”…some counties are continuing furlough days.

Agent of change?

July 18th, 2010
11:19 pm

Check out this week’s The Sunday Paper and Stephanie Ramage’s blog on the search for Atlanta’s new police chief and weep. Not because it’s an education issue, but because Ramage’s column is a painful reminder of what this blog could have been.

Even though Ramage endorsed Reed, she doesn’t back down when it comes time to holding him accountable. How much of a true agent of change could this blog have been if a paper with ten times the resources had an education blog with even a tenth of the resolve Ramage displays when it comes to holding public servants accountable?

There was a brief time awhile back when it looked like this blog had turned the corner and was ready to become that agent of change. Unfortunately it looks like the moment may have passed. But I guess it’s just one of those things we have all agreed to be “exceedingly polite” about, much like Arne Duncan was when he came to Georgia and pretended not to notice the 5,000 lb eraser in the schoolhouse.

Children deserve better. Too bad we aren’t willing to honestly discuss the issues that could really help them.

Agent of change?

July 19th, 2010
12:49 am

I guess pointed out The Sunday Paper and Stephanie Ramage as an example of a blog that acts like a true watchdog was too much for the blog monster to handle.

William Casey

July 19th, 2010
12:54 am

I retired in 2006 after 31 years as a teacher/coach/administrator. I’ve recently come out of retirement as a community coach. My son is currently a college student. His future career prospects have been on my mind. Would I encourage him to follow in my footsteps? The answer would be “Yes,” but only if:

1. Teaching/coaching was a “calling,” a true passion without which he would be unhappy. That’s rather difficult to know at age 21.
2. He is willing to defer starting a family or marries an economically self-sufficient woman.
3. Can endure many types of disrespect.
4. Is willing to accept job insecurity at a level unknown by competent teachers in my lifetime.

It’s unfortunate. My son would be a wonderful math teacher and basketball coach.

Principal removed to comply with rules allowing the district to seek stimulus funds.

July 19th, 2010
1:22 am

Joyce Irvine was removed as principal of Wheeler Elementary in Burlington, Vt., to comply with rules allowing the district to seek stimulus funds.

http://www.nytimes.com/2010/07/19/education/19winerip.html?_r=1&hp

Concerned GA Voter

July 19th, 2010
2:49 am

I can only pray that we, the voters of GA, elect politicans this time that vow to support education. I am just shocked how easily we are letting our children, this generation, grow up crippled with all of these cuts….. and not even bat an eyelash.

I don’t like taxes as much as the next person. Heck, I don’t even have children of my own in school. But, even I see the need to fully fund education.

Does anyone honestly think that increasing class size will help in any way? Seriously?

Does anyone honestly think that slashing the budget such that teachers cannot even make copies of handouts, quizzes, etc. will help in any way? Seriously?

Similar to big business, when budgets are slashed it is the worker bees that bear the brunt of the cuts. Why cannot the top take the big hits? Why are principals still paid 6 figure salaries? Why are so many in the DOE still paid 6 figure salaries (including Cox’s personal driver)? Why are the school system central offices still over-staffed with highly paid pencil pushers?

Why must the students of GA suffer? Is this how we will attract new businesses to our State for jobs? They will want to come here for the ‘quality education?’

HS Teacher

July 19th, 2010
3:50 am

Most of the communities won’t say anything….. until school starts. Then, little Sally will come home with stories such as:

1. There are so many kids in my class we had to sit on the floor.
2. The teacher removed all desks and now we sit on carpet squares.
3. There is no paper so all of our tests will be verbal.
4. Etc.

Maybe then the parents and communities will stand up to the politicans and demand for all education money to flow INTO the classroom and fully fund it!

Republican

July 19th, 2010
3:52 am

I haved the solution! Let’s cut taxes and reduce spending. Yeah! That’ll fix everything! Vote for me! Let’s totally abolish the State income tax. Who needs that money anyway?

iTeach

July 19th, 2010
4:07 am

The House recently passed a FULLY FUNDED Education Jobs Bill that has now moved on to the Senate. Contact your senators to show your support of education! http://capwiz.com/nea/issues/alert/?alertid=15205681

NoMoreRepublicans

July 19th, 2010
4:59 am

Finally an article that should have been written when the General Assembly was in session. How come everyone but Sonny and his cohorts can figure this out? Oh wait, he’s too busy building up his real estate portfolio, and brainwashing the masses that taxes don’t need to be raised.

RobertNAtl

July 19th, 2010
5:56 am

There was a front-page story in the newspaper Friday that very much deserves a post of its own on this blog, showing that a 50-36 majority of Georgia citizens support tax increases to restore educational budgets. The budget cuts are *not* an “unfortunate necessity” but rather are the conscious decision of inadequate leaders on local school boards and in the General Assembly. Educational funding ought to be the No. 1 issue in the state and local elections this year, beginning on Tuesday.

Hmmmm

July 19th, 2010
7:08 am

“Republican”….How do other states, such as Florida, operate with out a state income tax? They make it up in other ways. Time for the Fair Tax, perhaps?

Marcel

July 19th, 2010
7:42 am

Let me say this to all Talking Heads running for office on Tuesday. For those of you focusing on the so called ObamaCare and Illegal immigration….read my lips! You will not win many votes! There are 3 things that we Georgians are concerned with at this time. 1. Education 2. Economy 3. Jobs. ObamaCare and Illegal immigration are not tantamount to Georgians at this time due to the aforementioned 3 areas. Once we get Education, the Economy and Jobs in order in Georgia, then and only then should we start focusing on the 2 other Federal and not local items.

Do any of you understand?????

high school teacher

July 19th, 2010
7:57 am

Hs Teacher, you forgot to mention that we should also not vote for Roy Barnes.

mike

July 19th, 2010
8:01 am

I really don’t see what the big deal is all about. The morons of this state keep electing the same representatives who all display this mindset. And when the economy ends up like it is right now and falls on the heads of the citizens of this state, every one acts so surprise. Education is the last thing people of this state seem to worry about. I guess that is why Georgia is closer to the bottom when compared to other states when education is rated. One thing the citizens can be proud of. We have Go Fish. And tomorrow Georgians will be electing idiots who will spend their time fighting something that helps out a lot of the people in this state. Obamacare. Yes and it does help students.

Rick

July 19th, 2010
8:13 am

Stop the budget drain caused by the education of illegal aliens and their anchor babies. Use E-Verify to deny jobs to illegal aliens and they will self-deport and take their anchor babies with them back to their home countries. We are sick and tired of spending money on illegal aliens! Our schools are full of them.

Chris Murphy, Atlanta, GA

July 19th, 2010
8:14 am

@Agent of change: Stephanie Ramage may be exhibiting ‘buyer’s remorse,’ as she banged the drum loudly and often for Reed’s election. Norwood may have a somewhat unknown commodity, but a lot of people, me included, wanted a change from the Maynard-Andy- Shirley crowd and their favorites and contacts; for some reason, she thought that he would break the mold. He may be different, but he is still relying on the same people, and they have not proven to offer answers to the City’s problems.
I will say that both publications are doing well in fulfilling their 1st Amendment obligations, by doing what they can to hold public servants’ feet to the fire. Note that the AJC has drastically downsized in the last many years, far past what any government or school system has.

Chris Murphy, Atlanta, GA

July 19th, 2010
8:17 am

I agree with other posters who say that when the school year gets in gear, and parents see the actual effects of all the mind-numbing budget figures, that is when the heat will finally turn up- and just in time for the November election, but too far after the primaries. The best choices may not be noticed, except in hindsight.

Dekalb Mom

July 19th, 2010
8:19 am

One issue that hasn’t been discussed yet is the fact that the furlough days Dekalb County is making the teachers take are all professional development/teacher workdays. How are they supposed to raise the bar if they aren’t able to improve themselves?

SGaDawgette

July 19th, 2010
8:52 am

And — as this morning’s lead article in the AJC notes — fewer employees mean less contributions into the state health benefit plan (can anybody NOW say Ponzi scheme????).

SGaDawgette

July 19th, 2010
8:55 am

Please, please, please don’t ask for more money for the schools until somebody somewhere figures out how to get it to where it’s intended (the classroom at the bottom of the educational pyramid) instead of where most of it ends up (fat cats taking their cut at the top). Until the fat cats are gone, the money only ends up in the litter box.

Economicwoes

July 19th, 2010
9:18 am

Burlington, Vermont. I see the problem as an uncaring central office staff. They knew the school’s problems, they could have turned it into charter and kept the principal. Why didn’t they?
Maybe Alvin sent his security force up there again, to harass and convince them to keep the statue quo.

Northview (Ex)Teacher

July 19th, 2010
9:38 am

Of course, all of this hurts teachers, which is bad enough. Maureen is spot-on here when she wonders who will be left teaching. I’m afraid it’s going to be people who are incompetent or not good enough to get a job elsewhere. Many of those people routinely rise to Admin anyway, so perhaps nothing will change.

The bigger problem, of course, is what will happen to the students. I long thought that nothing would change until the situation begins to interfere with the demands of the high-maintenance parents of the state, but now I am not so sure. What seems to matter most is making sure that their kids get at least a 3.0 in high school so that they don’t have to pay for college. They don’t want to pay for education, but they don’t mind dining at the public trough, do they? It’s not about education—at all.

Colleges now seem quite content to go along for the ride. Students are money, so why hold them to any level of academic accountability? It’s much easier simply to pass them along so long as the funds hold out.

Like William Casey, I would not encourage my child to be a teacher in Georgia, though I would in the right place. I’ve seen too many good teachers get chewed up and spat out here, while poor teachers rise through the system (sometimes they become principals and admin assistants at Northview).

Recently, I had a chance to lunch with an official of Gwinnett County. He thought I was a bit dense because I did not understand that the purpose and function of the school system is to administrate, not to educate. Education really doesn’t exist as a priority, does it?

Melville said it best, I think: “Ah, the world. Oh, the world.” I don’t suppose too many kids will be reading him any time soon. But at least they can mark circles on bubble sheets. Oh, the world, indeed.

Vince

July 19th, 2010
9:39 am

@ HS Teacher…. So you really fault the collapse of the country’s economy on the folks in the Georgia Legislature? Wow.

I know principals make more money than teachers but please know that our salaries have been cut also. I will make $15,000 less this coming year than I did two years ago. My monthly salary will be reduced by $533 every month through next June. God only knows what will happen at that point. $533 a month hurts!

Had Enough

July 19th, 2010
9:50 am

Dekalb Mom..trust me, those teacher development days are not a loss to the teachers. Usually the same old stuff with a new name. If the teachers are experienced, they will be fine without the development days. Regarding so called “teacher work days”, they went out of existence years ago. They became “sit in a meeting all day long” days, doing some kind of data charts, curriculum mapping, or whatever the current “in thing” was to justify somebody’s job in the county office.

Had Enough

July 19th, 2010
9:55 am

Hmmm, responded to Dekalb Mom but it’s lost in the filter. Just a comment that the “Development/Work Days” will not be missed by the teachers. They are a waste of time and do nothing to develop the teachers’ teaching skills. They usually involve some current “trend” that is just an old idea with a new name, and ends up creating more paper work for the teacher.

Get over yourself

July 19th, 2010
10:00 am

Vince, I wish I could feel for you, but I don’t. You still have a job, benefits and a roof over your head. There are MANY educators who do not. Tighten your belt and make it work. It is much easier to live on less than nothing at all.

Myself and other educators wish we could just cut our budget. At one time I would have had the same mindset as you, I now know better. Ground beef and ramen noodles… whatever. Mortgage companies only work with you when you have some sort of income.

SGaDawgette

July 19th, 2010
10:01 am

Vince, at least you still have a job. How many of your teachers were RIF’d?

Vince

July 19th, 2010
10:02 am

In the general election, if Barnes is the Democratic candidate, as it appears he will be…I will vote for whomever runs against him. Doesn’t matter who it is.

SGaDawgette

July 19th, 2010
10:05 am

Try directing your votes closer to home — the school board, maybe.

Veteran teacher, 2

July 19th, 2010
10:29 am

@Had Enough-Please do not paint everyone with the same brush. The Professional Development in my system is always spot on and usually leaves us excited. If the Professional Development in your area is substandard, please take care of it in your area. There is no reason in this day and time for Professional Development to be worthless. Demand better!!

Nothing We Can Do

July 19th, 2010
10:42 am

Handel would be brutal for teachers, as would all the Republicans. This no tax, cut spending mantra is just being implemented and it is a part of their overall plan to eliminate public education entirely. Put Handel or the others in charge and you can get ready for vouchers. The schools will become “re-segregated” this time not just along racial lines.

Vince

July 19th, 2010
10:46 am

@SGeorgia Dawgette…None of our teachers were involved in a RIF.

Teachers took a 2.75 percent cut (7 furlough days) and we took a 6.3 percent cut…courtesy of 15 furlough days.

Vince

July 19th, 2010
10:49 am

@ Get Over Yourself

True, I do still have a job, but I halfway expect that to end within a year. Younger folks command a lower salary.

catlady

July 19th, 2010
10:52 am

Comes today the news that the health insurance for state employees fund is in trouble. Teachers and other state workers are going to see their premiums rise again (who knows about the deductibles and co-pays, as well as the change in formulary for what prescriptions cost). The article in the AJC notes that the state gave school boards and other state entities PERMISSION TO PUT LESS THAN THEIR SHARE INTO THE FUND, but now STATE EMPLOYEES ARE GOING TO HAVE TO PAY MORE BECAUSE THERE WILL BE A DEFICIT. Humm. More shifting onto the backs of the workers, including furloughs, increased costs for other insurances, fewer benefits.

When I am 62–if I should live so long–I will have in 41 years with the state. Wonder if there will be anything left in TRS to provide my pension? Will there be anything left for health insurance for retirees?

Methinks there needs to be a full audit for the funds of state workers. The pie is disappearing awfully fast.

Think about this when you vote tomorrow, folks!

high school teacher

July 19th, 2010
11:02 am

Vote for David Poythress – if we all band together and vote democratic tomorrow, and vote for the same candidate, we can keep Barnes from going further. Also, Poythress seems to be a really good choice for education.

SGaDawgette

July 19th, 2010
11:02 am

@Vince, glad to hear none of your teachers were involved in RIF. Assuming, however, that this economic climate continues, whose job is more expendable to your school board? This year most metro counties have demonstrated that the lowest paid (the ones on the front line, like cafeteria, maintenance, para-pros, teachers) are the quickest to feel the axe. So, unless your county office decides to completely shut down your school, I’d say your job is safer than anybody else’s on your campus. I sincerely hope you use that slightly-more secure position to advocate for those in your charge.

Get over yourself

July 19th, 2010
11:05 am

Vince, in this day and age it is not necessarily the younger teachers. The same advance degrees my district bragged about us educators having can be a reason to RIF or improperly evaluate. You decide what you want to call it. For me, I was not tenured but have a specialist degree and am working toward a doctoral degree. True, young teachers with an undergrad degree are quite cheap. I am looking to take my advance degrees elsewhere. The private sector loves a masters degree. When you have more to offer, your options increase a bit.

Regardless, education will NEVER get as much from me as I have given in the past. School districts, Cobb in particular, have proven to be disloyal. If money is tight, just say so. No need to ruin our chances of being hired elsewhere just to cover your own A**. Countless extra hours, buying clothing and school supplies for students in need, donating coats when children come to school in T-shirts in the winter, household goods when there is a child’s home has burned down,class parties when parents were not able to pay, purchasing and giving books to students who did not have any in their own home, etc. What we do on a daily basis, without being asked, is far reaching. We will see what the coming years hold. We educators now have less to share with others and have to focus solely on our own families.

Teaching family

July 19th, 2010
11:29 am

We’re close to the final straw. Something is going to give soon. My husband and I are both highly-educated teachers and our idealism is fading fast. We both could have chosen more lucrative careers, but we wanted something that would 1) make a difference in society, and 2) support a close-knit family life. After staying home with our young kids for 7 years, living off of 1 teachers salary, I finally returned to the classroom this past year. What I returned to was a different job than when I had left – Longer hours, extreme pressure on test scores, helicopter parents, and an 180 day curriculum that was expected to be taught in 140 days b/c test prep kicked in by March. That’s not to mention furlough days, distressed and unmotivated colleagues and administrators, rising insurance premiums, and no hope for a raise regardless of performance. Due to the recent budget cuts, I lost my teaching job in May. I’m thankful! Public education no longer supports the ideals for a career it once did.

My husband, who has been teaching for 12 years, is at risk of losing his teaching job next year if our county phases out his elective program due to budget constraints. He loves his job. He’s a wonderful teacher, and typically has more students sign up for his classes than he can accommodate. He hasn’t seen a raise in years, and his salary continues to decline. We’re in our mid-thirties with young kids. We knew as teachers, we’d always have to practice financial responsibility. But, we also saw a future with rising incomes, the ability to send our kids to camp and enroll them in sports, and one day… family trips that don’t involve a frugal pop-up camper. We’re sliding in a direction we don’t want to go. We’ll both make our exit from teaching if Georgia cannot figure out how to nurture education. I’m so concerned about the quality of teachers that will be left in a few years if someone with the power to change things doesn’t step up to the plate soon.

Teacher Reader

July 19th, 2010
12:15 pm

The problem that I see isn’t putting more money into education. The problem is spending what we have in the effective, efficient way. When secretaries in the central office make more than teachers, the district has a problem. When there are more or just as many administrators as there are teachers in a school system we have a problem. The budget cuts performed in DCSS did not address the bloat in the central office. I do not know other school systems, so I cannot comment about them. Tax payers should not have to pay for people to be employed for the sake of employment, while the quality of education that the children receives continue to get less. Our education systems seem to have forgotten that their job is to educate the children, not make or create unnecessary or unneeded jobs. The systems also need to realize that they need to spend tax payer dollars in a more frugal way and make sure that they are getting the most bang for the bucks that they are spending.

As a former teacher, I am tired of hearing of teachers and other school personnel complain about taking pay cuts. There are many people who are in that situation not just us. Instead of complaining about pay cuts, we need to be yelling and screaming about the waste and bloat that happens in many school districts that lead to this problem in the first place.

SGaDawgette

July 19th, 2010
12:35 pm

@ TeacherReader, you are entirely correct! FWIW, CCSS did an equally poor job of addressing central office bloat. Not only do some secretaries there make more than some teachers, the super has FOUR secretaries!

ScienceTeacher671

July 19th, 2010
12:55 pm

@iTeach, I do not think the federal education jobs program is the answer, nor do I think it should be passed, nor do I think Georgia should participate if it is.

It will be funded by borrowing more money, and the federal deficit is too large already.

Our General Assembly could have funded education, if they had chosen to do so, and if Georgia voters had demanded it, by raising a penny of sales taxes, raising our 2nd-lowest-in the nation cigarette taxes, allowing Sunday alcohol sales, etc.

If Georgia doesn’t want increased federal involvement in education, we ought not to rely on the feds to bail us out of a problem of our own making.

catlady

July 19th, 2010
1:06 pm

Vince, $533×12 isn’t 15,000? (Even by exploratory math standards)

Teachers: simplify the tests you give. All multiple choice, even for writing papers. If the state says the CRCT can evaluate higher level thinking, we should take them up on that format.

Simplify your lesson plans. Make one lesson plan form on the computer and fill in the blanks each week.

I know one thing: I will honor my contract (which I signed, blank, again, for the 14th year, even after the school law attorney hired by our school board told us to NEVEr sign it blank!). The difference is, I don’t think we know even yet what our salary will be. I will do my best to exactly fulfill the terms of my contract.

What did Stalin say to the Russian Army? Not one step back.

I am hopeful that some of you in districts with educated, involved parents will see some real sand raised when parents see what they get this year.

I will vote for Poythress. We can’t have Barnes, and there is no Republican worth our vote.

5th grade teacher

July 19th, 2010
1:22 pm

As usual, within the first few comments of any blog entry, we have this person who says nothing but spits bullets at Maureen. Who is this person? I’m curious. Ex-boyfriend? Someone you cut in front of at the grocery store? It’s amusing, but getting very tiresome. The poster needs to say something instead of complain about what is not said.