Study: Teacher Pay Increase in Arkansas Closed Rural Funding Gaps

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Updated August 22

Fueled by federal pandemic funds and an ultra-tight labor market, teacher pay in the United States has climbed steadily over the last few years. According to the National Education Association’s annual salary rankings, the average American teacher pulled in nearly $72,000 during the 2023–24 school year. 

The startling upward movement — a 3.1 percent increase from the previous year, and 27.1 percent higher than average pay in 2012–13 — reflects the lengths school districts and states are going to keep educators in the profession as post-COVID burnout tempts many to quit. But lawmakers and education leaders alike await evidence that the higher expenditures will yield  real-world benefits. 

A recent study from Arkansas offers reason to think it will. 

Released as a working paper this spring, the research shows that the LEARNS Act, a law passed last year that substantially increased starting teacher salaries, has channeled badly needed dollars to teachers in rural and financially struggling districts. While effects on teacher retention have been slight thus far, researchers believe that higher pay may gradually lead to lower turnover among the state’s K–12 workforce.

The LEARNS Act notably increased funding for rural and high-poverty districts, mitigating the negative association between starting salaries and district poverty rates.

Gema Zamarro, University of Arkansas

Gema Zamarro, an economist at the University of Arkansas and one of the lead authors of the paper, said it was “a positive trend in and of itself” that the legislation helped rebalance the fiscal reality in favor of more disadvantaged schools.

“The LEARNS Act notably increased funding for rural and high-poverty districts, mitigating the negative association between starting salaries and district poverty rates,” Zamarro wrote in an email. Those districts “can now better compete with more urban, richer districts in recruitment of beginning teachers to their districts,” she added.

While still provisional, the findings could prove encouraging to states as they navigate an unpredictable hiring environment. After remaining relatively stable through the first few years of COVID, teacher quit rates began edging upward in 2022. States have adjusted their budgets accordingly: A tracker maintained by the research group FutureEd indicates that legislators in nine states passed bills to boost teacher salaries last year.

Among them was Arkansas, which had earned a reputation for some of the lowest pay and worst academic performance in the country. The LEARNS Act, passed under the direction of newly elected Gov. Sarah Huckabee Sanders, included a massive influx of new spending that bumped the starting salary for new teachers to $50,000 — essentially lifting the compensation floor from 48th in the United States to fourth. Beyond that, the legislation granted all Arkansas instructors a raise of at least $2,000 and eliminated the minimum salary schedule, allowing district leaders more scope to set pay as they think best.

Zamarro and her colleagues at the University of Arkansas gathered data from 230 of the state’s 234 school districts, as well as nine of its 12 charter school operators, to study changes over the 2023–24 school year, when the law first came into effect.

Across the state, lifting each district’s minimum teacher salary up to $50,000 cost an average of $8,486 per teacher. But the increases were naturally larger in districts that had previously paid teachers less. In particular, rural districts lifted salaries by roughly $2,350 more than their urban counterparts. Economically struggling districts also spent more of the new funds per teacher: A 10-point increase in their proportion of poor students (from 5 percent of a given district’s students to 15 percent, for example) was correlated with an average increase in starting teacher salaries of $962. 

In practice, the bigger raises for high-needs areas helped even out historical inequalities in K–12 resources. While average starting pay for teachers before the LEARNS Act was about $2,400 lower in rural districts than in urban ones, that difference was narrowed to just $48 in the year following enactment. 

The state fully funding these salary increases has resulted in this component of the LEARNS Act being a very progressive education finance reform.

Andrew Camp, University of Arkansas

Andrew Camp, one of Zamarro’s co-authors, noted in an email that the $181 million cost of the compensation shakeup was borne entirely by the state, making it a huge transfer of funds to some of the most disadvantaged communities in Arkansas.

“I think this is an aspect of the LEARNS Act that is especially undersold,” Camp wrote. “The state fully funding these salary increases has resulted in this component of the LEARNS Act being a very progressive education finance reform.”

Leveling the playing field

While the legislation effectively leveled the playing field in starting teacher salaries between different kinds of districts, its influence on teachers’ career choices was more muted during its first year of implementation.

Following the passage of the LEARNS Act, the proportion of Arkansas teachers leaving the profession was 3.4 percentage points lower than over the same period in the prior school year, 2022–2023, when national data pointed to a sizable jump in resignations. Compared with the average from 2016 to 2023, the proportion of teachers quitting was 1.4 points lower — still a statistically significant decrease, though smaller.  

The question of teacher retention is especially acute in Arkansas because of the large number of districts that faced challenges in attracting qualified teachers even before the pandemic. Between 2013 and 2016, the number of candidates enrolled in any of the state’s teacher preparation programs fell by nearly half. Stubborn shortages have necessitated the widespread use of waivers to allow instructors to teach subjects and grade levels for which they lack certifications; the fraction of Arkansas teachers receiving such a waiver has crept up to as high as 9 percent in recent years, over double the national average.

But over the last school year, the study finds, new teachers were 2.6 percentage points more likely to take a job in a geographic shortage area than they were in 2022–23. Compared with a longer-running average of the last seven years before the passage of the LEARNS Act, the difference was still positive (1.2 points), though not statistically significant.

Both Zamarro and Camp argued that the reform’s still-modest effects on the local labor force may increase with time. Sanders only signed it last March, after many teachers had already made up their minds about whether they would sign on for the following year. Even through the end of that summer, a legal challenge filed against other provisions in the law raised some doubts over whether the raises would even be paid out. 

“In that sense, I think that the fact that we observe some emerging results already is a promising sign,” Zamarro wrote. “It is possible that we will observe more positive effects in the future as districts and teachers have more time to adapt to the new legislation.”

Yet others wonder if the uniformity of the pay increase may backfire. 

Because of how it was written, most of the rewards from the LEARNS Act are earmarked for early-career teachers making the least money. Given the notably high quit rates for younger educators — one study from the National Center for Education Statistics has found that about 10 percent exit the profession after their first year, and 17 quit within their first five years — that may be sensible.

But lifting the floor without an accompanying move to raise the ceiling will also have the effect of flattening pay differences between novices and veterans. Last year, one-third of the districts in the state adjusted their salary schedules to pay $50,000 for teachers at all experience levels. Some even reduced the maximum level of their salary schedules, saying they needed o know more about the state’s intentions for funding the LEARNS Act before developing their own long-term plans. One unspoken question is whether districts will eventually be asked to shoulder more of the financial burden themselves.

Christopher Candelaria, an education professor at Vanderbilt University, has previously studied the effects of school funding infusions. He said the potential trade-offs of structuring pay increases this way could only be known with more years of study.

Have we just equalized the salary schedule across the board, and across the range of experience — and if so, what implications might that have for teachers who want to stay in the profession?

Christopher Candelaria, Vanderbilt University

“Have we just equalized the salary schedule across the board, and across the range of experience — and if so, what implications might that have for teachers who want to stay in the profession?” he mused. If greater experience, and potentially greater skill, is not met with greater rewards, Candelaria continued , “we might see more teachers exit the profession.”

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