Podgursky_REL_DC_feb08 by liwenting

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									Teacher Pensions, Incentives,
and Labor Market Behavior:
A Descriptive Analysis


Michael Podgursky, University of Missouri - Columbia
Robert Costrell, University of Arkansas – Fayetteville
Mark Ehlert, University of Missouri- Columbia

Center for Analysis of Longitudinal Data in Education Research (CALDER)
National Center for Performance Incentives (NCPI)


   REL Directors Meeting
   Washington DC
   Feb. 7, 2008


                                                                          1
Why study teacher retirements?
• Teacher retirements generate vacancies
• Teacher retirements generate costs
   – Teacher pensions
   – Retiree health insurance
• Incentives in retirement systems may have
  significant effects on labor supply and mobility
   – Pension system incentives are large
• Retirement systems can affect the quantity and
  quality of the teaching workforce

                                                     2
    New Vocabulary for Ed Policy and
           School Finance
•   OPEB’s
•   UAAL
•   PLOP, DROP
•   Present value
•   Discount rates
•   GASB 43,45


                                       3
                         Recent Reports
• Promises with A Price: Public Sector Retirement
  Benefits (Pew Foundation)
   –   http://www.pewtrusts.org/uploadedFiles/wwwpewtrustsorg/Reports/State_policy/pension_report.pdf



• Funding Pensions and Retiree Health Care for Public
  Employees California Public Employee Post-
  Employment Benefits Commission
   – http://www.pebc.ca.gov/images/files/final/080107_PEBCReport2007.pdf




                                                                                                        4
       Fiscal Context: Increasingly Expensive
                                               Ohio Teacher Retiree Benefit Costs
                                                                                                                        increase
                             Figure 1. Employer and Employee Contributions to STRS                                      proposed
                                                                                                                        by STRS
                    30.00%




                    25.00%




                    20.00%
percent of salary




                                                                                                employee

                    15.00%




                    10.00%



                                                                                               employer
                    5.00%




                    0.00%
                        20
                        23
                        26
                        29
                        32
                        35
                        38
                        41
                        44
                        47
                        50
                        53
                        56
                        59
                        62
                        65
                        68
                        71
                        74
                        77
                        80
                        83
                        86
                        89
                        92
                        95
                        98
                        01
                        04
                        07
                        10
                                                                                                                                   5
                      19
                      19
                      19
                      19
                      19
                      19
                      19
                      19
                      19
                      19
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                      19
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                      19
                      19
                      19
                      19
                      19
                      19
                      19
                      19
                      19
                      19
                      19
                      20
                      20
                      20
                      20
                                      note: employer contribution includes a contribution to retiree health care fund
               Research literature
• Large labor economics literature on pensions and retirements
• Very small literature on teachers
   – Furgeson, Strauss, Vogt (2006), PA teachers
   – Brown (2006), CA teachers
   – Harris and Adams(2007), CPS
• Absence of basic data
   – Character of systems (incentives)
       • Type of benefits and costs (esp. retiree HI, NCS)
       • Parameters of systems (NEA and NASRA incomplete, Loeb and Miller,
         2006))
       • Incentive structure of teacher pensions
   – Teacher labor market data
       • HRS (too small for teachers)
       • SASS TFS
       • Longitudinal state data (SEA records linked to pension data)



                                                                             6
            Teacher Pensions:
              Stylized Facts
• Mostly state-wide systems
• Roughly 70 percent of teachers are in Social
  Security. Generally state decision.
• Nearly all teachers are in Defined Benefit (DB)
  plans. DC and CB options very limited
  – DC = Defined Contribution (e.g., IRA)
  – CB = Cash Balance
• Mean retirement age is well below Social
  Security and Medicare ages
  – 58 years (retired and stopped teaching, SASS TFS)

                                                        7
    Incentives in Teacher Pension
             Systems
•   In public sector DB pension systems accrual of
    pension wealth is highly non-linear and back-
    loaded
•   State systems generally have sharp “spikes” in
    accrual rates
    –   Pull teachers to spike
    –   Push out after
•   Not inherent in DB pension systems.
    –   “cash balance” (IBM and other firms)
    –   Can smooth spikes

                                                 8
 Typical DB teacher pension


Annual
Pension = S x FAS x r(S,A)

S = service years
FAS = final average salary
r(S,A) = replacement factor

When do payments start? (A/S)
                                9
                       Table 1
                       Key Features of Selected State Defined Benefit Teacher Pension Plans



                                              Lots of moving parts…
                       Ohio                    Arkansas              California             Massachusetts       Missouri             Florida




In Social              No                      Yes                   No                     Yes                 No                   No
Security

Vesting (years)        5                       5                     5                      10                  5                    6

Retirement             Age=60; or              Age = 60; or          Age = 55; or           Age = 55; or        Age = 60; or         Age=62; or
Eligibility            Age=55 if Service =     Service = 25          Age = 50 if Service    Service = 20        Service = 30; or     Service=30; or
                       25; or                                        = 30                                       Age + Service = 80   Age<62 and
                       Service = 30                                                                                                  Service<30 w/ 5%
                                                                                                                                     reduction in
                                                                                                                                     annuity for every
                                                                                                                                     year under 62

Contribution Rates     District 14%            Employer 14%          District 8.25%         State, varies       District 11.5%       State, varies
                       Teacher 10%             Teacher 6%            Teacher 6%*            Teacher 11%         Teacher 11.5%        District 8.69%
                                                                                                                                     Teacher 0%

Replacement factor     Yrs 1-30: 2.2%          2.15% + $900          Linear segments:       Linear:             2.5%                 Linear Segments:
(percent per year of   Yr 31: 2.5%             For S < 28, benefit   1.1% at age 50         0.1% at age 41 to                        1.60% at or before
service)               Yr 32: 2.6%, …          reduced 5% x (28-S)   1.4% at age 55         2.5% at age 65                           age 62 or 30 years
                       For S ≥ 35,                                   2.0% at age 60         For S ≥ 30,                              1.63% at age 63 or
                       add 6% to total                               2.4% at age 63         add 2% x (S-24)                          31 years
                       For S < 30 and age <                          For S ≥ 30, add        Max replacement =                        1.65% at age 64 or
                       65, adjustment %                              0.2% to factor, to     80%                                      32 years
                       applies                                       max of 2.4%                                                     1.68% at age 65 or
                                                                                                                                     33 years

COLA formula           3%, simple              3%, simple            2%, simple, plus       CPI to max of 3%,   CPI, compound, up    3% Compound
                                                                     floor of 80% initial   simple,             to 1.80 maximum
                                                                     purchasing power       on first $12,000    factor


                       Sources: State pension fund web sites.
                       * An additional 2% contributes to a supplemental defined contribution plan.
                                                                                                                                                          10
      Pension Wealth
        (Annuity)

Pension           Pension
Payment           Wealth




                            11
• Compute pension wealth at each year of
  work life
• Compute growth of pension wealth from
  an addition year of work
• Representative teacher
  – Enters at 25, continuous spell of work
  – Standard assumptions concerning PV of
    pension wealth. (see Costrell and Podgursky (2007) )

                                                           12
                                             Ohio, Columbus Teacher Salary Schedule

                                                    Figure 3. Pension Wealth, in Inflation-Adjusted Dollars
                                                               age of first pension draw indicated

                                $1,400,000

                                                                                                                                                                                        62 63 64
                                                                                                                                                                                  60 61
                                $1,200,000                                                                                                                                                         65

                                                                                                                                                                                  59
                                $1,000,000                                                                                                                                57 58
adjusted for inflation, $2007




                                                                                                                                                                     56
                                                                                                                                                                55

                                                                                                                                                               55
                                 $800,000

                                                                            Age of pension draw                                                           55

                                 $600,000                                                                                                            55
                                                                                                                                                55

                                 $400,000                                                                                                  55

                                                                                                                                 60
                                                                                                                                      60         Age at separation
                                                                                                                            60
                                                                                                                    60 60
                                 $200,000                                                                   60 60
                                                                                                       60
                                                                                              60 60
                                                                                        60 60
                                                                         60 60 60
                                                             60 60 60 60
                                     $-
                                             25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65
                                                                                               age at separation (entry age = 25)
                                                              (Assumptions: 2006-2007 Columbus Public Schools Salary Schedule, all cells assumed to grow at 2.5% inflation,
                                                                COLA = 3%, interest rate = 5%, unisex 2003 Mortality Table from IRS Revenue Ruling 2002-62 Appendix B.)

                                                                                                                                                                                                   13
                                                         Ohio
                                                      Figure 4. Pension Wealth as Percent of Cumulative Earnings
                                                                    age of first pension draw indicated

                                 45%


                                 40%
                                                                                                                                                        56                60
                                                                                                                                                   55        57 58
                                                                                                                                                                               61
                                                                                                                                                                                    62
                                                                                                                                                                     59
                                 35%                                                                                                              55                                     63
                                                                                                                                                                                              64
                                                                                                                                             55
percent of cumulative earnings




                                                                                                                                                                                                   65
                                 30%
                                                                                                                                        55
                                                                                                                                   55
                                 25%
                                                                                                                              55


                                 20%

                                                                                                                         60
                                                                                                                   60 60
                                 15%                                                                      60 60 60
                                                                                                  60 60
                                                                                            60 60
                                                                                    60 60
                                                                               60
                                 10%
                                                                      60 60 60
                                                              60 60
                                                        60 60
                                 5%


                                 0%
                                       25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65
                                                                                       age at separation (entry age = 25)
                                                                                                (Assumptions: see Figure 3)
                                                                                                                                                                                                    14
                                             Figure 5: Annual Deferred Income, in Inflation-Adjusted Dollars
                                                           age of first pension draw indicated

                                $125,000
                                                                                                                          55                   55
                                                                                                                                                          60

                                $100,000                                                                                                  55
                                                        Addition to pension wealth
                                                                                                                                         55
                                 $75,000
                                                        from an additional year of
                                                                                                                                    55
                                                        Teaching (in dollars)                                                  55
adjusted for inflation, $2007




                                 $50,000



                                 $25,000
                                                                                                       60    60 60 60 60
                                                                                  60 60 60 60 60 60 60
                                                             60 60 60 60 60 60 60
                                                                                                                                               56 57 58
                                    $-
                                          25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65
                                                                                                                                                59
                                $(25,000)                                                                                                             61 62
                                                                                                                                                            63
                                                                                                                                                               64
                                $(50,000)

                                                                                                                                                                65
                                $(75,000)
                                                                                      age at separation (entry age = 25)
                                                                                            (Assumptions: see Figure 3)

                                                                                                                                                                     15
                                               Figure 6. Annual deferred income, as % of earnings
                                                         age of first pension draw indicated

                    200%


                                                                                                            55

                                                                                                                                55
                                                                                                                                                     60
                    150%
                                            Addition to pension wealth
                                            from an additional year of                                                     55
                                                                                                                       55
                                            Teaching (as % of earnings)
                    100%                                                                                              55
percent of salary




                                                                                                                 55




                    50%


                                                                                                    60 60
                                                                                           60 60 60
                                                                          60 60 60 6060
                                                                 60 60 60
                                               60 60 60 60 60 60
                     0%                                                                                                              56 57 58
                           25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65
                                                                                                                                                59
                                                                                                                                                          61 62
                                                                                                                                                                  63

                    -50%                                                                                                                                               64
                                                                       age at separation (entry age = 25)
                                                                              (Assumptions: see Figure 3)                                                                   16
17
                             Increment to PV of Pension Wealth from Working an Additional Year:
                             Missouri

                    200%
                                                                                                                               53



                                                                                                                          54


                    150%
                                                                                                                     55


                                                                                                                56

                                                                                                                                    53
                                                                                                           57
                    100%
percent of salary




                                                                                                      58


                                                                                                 59



                    50%

                                                                                            60
                                                                                       60                                                                   After 2001
                                                                                  60 60                                                     56
                                                                            60 60
                                                                      60 60
                                                             60 60 60
                                               60 60   60 60                                                                        54 55
                     0%
                           25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65

                                                                                                  Before 2001
                                                                                                                                            57
                                                                                                                                                 58
                                                                                                                                                      59
                                                                                                                                                           60 61
                                                                                                                                                                   62 63
                    -50%                                                                                                                                                   64

                                                                        age at separation (entry age = 25)




                                                                                                                                                                    18
                                                  Figure 2B. Annual deferred income: Arkansas
                                                         age of first pension draw indicated

                    500%
                                                                                                          50



                    400%



                    300%
percent of salary




                    200%



                    100%
                                                                                                               51 52 53
                                                                                         60 60 60 60 60
                                                                             60 60 60 60
                                               60 60 60 60 60 60 60 60 60 60
                      0%
                             25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65



                    -100%
                                                                      age at separation (entry age = 25)
                            Source: Costrell and Podgursky (2007)
                                                                                                                                                          19
                                              Figure 2C. Annual deferred income: Massachusetts
                                                        age of first pension draw indicated

                    300%
                                                                                                                         55
                                                                                                                                 since
                                                                                                                                 2001
                    250%


                    200%
percent of salary




                    150%


                    100%
                                                                                                                                56 57
                                                                                                                                        58
                                                                                                                   54 54 54 55 56 57 58
                     50%                                                                       54 54 54 54 54 54                        59 60
                                                                                    55 55 54                                                    61
                                                             55 55 55   55 55 55 55                                        prior to
                                                                                                                            2001                 62
                      0%
                            25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65
                                                                                                                                  59
                    -50%

                                                                                                                                             60 61 62 63 64 65
                    -100%
                                                                     age at separation (entry age = 25)




                                  Source: Costrell and Podgursky (2007)
                                                                                                                                                                 20
                                                 Figure 2D. Annual deferred income: California
                                                        age of first pension draw indicated

                    200%



                                                                                                                              56
                    150%
                                                                                                        since 1999
percent of salary




                    100%


                                                                                                        57                        56
                                                                                                                                       57 58
                                                                                                                                             59 60 61
                    50%                                                                                                      57
                                                                                                                                  57
                                                                                                                        57
                                                                                       57 57 57 57 57              57        prior to
                                                                                                             57 57
                                                                              57 57 57
                                                                  57 57 57 57                                                 1999
                                             57 57 57 57 57 57 57
                                                                                                                                                        62

                     0%
                           25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65


                                                                                                                                                  61 62
                                                                                                                                                             63
                                                                                                                                                                  64 65
                    -50%
                                                                    age at separation (entry age = 25)




                                 Source: Costrell and Podgursky (2007)
                                                                                                                                                                          21
                                               Figure 6. Annual deferred income, as % of earnings
                                                         age of first pension draw indicated

                    200%
                                                                          Ohio

                                                                                                            55

                                                                                                                                55
                                                                                                                                                     60
                    150%

                                                                                                                           55
                                                                                                                       55


                    100%                                                                                              55
percent of salary




                                                                                                                 55




                    50%


                                                                                                    60 60
                                                                                           60 60 60
                                                                          60 60 60 6060
                                                                 60 60 60
                                               60 60 60 60 60 60
                     0%                                                                                                              56 57 58
                           25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65
                                                                                                                                                59
                                                                                                                                                          61 62
                                                                                                                                                                  63

                    -50%                                                                                                                                               64
                                                                       age at separation (entry age = 25)
                                                                              (Assumptions: see Figure 3)                                                              22
                              Figure C2. Deferred Income as Percent of Salary: Entry ages 22, 25, 30

                    400%


                    350%


                    300%


                    250%
                                                                                                                     30
percent of salary




                    200%
                                                                                                        25
                                                                                               22
                    150%


                    100%


                     50%


                      0%
                            25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65

                    -50%


                    -100%
                                                                                age at separation
                                                                              (Assumptions: see Figure 3)

                                                                                                                                                     23
     Intended Consequences
• Do pension incentives affect retirement
  behavior?




                                            24
   Missouri Longitudinal Teacher Data File
      (excluding KC and STL districts)



1990-91                                  2005-06
A + E ≥ 45
Full-Time
Teachers
N= 31,060



                    21,240
                    Retirements
                                                   25
           Distribution of Age + Experience: Missouri

                                              Frequency Distribution of Age + Missouri Experience
                                                                  "Rule of 80"

          9.0


          8.0


          7.0


          6.0


          5.0
Percent




          4.0


          3.0


          2.0


          1.0


          0.0
                47
                     49
                          52
                               54
                                    56
                                         58
                                              60
                                                   62
                                                        64
                                                             66
                                                                  68
                                                                       70
                                                                            72
                                                                                 74
                                                                                      76
                                                                                           78
                                                                                                80
                                                                                                     82
                                                                                                          84
                                                                                                               86
                                                                                                                    88
                                                                                                                         90
                                                                                                                              92
                                                                                                                                   94
                                                                                                                                        96
                                                                                                                                             98
                                                                                                                                                  100
                                                                                                                                                        102
                                                                                                                                                              104
                                                                                                                                                                    106
                                                                                                                                                                          108
                                                                                                                                                                                110
                                                                                                                                                                                      112
                                                                                                                                                                                            114
                                                                                                                                                                                                  116
                                                                                                                                                                                                        118
                                                                                                                                                                                                              120
                                                                                                                                                                                                                    122
                                                                                                                                                                                                                          125
                                                                                                                                                                                                                                127
                                                                                                                                                                                                                                      134
                                                                                                          Age + MOEXP




                                                                                                80
                                                                                                                                                                                                                                            26
                Increment to PV of Pension Wealth from Working an Additional Year:
                                            Missouri
                                                                                       53



                                                                                  54



                                                                             55
                                                                                                    r = 2.5% S ≤ 30
                                                                        56                          r = 2.55% S ≥ 31
                                                                                            53
                                                                   57

                                                              58
                                                                                                    Changed in
                                                                                                    July 2001
                                                         59




                                                    60
                                               60                                                                   After 2001
                                          60 60                                                     56
                                    60 60
                              60 60
                     60 60 60
       60 60   60 60                                                                        54 55


9 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65

                                                          Before 2001
                                                                                                    57
                                                                                                         58
                                                                                                              59
                                                                                                                   60 61
                                                                                                                           62 63
                                                                                                                                   64

                                age at separation (entry age = 25)



                                                                                                                                        27
                    Replacement Factor      Marginal Gain
Years Experience        (after July 2001)      in Annuity
    at Retirement            % of Salary      % of Salary
               30                    2.50             2.50
               31                    2.55             4.05
               32                    2.55             2.55




                                                             28
                  Distribution of Years of Experience at Retirement
                  Before and After 2001 Change In Replacement Rate
          17.00

          16.00

          15.00

          14.00

          13.00

          12.00

          11.00

          10.00
Percent




           9.00                                                  1995-2000
                                                                 2002-2006
           8.00

           7.00

           6.00

           5.00

           4.00

           3.00

           2.00

           1.00

           0.00
                   1
                   2
                   3
                   4
                   5
                   6
                   7
                   8
                   9
                  10
                  11
                  12
                  13
                  14
                  15
                  16
                  17
                  18
                  19
                  20
                  21
                  22
                  23
                  24
                  25
                  26
                  27
                  28
                  29
                  30
                  31
                  32
                  33
                  34
                  35
                  36
                  37
                  38
                  39
                  40
                  41
                  42
                  43
                  44
                  45
                  46
                  47
                  48
                  49
                  50
                  51
                  56
                                                                             29
                                           MOEXP
                   Retirement Hazard function: Before and After 2001 Enhancement

0.4500


0.4000


0.3500


0.3000


0.2500


0.2000


0.1500


0.1000


0.0500


0.0000
         20   21   22   23   24   25    26    27      28        29      30   31   32   33   34   35        36
                                                   Experience

                                             data_9500      data_0206


                                                                                                      30
                    Replacement Factor Marginal Gain
Years Experience        (after July 2001)  in Annuity Distribution of Retirees, %
    at Retirement            % of Salary  % of Salary 1995-00 2002-06 change
               30                    2.50        2.50      16.00      11.40      -4.60
               31                    2.55        4.05       7.60      10.60       3.00
               32                    2.55        2.55       4.60       6.00       1.40




                                                                                 31
   Unintended Consequences I
• Retiree Health Insurance
  – Medicare eligibility at 65
• OPEB/ GASB 43, 45
  – Usually unfunded
  – Initial estimates very large for some districts/states
  – Ohio, combined contribution 24%, STRS requests 5
    percent increase
  – LAUSD $10b UAL (100 % coverage – teacher and
    spouse)


                                                             32
                             2006 GASB 45 Estimates, LAUSD




http://notebook.lausd.net/pls/ptl/docs/PAGE/CA_LAUSD/FLDR_ORGANIZATIONS/COMMITTEE_MAIN/ABT_HOME/ABT_AGENDA/ITEM
%203%20-%20HWACTUARIAL.PDF
                                                                                                                  33
34
1.   What OPEB’s have been promised?
2.   What is their cost?
3.   NCES survey on (1)
4.   GASB 43, 45 require reporting of (2)




                                            35
  Unintended Consequences II
• Retired (Collecting teacher pension)
• Retired and not teaching
• “Double Dipping”
  – DROP
  – withdrawal
  – change pension systems
  – part time teaching
• How extensive (???)
                                         36
Structure of SASS Teacher Follow Up Survey




                   Current
                   Teacher
                   Survey
  SASS
  Teacher
  Follow-Up
  Survey
  2003-04
                   Former     Collecting Teacher
                   Teacher    Pension?
                   Survey




                                                   37
           Cumulative Distribution of Teacher Retirement Ages:
           Teacher Follow Up Surveys, Schools and Staffing Surveys,
           2001 and 2005

                     100


                      90


                      80                                              58
                      70
Cumulative Percent




                      60


                      50                                                                                                                                            TFS 2001
                                                                                                                                                                    TFS 2005

                      40


                      30


                      20


                      10


                       0
                           50 or younger

                                           51

                                                52

                                                     53

                                                            54

                                                                 55

                                                                       56

                                                                             57

                                                                                  58

                                                                                        59

                                                                                              60

                                                                                                   61

                                                                                                         62

                                                                                                               63

                                                                                                                    64

                                                                                                                          65

                                                                                                                                66

                                                                                                                                       67

                                                                                                                                            68

                                                                                                                                                 69

                                                                                                                                                      70 or older
                                                                                             Age


                                                          Source: Schools and Staffing Surveys: 2001 & 2005 Teacher Follow Up Survey
                                                                                                                                                                        38
                     Retirement Age in Missouri and the US:
                     Missouri and SASS Teacher Follow Up Survey 2001.

                     100.0



                      90.0



                      80.0



                      70.0



                      60.0
Cumulative Percent




                      50.0                                                                                                                                          MO
                                                                                                                                                                    TFS 2001


                      40.0



                      30.0



                      20.0



                      10.0



                       0.0
                             50 or younger


                                             51


                                                  52


                                                       53


                                                               54


                                                                     55


                                                                          56


                                                                                57


                                                                                      58


                                                                                           59


                                                                                                  60


                                                                                                       61


                                                                                                            62


                                                                                                                 63


                                                                                                                       64


                                                                                                                             65


                                                                                                                                  66


                                                                                                                                       67


                                                                                                                                            68


                                                                                                                                                 69


                                                                                                                                                      70 or older
                                                                                                Age

                                                            Source: Schools and Staffing Surveys: 2001 & 2005 Teacher Follow Up
                                                            Survey                                                                                                         39
                                                              Retirement Age in Missouri and the US:
                                                              Missouri and SASS Teacher Follow Up Survey 2001.

                     100.0


                                                  MO Age -
                      90.0                        Retired



                      80.0
                                                  MO Age -
                                                  Retired &
                                                  Quit
                      70.0                        Working


                                                  TFS 2001
                      60.0
Cumulative Percent




                      50.0



                      40.0



                      30.0



                      20.0



                      10.0



                       0.0
                                                              53



                                                                   54




                                                                                            57



                                                                                                   58




                                                                                                                          61


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                                                                                                                                                   65


                                                                                                                                                        66




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                                             51



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                                                                                                          59



                                                                                                                     60




                                                                                                                                        63


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                                                                                                                                                             67



                                                                                                                                                                  68




                                                                                                                                                                            70 or older
                             50 or younger




                                                                                                               Age


                                                                        Source: Schools and Staffing Surveys: 2001 & 2005 Teacher Follow Up
                                                                                                                                                                                          40
               Labor Market Experience of Teachers Who Retired in 2000-01:
               Percent of Teachers Working Full and Part-Time in Missouri
               Public Schools in Subsequent Years

14.0%




12.0%


                                                 PT

10.0%                                            FT




8.0%    8.6%




6.0%

                  8.7%
                             8.1%

                                        6.4%      6.3%
4.0%
                                                             5.0%       4.7%



2.0%
        3.6%


                  1.0%       1.0%       1.0%      1.0%       1.1%       1.1%
0.0%
        2001      2002       2003       2004      2005       2006       2007

                                                                               41
Structure of 2004-05 SASS Teacher Follow Up Survey

                            91.6%               5.3%
                                                (4.9% of total pop.)
                            Current
                            Teacher         Collecting Teacher
                            Survey          Pension?
    SASS
    Teacher
    Follow-Up
    Survey
    2003-04
                             8.4%
                            Former
                            Teacher
                            Survey




  MO 1.2 % of current teachers are collecting pensions


                                                                 42
                   What’s Needed
• Facts, facts, facts….
   – What’s been promised?
   – What are costs?
• What are options?
   –   Literature reviews / case studies
   –   Studies of state teacher data
   –   Policy simulations
   –   Transparency
• Regulatory space for experiments
   – Pilots & evaluations
   – Strategic compensation policy



                                           43
               References
• www.caldercenter.org
  – Costrell and Podgursky(2007)
  – Podgursky and Ehlert (2007)
• www.educationnext.net
  – Costrell and Podgursky(2007)
• Ohio report (Fordham foundation)
  – http://www.fordhamfoundation.org/institute/pu
    blication/publication.cfm?id=371

                                                44

								
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