Recruitment & Retention

Schools Warned to Expect Wage Pressures for the Foreseeable Future

By Mark Lieberman — June 15, 2022 1 min read
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School districts should plan to keep raising wages to stay competitive in the persistently volatile labor market, even as pressures on spending pile up, a bulletin from a prominent credit rating agency warned Wednesday.

The K-12 sector overall has a healthy credit rating, but some districts are in a stronger position than others, the report from Fitch Ratings says. Districts with low credit ratings may find it difficult to meaningfully expand compensation for staff without further denting their credit status.

Chief financial officers and other business administrators in districts keep a close eye on credit agencies, whose ratings influence their capacity to generate bond revenue, place bids for strong contractors, and advocate for increased state aid.

The Fitch credit agency’s take is the latest signal to school districts that the acute staffing challenges that defined the last school year are not likely to resolve themselves quickly. Districts nationwide are struggling to find enough support staff like bus drivers, paraprofessionals, cafeteria workers, and nurses, as well as teachers in some cases.

In recent months, paraprofessionals in Denver and Nashville; school social workers and therapists in New Mexico; school nurses in Fort Worth, Texas, and school bus drivers in Louisiana, Florida, and New York have publicly rallied or refused to work to advocate for pay increases. Teachers’ strikes agitating for better pay have jolted districts this year in Brookline, Mass., Minneapolis, Oakland, Calif., Proviso, Ill., and Sacramento, Calif..

Raising wages is the most obvious tactic to entice workers. But, as the Fitch item and Education Week’s reporting highlight, private employers often have far more capacity than school districts and other public employers to offer robust hourly wages. Many school districts are seeing workers retire or quit for jobs with companies like Amazon and Uber or local employers with more competitive rates.

Working conditions in schools also play a role in these challenges. Many school employees say they feel overworked and underappreciated, burdened with high expectations from parents and political controversies that distract from the educational mission. For more on these issues and potential solutions, check out Education Week’s new special report, “Why Staffing Schools is Harder Than Ever.”

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