The effects of public unions on compensation

by on December 1, 2016 at 1:50 pm in Data Source, Economics, Education, Law, Political Science | Permalink

I can’t say I followed this debate very closely, still this paper may settle some of the outstanding questions about public sector unions and wages and bargaining power.

The Effects of Public Unions on Compensation: Evidence from Wisconsin (Job Market Paper)

This paper seeks identify the effect that public sector unions have on compensation. Specifically, I look at the compensation premium associated with teachers’ unions in Wisconsin. In 2011, Wisconsin passed a landmark law (Act 10) which significantly lowered the bargaining power of all public sector unions in the state. Using an event study framework, I exploit plausibly exogenous timing differences based on contract renewal dates, which caused districts to be first exposed to the new regulations in different years. I find that the reduction in union power associated with Act 10 reduced total teacher compensation by 8%, or $6,500. Roughly two-thirds of this decline is driven through reduced fringe benefits. The analysis shows that the most experienced and highest paid teachers benefit most from unionization. I supplement the event study approach with synthetic control and regression discontinuity methods to find that regulatory limits on contract terms, rather than other mechanisms such as state financial aid cuts or union decertification, are driving the results.

That is from Andrew Littten, job market candidate at the University of Michigan (p.s.: Michigan, your job market candidate web site is the very hardest to use and browse, please improve it!)

1 AlanG December 1, 2016 at 1:55 pm

Pretty soon Wisconsin will battle it out with Oklahoma for the worst school system in the nation.

2 Tontine December 1, 2016 at 2:03 pm

I remember hearing exactly that a few years ago when the reforms were enacted. I’m sure I’ll hear the same thing a few years in the future.

3 Art Deco December 1, 2016 at 4:05 pm

New York has mediocre schools and is owned by the public sector unions at the same time.

4 Cooper December 1, 2016 at 4:36 pm

I’d also point out that New York spends a whopping $20,000 per student, per year.

Instruction costs alone are $8700/pupil which is higher than the ENTIRE cost of education in Texas or Colorado, both of which have higher high school graduation rates than New York.

5 Troll me December 1, 2016 at 4:53 pm

Barbers are expensive in New Work too. Rent and stuff …

6 The Free Market Is Not God December 1, 2016 at 5:36 pm

Schools need money, and they need to pay teachers well. But they need a lot more than just that. Impoverishing schools or teachers screws them up. But simply throwing money at problems is not enough, in and of itself. Analysis of problems, resources, and possible solutions needs to be done to fix a school system.

People seem to like to either throw money at a problem, or else throw one quick fix at a problem e.g. Common Core– and assume that that is all that needs to be done.

7 Hmmm December 1, 2016 at 7:54 pm

I’m trying to think of any ethnographic characteristics that could explain New York’s poor performance, but I’m stumped….

8 The Free Market Is Not God December 1, 2016 at 8:26 pm

Hmm, are you afraid to say whatever it is you actually mean?

No need to be. Now that we have Trump as our role model, anyone can say anything, even if it’s stupid or unjustifiably insulting to various groups.

9 Cliff December 2, 2016 at 2:00 am

So is it stupid or “unjustifiably insulting” to point out that blacks on average perform poorly on standardized tests? (even when living in wealthy areas, even when adopted and raised by white parents, even when birthed and raised by wealthy black parents)

10 TMC December 2, 2016 at 8:39 am

” even if it’s stupid or unjustifiably insulting to various groups”

We haven’t had that for the last eight years??

11 msgkings December 2, 2016 at 11:40 am

I don’t know about stupid or insulting, but it sure is pointless to point that out. What do we do with that information?

12 Brett December 1, 2016 at 2:05 pm

If it only led to a reduction of 8.5% in income, most of which was in non-wage benefits, then doesn’t that discredit the idea that public sector unions are squeezing out unjustly fat paychecks for themselves on the public dime?

13 Tontine December 1, 2016 at 2:07 pm

8.5% is kind of a lot.

14 dearieme December 1, 2016 at 2:33 pm

And likely to increase as the employers learn more about using their opportunities.

15 (Not That) Bill O'Reilly December 1, 2016 at 2:10 pm

Depends on how we quantify softer benefits like tenure protections. If individual teachers earn 8.5% less, but the workforce as a whole is more productive and less over-staffed, that may suggest the union was in aggregate squeezing unjustly fat paychecks out of the state’s coffers.

16 Troll me December 1, 2016 at 2:26 pm

While taxpayer representatives in government should certainly do their best in negotiations on behalf of the taxpayer (who at some time or another also consumes education both for themselves, their children, grandchildren, etc.), I think it is worth highlighting that the possibility to fill a certain number of teaching positions at a lower salary does not necessarily mean that you’re going to get better value for money at a lower price.

17 we live in interesting times December 1, 2016 at 9:36 pm

Was this fringe benefit health care? I seem to recall that the provider or distributor was an offshoot of the teachers’ union, and when this went thru, their quote dropped 10% because there was competition? Did the TU need all that coverage? I’m sure the discussion was in Professor Althouse’s blog if anyone was interested.

18 Mikea December 2, 2016 at 12:28 am

Well you’d have to show me some evidence of turnover amongst public school teachers for me to believe that.

It’s a cushy job. I know a huge number of them and any who have ever worked in the private sector characterize it as something just shy of a total joke.

19 Troll me December 2, 2016 at 4:04 pm

I don’t think a very high share of teachers would agree with that statement, but anyways …

20 Alan December 2, 2016 at 12:32 pm

Note the longest tenured benefit the most. Seniority as a wage determinant – more than any type of performance evaluation – is really THE problem with teachers unions.

21 Brian Donohue December 1, 2016 at 2:07 pm

Someone remind me why we have public sector unions again.

22 JWatts December 1, 2016 at 2:10 pm

They generate a significant amount of reliable votes and political donations.

23 FDR December 1, 2016 at 2:12 pm

Well, not on my watch.

24 TMC December 2, 2016 at 9:03 am

Essentially a money laundering scam for the DNC.

25 Troll me December 1, 2016 at 2:34 pm

Because people have the right to gather and have mutual interests represented.

We could also try a draft approach for teaching. Or make it so local politicians or anyone who didn’t like a specific teacher for what the say or do could corner them as unprotected individuals and force them out of teaching or to comply with their preferences.

Unions are a part of balance that prevents tyranny.

Are then making 10% too much? Make the case, then negotiate. Taxpayer representatives should not be given a blank cheque, for example.

26 Brian Donohue December 1, 2016 at 3:17 pm

Tyranny of the taxpayer? This is what you are afraid of?

Very unJeffersonian lack of respect for the taxpayer there.

Also, I live in Illinois, so I find your fear extra-laughable.

27 Troll me December 1, 2016 at 5:00 pm

In saying that unions are part of balance that prevents tyranny, I’m speaking of the more general situation. However, in looking to history and examples throughout the world today, it is not at all strange to think that corporatist state powers could be used in an oppressive manner for the purpose of extracting additional labour at lower pay.

If capital holders can control the state and “legally” make it illegal for workers to negotiate collectively, it is not that hard to imagine a return to the situation from which unions arose, where workers would routinely be beaten up or worse if they had the nerve to demand better conditions, or worse, if they expressed an interest in collective negotiation.

No one questions the right of shareholder unions to negotiate collectively through hired negotiators. The same should apply to worker unions.

Are we paying too much in the public sector, as taxpayers? If so, let’s make the case and negotiate hard, not undermine the very right to form groups of mutual interest or to negotiate collectively.

28 Brian Donohue December 1, 2016 at 5:18 pm

The process you describe is very arduous and indirect. Taxpayers enjoy nothing like the governance oversight that shareholders do in corporations.

But it can happen, as we saw in Wisconsin a few years ago. Painful and wrenching and all the anti-democratic stops pulled out (legislators fleeing the state to avoid votes, recall election, etc etc). Ultimately, I am happy to report, the voice of the people was heard. I’m sure you applaud such a hard-nosed approach. Anything short of this would have been thwarted.

It shouldn’t be that hard.

29 Troll me December 1, 2016 at 8:42 pm

“Taxpayers enjoy nothing like the governance oversight that shareholders do in corporations.”

I think this is a mostly correct outlook in this context …

but consider that in some places a politician might be forced to resign over an expensive glass of juice or adding a receipt for gum into their expense claims (both of these happened in Canada) while on official business – whereas corporate executives, in addition to their annual millions, might go through with quite a variety of frivolous expenditures as a part of pampering themselves (presumably they farm out the responsibility to make decisions on much of this pampering…).

So, maybe there’s better oversight in programs stuff, but private sector executives get away with quite a lot of spending that would never be tolerated in the public sector except for the president and some handful of other top figures.

30 Brian Donohue December 1, 2016 at 3:19 pm

The cheques the ‘taxpayer representatives” are cashing here are written by the same unions.

Do you know what governance is?

31 Troll me December 1, 2016 at 5:04 pm

No they aren’t the same unions. For example, schoolboard trustees as purse holders. Or ministers who make budget decisions or otherwise empower negotiators.

None of those are remotely part of unions. Although sometimes they see a little more eye to eye than they should.

But there are lots of relevant issues related to that. Most especially, governments too often hand out more than necessary in order to buy peace, when it would be better to take the case to the public for good reasons to both value the contributions of public servants and to negotiate hard at the same time.

Sometimes, if you negotiate too hard, the most valuable partners will not even bother to come to the table.

32 David Ptr December 1, 2016 at 3:22 pm

Public sector workers do have the ability to gather and have their mutual interest represented; they can, among other things, engage in voting and lobbying [1]. Private sector workers do not have these options unless they are also substantial stockholders, which is uncommon outside of a few worker-owned companies, ergo the need for unions.

[1] See the AEA, one of the most powerful political forces in Alabama for decades, in spite of the fact that public sector unions are illegal in Alabama.

33 Troll me December 1, 2016 at 5:10 pm

Yes, public sector workers do have that right, and that right is what I am supporting right now, even at the same time as I advocate for negotiating very hard with them. For example, when transit workers threaten strikes, I refer to effective public/private competition in transit in some other jurisdictions – this sort of argument constrains the excesses they might demand/request.

If private sector workers have difficulty organizing in a manner to achieve similar negotiation power to the shareholders unions as represented by executives and other levels of management, this is primarily due to watering down laws which previously prevented businesses from retaliating against workers who aimed for workers to be able to negotiate on more even terms with the shareholders’ union.

When you can just fire anyone who is rumoured to support the development of collective bargaining structures among workers to match those put in place by capital holders, this basically prevents any sort of union formation from even starting in the first place.

So … maybe due to global competition there’s less room to negotiate than previously. But that’s not the whole picture.

And, moreover, that situation is not the fault of public sector unions.

34 Jay December 1, 2016 at 3:23 pm

“Because people have the right to gather and have mutual interests represented.”

Do people have the right to obtain employment through the same employer without joining the union? Can the super-star teachers negotiate their own labor contracts?

35 Troll me December 1, 2016 at 5:30 pm

Yeah … then there’s that.

You know …. I somewhat doubt that many of the best teachers are really in it for the money, so long as they can ensure a moderately comfortable life in material terms. So it might actually mean unnecessarily paying out lots of premiums for no additional return … or maybe not.

I don’t know if the analogy makes the concern obvious. But consider the case that local politicians were empowered to create a test used to hire and fire journalists or religious leaders. If the problems in those two cases with respect to freedom, democracy, free expression, and tyranny avoidance are obvious, then why does the same logic not apply to teachers?

In the meantime, clearly taxpayers should be trying to get a good price without driving quality out of the market.

36 Cliff December 2, 2016 at 2:04 am

What would be the problem with a quality test used to hire and fire state-employed religious leaders and journalists?

37 Troll me December 2, 2016 at 4:09 pm

State employed journalists and clerics need to have some sort of certification, as do teachers who require a teaching degree.

That is not the same as administering some standardized test for the purpose of culling those who do not respond in whatever way is appropriate.

Teaching is far more about people skills, especially below the university level. What possible value could a standardized test add? Or … what other mechanism could you possibly be referring to? So, we get rid of the art teachers who couldn’t spell, the gym teachers who were bad at math, and the math teachers who never bothered with history?

As flawed as it is, I trust the arbitrary judgment of peer who have each other’s back than a test designed by politicians. It’d be good to put pressure on the teachers themselves to come up with a solution that would be more broadly acceptable …

38 Troll me December 2, 2016 at 8:51 pm

In private sector education, you tend to get student feedback and standardized test scores both counting heavily for future wage negotiations.

Which means you’re teaching to the test half of the time and primarily focused on pleasing students the rest.

Which leaves no time for deeper learning or more advanced discussion or practice which helps to internalize lessons more completely.

So … for me, when I’ve been teaching, knowing that I’m doing at least OK, my main attitude is “GTFO of my classroom, and please schedule a meeting any time you have constructive criticism or goods ideas to share”. Whatever evaluation comes out of that, I don’t really care. I don’t teach to tests, and I think a lot of good teachers would agree that teaching to tests is mostly a waste of time, and a bare minimum of standardized evaluations should be used to paint broad strokes about performance across the system.

39 TMC December 2, 2016 at 9:06 am

Like in Wisconsin, where half the teachers stopped paying dues. It’s almost like the union isn’t really for the teachers anyways.

40 anon December 1, 2016 at 4:51 pm

The market “problem” is that too many want to be teachers or firefighters and citizens are not willing to lower wages to the market clearing price.

41 Troll me December 2, 2016 at 4:17 pm

The unfortunate result is that we might have to tolerate the higher average quality that accompanies resistance to paying public servants the minimum possible rate tolerated by the market which still fills most positions most of the time.

42 Albigensian December 1, 2016 at 5:33 pm

A “right to gather and have mutual interests” surely does not imply a right to make anyone listen to you, let alone bargain with you. Nor does it imply that employees must at least pay an agency fee in order to keep their jobs.

In Wisconsin as elsewhere in the USA, one’s “right to gather and have mutual interests” has not been infringed.

43 Troll me December 2, 2016 at 4:18 pm

“does not imply a right to make anyone listen to you, let alone bargain with you.”

Surely, then, there is the right to strike if the folks on the other side of the table don’t want to negotiate either, no?

44 Anon7 December 1, 2016 at 7:07 pm

I see no good reason why unions should have the right to force workers to pay dues to their organization. One can only hope that SCOTUS revisits the issue and decides differently.

45 Troll me December 2, 2016 at 4:21 pm

Shareholder unions have an easier time extracting the cost of representing the shareholders as a part of the business operating, in particular because it’s extremely easy to buy and sell shares and you can move your economic resources (financial capital) just about anywhere in a flash.

Something needs to balance this situation. As much as when I’m in that specific situation I advocate for myself to not have to pay fees to representatives who do not negotiate in the way I think represents my personal interest best, at the same time, in balance, I’m not sure of a better way for most people.

46 mw December 1, 2016 at 2:58 pm

Someone remind me why we have political parties. Or organized religion. Or yoga classes.

47 Brian Donohue December 1, 2016 at 3:06 pm

Someone remind me why we have awful analogies.

48 Wonks Anonymous December 1, 2016 at 3:49 pm

In parliamentary terms, a democracy will always have a Government and an Opposition. After a while they tend to get formalized.

49 Todd K December 1, 2016 at 5:38 pm

Here it goes…

Yoga classes == cute chicks.

Religion == for those who can’t get cute chicks at yoga classes

The double equal signs indicate an identity.

Come on, this isn’t that hard.

50 mavery December 1, 2016 at 4:04 pm

Are you asking why we have public sector unions specifically or unions in general? Responses seem to be focusing on the latter question. I think its much more interesting (at least in the context of the OP) to ask, conditional on unions being fine things to have, how the differences in public vice private employment matter when it comes to collective bargaining.

Are there specific things that public sector unions should not be allowed to negotiate that private sector unions should be allowed to negotiate?

How does the prohibition against striking for, say, the police and firefighters impact the role of the union?

51 anon December 1, 2016 at 4:48 pm

Split the difference. Keep public employee unions, but ban them from wage negotiation.

I am less concerned with Union Rep as employee advocate.

52 simeon December 2, 2016 at 7:40 pm

Because freedom of association is guaranteed in the Constitution

53 Jay December 1, 2016 at 2:08 pm

“The analysis shows that the most experienced and highest paid teachers benefit most from unionization.”

Did inequality decrease then?

54 Hazel Meade December 1, 2016 at 2:33 pm

No. It increased.
It means unions reward seniority.
Under typical union contracts, the most senior employees get paid the most and get the most benefits. “Most experienced” = seniority.
It’s almost a tautological statement: “The people who got paid the most benefited the most” – Duh.

55 Hazel Meade December 1, 2016 at 2:33 pm

Oh, sorry, I mean it decreased after the passage of the law. So yes.

56 Jay December 1, 2016 at 3:27 pm

“Inequality decrease” is almost as tough as reading a double negative. I should have said it more bluntly… the existence of unions increases inequality.

57 Troll me December 1, 2016 at 2:39 pm

It’s also maybe wrong.

Isn’t the basic premise of paying people more as they advance in their career that they are probably better at their job after years of experience?

58 Jay December 1, 2016 at 3:25 pm

Is that accounted for when ideologues trot out Gini coefficients or net wealth ratios?

59 Troll me December 1, 2016 at 5:36 pm

It can be.

Or you can just focus on yearly transition matrices between income and sector profiles. Because what actually matters is mobility (access to opportunity), not strictly the distribution per se, no? (Outside of extreme situations…)

60 Brian Donohue December 1, 2016 at 3:28 pm

In the real world, earning power peaks around mid-40s, flatlines for a decade, then gradually declines.

In the public sector, the escalator goes right up to retirement. Extra pay increases are often packed in at the end, which boosts the pension, which is based off of the artificially high wages paid just prior to retirement anyway.

It’s a pretty good racket if you can get it.

61 mavery December 1, 2016 at 4:16 pm

What “real world” is that? In most professional occupations, wages increase with seniority. Typically, this is accomplished through different grading of the jobs. So when you start, you’re an “Engineer I”. After a few years, you become an “Engineer II” and so on. Sometimes these changes mean you actually have different responsibilities and sometimes they do not.

There are other professions where this is not the case. Sales and marketing jobs (As I understand them; I saw the Alec Baldwin monologue in Glengary Glen Ross twice, so I think I’m on pretty firm ground here.) often have clear lines between the amount of revenue you produce and your wage. So these obviously follow a different pattern.

Manual labor seems like a clear case where wages would decline as physical capability declines.

Jobs like “teacher” don’t necessarily fall neatly into any of the above categories. Seniority is best thought of as a proxy for experience and thus quality, though its obviously an imperfect at best proxy. However, I expect there are informal expectations for more senior staff, such as providing mentoring for new hires and the like. There’s also a clear value to firms for having a “corporate culture”, and having long-time employees helps maintain that culture. Of course, it needs to be a useful culture for this to be a benefit to the firm….

62 A Definite Beta Guy December 1, 2016 at 4:46 pm
63 Troll me December 1, 2016 at 5:41 pm

Don’t forget that there’s a difference between what 30 years on the road will do for your skills as a bus driver, as compared to what 30 years running 12 different programs across 5 departments, interacting with hundreds of civil society groups and foreign partners, etc., will do for other skills and value added in other types of positions in the public sector.

64 Albigensian December 1, 2016 at 5:42 pm

In most skilled jobs, one will earn more each year for perhaps the first five years or so. But after that, your pay is likely to plateau, unless you also begin to take on additional responsibilities.

Yet this is not so in teachers’ union contracts, where “years of service” just never stop. The result of this is that while a 20+ year teacher may be worth more than a 5-year teacher, the difference in pay is so great that the 5-year teacher is a far better deal. Even assuming that the additional 15 years of service has improved performance, which may not be the case.

Of course, the unions know that- and prevent the natural consequence of that (school boards firing overpaid teachers) by requiring retention by seniority.

So, yes, the “probably better’ becomes questionable after a number of years (unless the job itself changes to include more responsibilities) but in any case, the question of value will always depend on price as well as quality.

65 Cee-Jay December 1, 2016 at 9:19 pm

Union represented employees are generally paid based on factors other than performance. Represented employees may have to demonstrate basic qualifications for a given job, but beyond that they will generally be awarded a job they bid for based on seniority (as opposed to being the person mostly likely to perform well in that job). Sometimes represented jobs have built in step increases, in which pay increases simply due to time in job, even though the underlying work being performed has not changed and the employee is not necessarily performing at a higher level. These step increases are in addition to what might be thought of as cost of living increases or general wage adjustments.

Typically non-represented jobs, at least professional ones, are paid based on perceived performance. It is not uncommon for a high performing employee to make more than somebody with more experience but who does not perform as well. Likewise, it is not uncommon for moderately performing middle aged professionals to reach their peak level and to get relatively small pay increases in the later part of there life.

66 Troll me December 2, 2016 at 12:32 am

All true.

But think of what’s going on within the organization.

There are people making decisions, and they hope for these decisions to reflect well on them so that they can advance in the company. Presumably when they are choosing who to transfer, promote, etc., the people making the decision of “this is the person i want” prefer to surround themselves with competent people.

Unless, perhaps, they are satisfied to create some fiefdom at the 2nd or 3rd level of management and so keep out anyone that could make them look bad …

67 rayward December 1, 2016 at 2:11 pm

Attitudes about public employees, including teachers, are explained by the theory of relativity: relative to non-public employees, public employees enjoyed job and wage protection. Misery loves company.

68 Brian Donohue December 1, 2016 at 2:14 pm

You can put a price tag on that and adjust wages accordingly (hint: it’s worth quite a bit.)

Fifty years ago, everyone understand this trade-off in public sector employment, but we’ve lost sight of it somewhere along the way.

69 Hazel Meade December 1, 2016 at 2:36 pm

Their job and wage protection costs me money. Public employees salaries are paid by tax dollars.

70 Troll me December 1, 2016 at 2:44 pm

If job security were no long relevant, then you’d have to pay a lot more money to attract people.

Wanna set your career and life aspirations on a public sector job that pays 30k, offers zero job security, and has a highly politicized hiring and firing routine?

71 A Definite Beta Guy December 1, 2016 at 4:34 pm

Roflmao, plenty of private sector people have positions exactly like. Regardless, we don’t need to pay teachers on average of $30k: how about just bumping it down from an average of $70k per year plus a pension that pays out 60% of your last 5 year salary (with guaranteed 6% raises your last 2 years) that you only pay 2% of your base salary to fund through your entire career, AKA Illinois schools?

72 Troll me December 1, 2016 at 5:45 pm

Yes, there are jobs in the private sector like that.

What does that have to do with compensation packages offered to teachers? The market for teachers is not very similar to the market for landscaping labourers, for example.

73 chuck martel December 1, 2016 at 2:39 pm

All public employees, teachers included, should have to bid for their jobs annually. The low bidder, wages and fringes combined, should be awarded the position. That’s the selection process for everything else, why not teachers?

74 msgkings December 1, 2016 at 2:45 pm

Why not all private employees as well?

75 The Anti-Gnostic December 1, 2016 at 4:27 pm

They do.

76 chuck martel December 1, 2016 at 4:31 pm

A private employer pays the compensation that he and the employee agree upon. If the employer makes a deal that the business won’t support it goes bankrupt. That hasn’t been the case with the public sector, although the handwriting is on the wall in places like California where public employees have retired at age 48 with six figure benefits. Since the courts say these arrangements can’t be modified some California cities will be forced to simply dissolve and be re-configured as different entities.

77 Todd K December 1, 2016 at 2:50 pm

Does this include tenured teachers at state schools like GMU? TylerC and AlexT would sail through but BryanC would be tossing and turning at nights. RobinH has already uploaded himself into an Em so is indifferent.

78 Troll me December 1, 2016 at 2:57 pm

And if the outcome is that all the best teachers are given good reason to consider other jobs every year, and only the worst teachers stay in the game?

79 Adam December 1, 2016 at 3:01 pm

You would get the same problem banks and sports teams have. Select those who randomly performed above their average last year and enjoy paying above average wages for their below average performance this year

80 OldCurmudgeon December 1, 2016 at 2:39 pm

“exogenous timing differences based on contract renewal dates, ”

I’m not sure it’s really a random sample. If I recall correctly, some school districts rushed to close contracts before the law took effect, while others stalled. Presumably, the first group of school boards were more pro-union than the other.

81 Philip Crawford December 1, 2016 at 3:13 pm

Bingo. (I live in Madison.)

82 we live in interesting times December 1, 2016 at 9:51 pm

Milwaukee, too!

83 The Anti-Gnostic December 1, 2016 at 4:28 pm

Public sector unions should not exist, period. The labor-capital dynamic which supposedly justifies the NLRA does not apply, nobody is forced to work for the government, and it gives public sector employees another vote in addition to the two they already have.

84 required December 6, 2016 at 6:36 pm

Private sector unions should exist, but “right to work” supporters hate private sector unions, yet they love public sector unions.

85 The Original Other Jim December 1, 2016 at 6:02 pm

>The analysis shows that the most experienced and highest paid teachers benefit most from unionization.

But don’t call it a Ponzi scheme!

That would be wildly accurate. I mean, that would be divisive.

The single easiest way to improve Government would be to end public sector unions. We’ll see if anyone now has the nads to do it. (Or the ovaries.)

86 The Free Market Is Not God December 1, 2016 at 6:05 pm

Everything in our society is silent politically except the issues that political parties find useful to get votes or donations. We can talk about how much teachers are paid, because that is a taxpayer expense. We can talk about whether teachers should be allowed to unionize because unions may increase taxpayer expenses. We can talk about Common Core or Charter Schools. Because Common Core is believed to be a “quick fix” believed to decrease taxpayer expenses, by delivering quality inexpensively. And because Charter School operators are sources of political donations.

But school systems and their quality, or lack thereof, have many aspects, other than simply taxpayer expenses, or political donations from charter school operators, or “quick fixes” that usually do not work because the people suggesting them have looked only superficially at the issues.

87 j mct December 1, 2016 at 6:31 pm

Did the guy figure in that they found out that the WEA (wisconsin edu assn) was ripping off many school districts by making them buy very overpriced WEA health insurance for their employees as part of the collective bargaining agreements? I’d think that stopping that, which happened right away after benefits were excluded from collective bargaining, funny how the WEA fought so hard for that contract provision, would look like a cut in comp but really wouldn’t be. If he didn’t figure that in, his numbers are off.

88 The Free Market Is Not God December 1, 2016 at 8:37 pm

It’s interesting that private sector unions are almost extinct now, and the public sector unions are what is left. Does anyone know why that is? Of course Republicans being faithful servants of mega-corporation owners, are glad to destroy the union power of workers in corporations. If they could re-instate slavery and indentured servitude, they would. But why not public unions too?

Do public sector union members vote more than private sector union members, and thus legislators are reluctant to screw them over, like private employees?

Or is it that, since the public sector is government,–and government is the middle man between crony capitalists and the taxpayers whose money supports crony capitalists’ business subsidies, tax exemptions, government contracts to destroy foreign countries and then rebuild them etc. So crony capitalists make out like bandits, and Congress and state legislators make out like bandits’ assistants. And the whole public sector is composed of (mostly junior level) bandits’ assistants who must also be supported?

Is that how it goes? Any opinions?

89 derek December 1, 2016 at 11:44 pm

The same situation exists in Canada. Those evil Republicans.

The problem is simply that businesses with unions have trouble adjusting to market conditions. Higher costs, ridiculous work rules are simply Chinese National Full Employment Strategy implementations.

90 Troll me December 2, 2016 at 8:58 pm

There’s this logic that companies get the unions they deserve.

I’ve known a few people who ran businesses in industries which were heavily dominated by unions. So they had to be very intentional in having employee retention and reward efforts to a) keep people from going to a union outfit and b) them not wanting to bring the small workforce under union representation.

So … if there’s that whole level of union management, being slightly an outsider you can pay workers more than the union and still have lower overall costs. Other “be happy” stuff according to the working culture can be more easily tailored in such a smaller environment.

Anyways, points being 1) if you’re in a low-unionization industry and your workers unionize, you probably deserved it, and b) if you’re in a high unionization industry, you can save money and pay more at the same time.

91 Troll me December 2, 2016 at 8:59 pm

Oh, but you’ve gotta be really good. Because most companies will call the union shop because it comes with a quality guarantee of sorts.

92 Thiago December 1, 2016 at 10:56 pm

Worth checking Barbara Biasi’s paper on the same topic, on the job market this year from Stanford: http://web.stanford.edu/~bbiasi/jmp.pdf

This paper exploits the passage of Act 10 in Wisconsin in 2011, which changed the scope of collective bargaining on teacher salaries, to study the effects of changes in pay on teachers’ labor market, and on the composition of the teaching workforce. As a result of this law some districts started to individually negotiate salaries with each teacher, whereas other districts continued setting salaries using seniority-based schedules.
I first document an increase in salary dispersion in individual-salaries districts, and show that it is correlated with teacher value added. Teachers responded to changes in pay by sorting across districts or by exiting: I find a 34 percent increase in quality of teachers moving from salary schedule to individual-salary districts, and a 17 percent decrease in quality of teachers exiting
individual-salary districts.

93 jorod December 2, 2016 at 12:23 am

Nonsense. Unions protect mediocrity. Public workers have 2 hour lunches as the norm. Teachers may be an exception but they only work 8 months a year. In state government my experience is that 20% of the workers do 90% of the work. Minorities can’t be fired no matter how unproductive they are. Public unions conspire with politicians and bureaucrats to rape the taxpayer. We need to put an end to public unions. And private unions should not be allowed to control an entire industry. They should be one union for each company to avoid labor cartels like we have in Chicago.

94 NT December 2, 2016 at 11:04 am

School funding is more complex than just government throwing money into education pool.

Here is a neat read on the subject.

https://priceonomics.com/how-investment-banks-cash-in-on-school/

95 Harun December 2, 2016 at 11:29 am

“Most experienced” can mean a lot of things, but if its merely based on years in service it can be a dangerous metric.

Time servers can be horrible teachers. Burned-out teachers can be horrible teachers.

My kid has a math teacher who makes the kids read the book out loud as “teaching” and doesn’t do any examples, etc. This person probably started out as a real teacher, but is burned out. She probably would like to try something else, but that pension and those bennies are calling.

So, she’ll fake being a teacher for 10 more years.

Better for teachers to have 401K’s instead and let them move on if they burn out.

96 Troll me December 2, 2016 at 8:53 pm

I think math is a subject that you might get quite a lot better at teaching over time. You’ll figure out lots of tips and tricks for all sorts of different learning styles and problems.

But by the time you’ve taught the battle of Gettysburg or Macbeth for the 30th time, I assume a little less excitement or interest is transmitted in the process.

97 required December 6, 2016 at 6:49 pm

It’s also the reason why professors say that :
(1) teaching lower division is more boring than teaching upper division,
(2) teaching upper division is more boring than teaching graduate classes,
(3) teaching graduate classes is more boring than guiding research students.

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