Analysis: Educators’ salaries, bonuses, benefits eat up most of COVID-19 money

(The Center Square) – More than half of the money from federal COVID-19 aid went to salaries, benefits and bonuses for educators with implications for the future, new analysis of how North Carolina schools shows.

FutureEd analysis released this week examined the third round of federal Elementary and Secondary School Emergency Relief, which represents about $3.6 billion of a total of $5.6 billion in school aid received during the pandemic. The director of the North Carolina office of learning recovery says that could mean some tough staffing choices are in the near future.

The funding from the American Rescue Plan Act is intended to help schools address learning loss from government-imposed closures during the pandemic that kept students from the classroom for months. The analysis comes amid predictions the end of the federal funds could portend teacher layoffs in many districts.

Through Oct. 31, North Carolina schools spent or encumbered roughly $2.3 billion of the $3.6 billion in third round funding, with about $1.2 billion going to compensation, according to the report.

A breakdown shows about 25% went to bonuses or other extra pay, while roughly the same percentage was dedicated to salaries and benefits for school employees. About 55% of the state’s school systems overall spent at least some of the funding on staff bonuses, though the figure was 88% for traditional public schools and 30% for charter schools.

In total, staffing bonuses accounted for $445 million, or 20% of the third round funding spent so far, with individual amounts to educators varying widely by district. In Charlotte-Mecklenburg County Schools, the state’s second-largest district, more than $76.2 million went mostly to recruitment and retention incentives, which included $2,500 critical recruitment bonuses and $200 monthly retention incentives for high demand positions from special education teachers to bus drivers, according to the report.

Other examples include $20,000 signing bonuses in Guilford County Schools and $4,000 bonuses at Union County Public Schools for similar incentives.

The FutureEd analysis found 63% of rural districts spent on bonuses compared to 42% of urban districts.

“We don’t truly know the impact,” Rachel Wright-Junio, director of the North Carolina office of learning recovery, told researchers. “At least from an anecdotal standpoint, I do think that if they did not give bonuses to teachers working in the summer programs and things, there would be further staffing issues. But my fear is that once these go away, once there are no more bonuses or options to award bonuses, teacher shortages, bus driver shortages may be exacerbated.”

Another $369.3 million in third round funding went to staff salaries, including roughly a third going to classroom teachers. An additional $50.2 million went to salary supplements, or extra payments to effective educators, according to the report.

FutureEd notes that while it’s unclear how much of that spending went to new hires, the number of teachers supported by the federal funds jumped by 23% between 2018-19 and 2022-23, or about 1,300 teachers, while the total number of teachers declined by 720.

“You don’t know the counterfactual, which might be that the district would have hired for that new position anyway and used other spending for it,” Dan Goldhaber, director of the Center for Analysis of Longitudinal Data in Education Research at the American Institutes for Research and a FutureEd research advisor, said in the report. “I think it probably indicates that some of those teachers are, in fact, going to go when ESSER disappears. But you don’t know that for sure.”

Other spending outlined in the report includes $237 million for “other” expenses, such as gas, food, furniture, field trips and security; $213 million for HVAC work; $204 million for computers; $168 million for construction and maintenance; $166 million for contracted staff; and $132 million for supplies.

About half of the state’s school districts and charters spent a total of $44.1 million on tutors, according to the report.

While the focus on one-time bonuses will help ease the pain when the spending deadline comes on Jan. 28, FutureEd notes “local education agencies are going to face hard staffing choices” in 2024.

“If a district is going to use [federal] Title I, Part A funds [they receive every year] to continue with high-dosage tutoring, for example, then they are going to have to figure out what they’re going to get rid of that they were previously funding,” Wright-Junio said in the report.