During the pandemic, the US government approved billions of dollars in aid to help struggling public schools, but this money will expire next year, leaving school districts across the country with enormous budget shortfalls.
A lot of schools, we learned, put that money into what are called recurring expenses, things that are programs like tutoring and salaries that you have to pay for years on end, and school district officials now are starting to think about how they're going to pay for those things without the added cushion of the stimulus aid.
That's Reporter Nick Corolla, he and Shruti's seeing writ in Bloomberg City Lab that schools have used almost half those pandemic dollars to try to slow the nationwide exodus of underpaid, overworked teachers from the profession.
When we looked at the most recent government statistics on teacher pay, what we found in the twenty twenty one twenty twenty two school year, the average teacher salary was just under sixty six thousand, four hundred, and that was the lowest on an inflation adjusted basis since the nineteen eighty five nineteen eighty six school.
Year, and later we hear from one of those educators, Charles Ebaya, is a public school counselor in New York City.
Teachers are walking off the job because they're not getting paid enough. So I think when the money expires, because this is not if it's all, when the burden on the veterans teachers that are in schools is going to be higher, I think you might see higher rates of teacher burnout leaving the job for something better.
I'm west Kosova today on the Big Take. Public schools tried to fill a one hundred and ninety billion dollar hole. Nick. I think we're all familiar with the big challenges that schools all around the US face during the pandemic, but I gotta say your story paints a pretty bleak picture of what's coming next.
That's right. I think it's a really difficult time to be a school leader or a budget leader at a school district. As we all know, the pandemic caused numerous problems for school officials and parents and students, but school districts got more or less unprecedented amounts of aid from the federal government to help smooth some of the impact of the pandemic. The American Rescue Plan Act gave one hundred and ninety billion dollars worth of aid to schools,
and big districts across the country got massive sums. New York City received about seven billion dollars, and they had a lot of latitude to decide how they want to spend it. What we're seeing now is schools really start
to grapple with the next phase. This money is going to come to an end around next year, and a lot of schools, we learned, put that money into what are called recurring expenses, things that are not one time expenses like building a new stadium or you know, improving your school's facilities, but programs like tutoring and salaries that you have to pay for years on end, and school district officials now are starting to think about how they're
going to pay for those things without the added cushion of the stimulus aid.
Shruding Nick mentioned some of the things that this money was used for. Can you sort of paint us a picture of how school districts spent this money.
School districts had a lot of needs to begin with. The pandemic brought up some needs that they had never seen before, Like there was this emergency need to update, say HVAC and ventilation systems, and then there was a lot of other needs with learning loss that people are
still grappling with. And so the reoccurring expenses that Nick mentioned are things like intervention specialists, reading specialists that are not one time costs, like a brand new ventilation system in a school that might have been built decades ago. So that's one of the things that's happening, is that these school districts have had to grapple with these facilities and these learning needs.
We reported that about half of the stimulus money actually went towards wages, things like salary increases for teachers and other employees in school districts, in part to stem some of the loss of workers who've been working in school districts. A lot of schools in the US are grappling with pretty severe teacher shortages, and one of the easiest ways to try to combat that is to pay teachers and staff more.
And one of the things you report in the story is just how far teacher salaries have fallen in the last several decades.
Teacher salaries have been a topic of discussion for many years. There have been strikes around the country in past years related to higher pay, for example, but the highest inflation
in four decades has certainly impacted teacher salaries. And so when we looked at the most recent government statistics on teacher pay, what we found in the twenty twenty one twenty twenty two school years, the average teacher salary was just under a sixty six thousand, four hundred and that was the lowest on an inflation adjusted basis since the nineteen eighty five nineteen eighty six school year. That was roughly almost forty years ago. I mean that's when Ronald Reagan was president.
A big part of this is inflation. Obviously, inflation is eating into everyone's paycheck. We've reported a lot on the teacher shortage and some of its causes. I talked to teachers all the time who have summer jobs, they have second jobs, And when you think about how much added work these teachers had to do to deal with some of the emotional needs that the pandemic put on their students, it makes sense why some of them would be looking for jobs, maybe in the private sector or other industries.
So one of the reports that we looked at was
from McKenzie and Company. And that specifically talked about why teachers want to leave, and the pool of people that they surveyed was about more than eighteen hundred US teachers, school leaders, in school mental health professionals, and at the end of the twenty twenty one twenty two school year they said that something like a third of the survey respondents had planned to leave before the start of the next school year, and compensation was a major factor.
Given how much school districts really have come to depend on this money, why is it stopping next year?
That was the design of the federal stimulus package. These pieces of legislation gave humongous amounts of money to schools, but the encouragement, and in some cases the mandate attached to the money was that the schools use it to address learning loss or some of the added expenses that they had to bear because of the pandemic, things like air filtration and PPE.
When we talk about.
Learning loss, that's basically comparing a cohort of students to a similar cohort before the pandemic, trying to get a sense of how much they're learning in a given year. And the most recent testing data shows that the learning loss has far from been reversed and in some cases has even widened over the last year, which I think is surprising to a lot of experts who understood that this was going to be a long term issue, but
the scale of that decline is quite eye popping. Schools have known since the beginning that this is not a stream of money that will last forever, but also school district and budget officials they understood that this is short term money. But it's very hard to spend in a school district on short term things that are going to be really effective, like ways that you catch students up after learning loss. Lots of research shows that tutoring and
programs that are recurring are the most effective ways. So it was a really delicate balancing act that these budget officials had to do it.
Truly, so school districts all around the country are looking at this giant shortfall. Why are we talking about this now though, Because it doesn't really come into effect until a year from now.
School budgets are often crafted well in advance. Some of these school districts have projections for what is going to happen not only just next year, but several years past that, so they're already starting to think about what their revenue and their expenses are going to look like for the
next school year. Even though kids have just recently gone back to school and in the last few weeks, the budget officials are just starting to say, okay, well, next year, if I'm not going to be able to count on this federal revenue, my expenses aren't going down. What is that gap going to be?
Just to give you an example, New York by its own estimates, expects a shortfall of about seven hundred million dollars next year. That's because of the stimulus money they received. That's how much money they have funneled into recurring or
programmatic expenses. One really good example that comes to mind is the New York City early education program pre K and three K. Almost all of that program expansion has been funded by stimulus money, and it's a really important time sensitive question as to how they're going to pay for that when the stimulus expires.
In Chicago, the public school system here is staring down a cliff of about six hundred and twenty eight million for twenty twenty six. Now, Chicago public schools have been a system that had been stressed before the pandemic and this infusion of federal aid really did help bolster their financial situation, and now they're looking to go back to some situations that had stressed their budget to begin with.
So everyone sort of is looking at it at different times, but nevertheless it's coming for many school districts across the country.
When we come back, an inside view from an educator in New York City. Now, let's hear from someone who sees what we're talking about today every day. Charles Ebeya is a tenured English teacher and student counselor at a public school in the Bronx. Charles, New York City public schools got a lot of pandemic aid from the federal government. What is your school using that money?
For?
My understanding is that that money was used to fund more school counselors, social workers, school psychologists, all those positions that aide students, you know, in terms of their social emotional health, especially because coming back from the pandemic, so many students have been in homes for a year, year and a half, and I think there was an understanding that they were going to be coming back with a lot of trauma. Right, So many of my students are
title I students. So they are poor students, They live in small apartments, their families, you know, like large families in like one or two bedroom apartments, and for a lot of those students, school tends to be a safe space. And just like not having that space to go to for over a year and a half and then not
being able to go outside and see people regularly. I think there was just an understanding that these kids were going to come back with a lot of primary trauma, like maybe they lost family members due to COVID, and of course like secondary trauma, they're you know, stuck inside and there's a lot of isolation. They don't can't see their friends. So I think the push was hire more of that school based support staff in order to meet the needs of our students when they came back into the buildings.
Charles, and you are a school counselor what are you seeing in the schools now that they're back versus when kids were at home for the pandemic.
We're seeing a lot more behavior issues. We are recognizing that kids, because they were able to learn remotely now don't see value in being in the classroom the same way they did before. And I'm thinking back to my own experience when I was teaching eighth grade before I became a school counselor, you know, for many of my kids, they had been in school every year up until eighth grade, middle of eighth grade, and then all of a sudden
they learned, oh, we can learn over a computer. In the beginning, it was fun get to be home, you kind of get to be on zoom. I would say that that's probably the biggest, one of the biggest things that came out of the pandemic. It was nice to learn and we can learn remotely, but there were no rules or parameters that you could put on it that
would make it feel like regular school. And I think without having those rules of regular school, I think so many kids just lost the what's the word, just like the routine, you know, like because it is routine. And I think into the next school year when the deal we tried to do the hybrid model with some kids staying home and some kids being in the building. We saw the kids that were in the building, it wasn't as many of them. They still had to maintain distance.
For a lot of them, they felt like, well, I might as well stayed home. In my time as a school council. I've had kids who now who were close to graduating, who refused to come to school because they were saying, oh, can I just do the work remote because that was what they could do before. And then you saw a lot more like antisocial behavior. Right, kids are staying to themselves, they're not interacting with teachers. They haven't interacted with adults other than their families for so long.
And as much as we try to make it be a welcoming place, I think even as the adults in the building, we're concerned too, because like we don't want to get sick, we don't have the same kind of interactions with our kids like we used to. You don't want to give anybody a high five because you know, spreading germs. I think you saw a lot more like aggressive behavior, Like people are scared, so it's like stay away from me. You hear somebody cough. And these kids
are the kind of language they use. I won't use it on this podcast, but you know, like the things that they say to each other, and I think the fear made them say even meaner things. You call and it's like, oh my god, you got COVID. You'll stay away from me. You get a lot of that stuff.
New York City got a lot of this federal money. It will expire soon. Where are your concerns if that money is no longer there?
So, just like most jobs, I think this happens right, you get the last in or first out. So if there's no money in the budget to pay teacher salaries or keep people aboard, that means you have to let them go, right And in the Department of Education, it's called accessing. If you just don't have enough money to pay for teachers, that means you have to let them go, which means that now your school may be short staffed. Staff that you may have hired in order to meet
the means of all your students. Now you don't have that, and that means you have to start cutting someplace. That could mean cutting teacher salaries means letting teachers go, which means now the teachers that are in the building are stretched even thinner than they might have been. That could mean that teachers may have to pick up an extra period. It could mean less money for like power professionals. You know, when you have your special led students that need somebody
to be in the room with them. That could affect that if the special led teacher was one of the last few hired and you have to get rid of them. Now, the smaller number of teachers that you have have to teach others classes, and now you're just spreading people thin, right, And now those people who were okay and you know, had a good work life balance are now feeling burnt out because they're working an extra period. And we can already see around the country right teachers are walking off
the job because they're not getting paid enough. So I think when the money expires, because this is not if it's a when I think it's just going to be, the burden on the veteran teachers that are in schools is going to be higher. I think you might see higher rates of teacher burnout leaving the job for something better.
Charles, thanks for sharing your experience with us.
It's been my pleasure.
After the break, how declining enrollment is actually making this funding problem worse, Nick, So we're looking at some pretty scary shortfalls for a lot of school districts around the country. What are they doing to fill in the gap?
I spoke to a number of school districts for this story, and there are just as many answers as there are school districts in the US. So one example that comes to mind is Denver. They have seen sustained student declines. Like a lot of districts in the country, They're losing a good couple percentage points of their student body every year. That's partly because the cost of living is becoming unsustainable.
Some families wanted to move out of the public school system for better education prospects, but many have yet to see their enrollment bounce back, and that is a little bit counterintuitive. You would think that there's less students to educate, it becomes less expensive, But schools have a lot of fixed costs, so their janitors, their electricity bills, their maintenance, those things don't go down when the students go down, but they receive less money if there's fewer students. So
it's a really hard challenge for school budget officials. I talked to the CFO the Denver Public School system, who was very careful to allocate their money in ways that they thought were sustainable. They didn't put a lot of their money in recur expenses, but they did not sugarcoat it. I mean, this is going to be pretty difficult for them, especially if there's some sort of other issue that were to occur, if they have some big expense that is unexpected that pops up in the next couple of years.
Balancing the wage inflation with the end of the stimulus money is going to be really, really hard for a lot of these budget officials.
And if you look at enrollment trends, it's really not looking like long term that they're going to turn around. We looked at government statistics since the pandemic started, and as Nick mentioned, we haven't seen that significant bounce back.
There might be a little up and down, but when we look at projections going through twenty thirty one, the government projections show that enrollment, which peaked it about fifty point eight million students in the fall of twenty nineteen, may go down to something like forty six point nine million and twenty thirty one.
And one other point I'll just mention is that school district officials are very careful to throw around these words unless they're absolutely necessary. But really I think what's being talked about quietly is the possibility of layoffs and even worse, potential school closures. In some cases, it just becomes too uneconomical to operate a school in a place where enrollment is dropping so quickly, and those are very politically difficult, and they're really hard on the communities too. Closing a
school is that's like a community anchor. And so these are some pretty hard choices that are going to be facing school officials in the next couple of years.
Truely, if we're looking at shortfalls of hundreds of millions of dollars, even in a big city like New York, that's just more than a city is able to make up. So how are they going to do it? Even with layoffs, even with cutting back programs, it seems like they're still going to be in a very deep hole.
I think those challenges are long term. Some of the people that Nick and I spoke with mentioned that the fiscal cliff that people are talking about right now is not necessarily new to some of the school districts. They have long faced underfunding. They've long put out calls to state and federal officials for higher funding. So for some of them, they're just going back to that. They're going to argue the same points in the hopes that state and federal officials send more money to the classrooms.
Nick, one thing you write in the story is a possible bright spot that housing values have risen so much that that means that property taxes are going up to in schools in many places are funded by property taxes. Can that help in a significant way?
It definitely can. Schools are in large part funded by property taxes. And over the last five years, I think the media and property value has risen more than fifty percent. I mean, the housing market has just been on fire, and that means in one revenue stream, more money for schools. But again, those gains are not uniform. In some places
that's stronger than others. And in addition, part of the reason schools are losing students is because of that very problem, the property values are becoming too expensive.
Nick, we talked about the shortfall and teacher pay. You write that Los Angeles has tried to counter that with really big raises, and yet they're facing shortfalls. How were they able to balance those books?
So Los Angeles made the decision to give their teachers a twenty one percent raise spread out over the next three years in their most recent round of negotiations with their union, and that brings the average teacher salary in LA to about one hundred and six thousand dollars. That's a very high salary in Los Angeles obviously has one of the highest cost of living in the United States.
And the school's chief business officer, David Hart, is a well regarded expert in his field, and they're thinking was this is one of the most important expenses that a school pays, and that they would rather attract talent and fill some of the positions than have these big lingering expenses crop up down the line.
And sure do you if you compare that with a school district like Chicago where you are, it's a completely different picture, isn't it.
Yeah.
I mean in Chicago, the City of Chicago, the Chicago Board of Education, and the Chicago Teachers Union are going to enter into negotiations for a new contract next year. And four years ago, in right before the pandemic started, the Chicago Teachers Union actually led a eleven day strike asking for higher pay, more social workers and nurses in every single school building. And a lot of these topics that we've been talking about are going to converge in Chicago next year.
And you've written quite a bit about the Chicago Teachers' Union, which is a very active union. What role are they playing in all of this.
Well, the Chicago Teachers' Union is seen as one of the most powerful political forces in the city of Chicago. The current mayor, Brandon Johnson, who was elected earlier this year and took office in May, is actually a former social studies teacher who was a union organizer for the Chicago Teachers' Union. So this coming negotiation next year is going to be closely watched to see how that all plays out.
Nick obviously a very big, complicated problem here, without a whole lot of solutions and a bill coming Doe in just a year's time. Is there any talk that the federal government will step in once again with some sort of stop gap payments to keep these schools from collapsing.
Well, I spoke to the chief operating officer of the New York City Department of Education, which is the largest public school system in the United States, and they made clear that they planned to ask for some form of federal assistance to try to blunt the impact of this
cliff that they're facing. They were not clear about who specifically they would ask or how much money they would ask for, but they did make clear that at the rate that the school district is going they have more or less two options, which are get additional money or face some really serious budget cuts in the years ahead.
Truly, as you look ahead in your reporting, what are you watching for in the next year.
Some of the things that parents, government officials, budget officers, and anyone else who watches school districts is going to watch is what the impact is going to be of the pandemic on learning and the lass associated with it. What are school districts going to do to address some
of that? Now, we have these budget concerns that we are talking about that are going to be layered on top of that, And one of the academics that we spoke with said, you need to care about this now, because if you don't care about now, don't be surprised if you have forty children in one classroom in just
a couple of years. So that's one of the reasons that these topics are really starting to be discussed now, because people are starting to think about what is this going to mean a year from now, five years from now in the classroom.
I think something also that's important to keep in mind is that even though it may feel like the pandemic is over, some of the test results indicate that's far from the case. The most recent nationally comprehensive testing data shows that some students actually backslid versus last year, so we're still seeing an impact on student learning. And these are things that have massive implications for students' lives and
their livelihoods going forward. There's some research that shows the pandemic may decrease students' lifetime earnings by upwards of tens of thousands of dollars. And it's these programs, these interventions in long term assistance programs that are are what are going to really make or break students' futures going forward.
Nick Shrudy, thanks so much for coming on the show. Thank you, thanks for listening to us here at The Big Take. It's a daily podcast from Bloomberg and iHeartRadio. For more shows from iHeartRadio, visit the iHeartRadio app, Apple Podcasts, or wherever you listen, and we'd love to hear from you. Email us questions or comments to Big Take at Bloomberg dot net. The supervising producer of The Big Take is Vicky Ergolina. Our senior producer is Katherine Fink. This episode
was produced by Sam Gabauer and Christine Driscoll. Kilde Garcia is our engineer. Our original music was composed by Leo Sidrin. I'm wes Kasova. We'll be back tomorrow with another big take.