How and why has teacher quality changed in Australia?

• Andrew Leigh, Chris Ryan
• Centre for Economic Policy Research

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29 August 2006Abstract: International research suggests that differences in teacher performance can explain a large portion of student achievement. Yet little is known about how the quality of the
Australian teaching profession has changed over time. Using consistent data on the
academic aptitude of new teachers, we compare those who have entered the teaching
profession in Australia over the past two decades. We find that the aptitude of new
teachers has fallen considerably. Between 1983 and 2003, the average percentile rank
of those entering teacher education fell from 74 to 61, while the average rank of new
teachers fell from 70 to 62. One factor that seems to have changed substantially over
this period is average teacher pay. Compared to non-teachers with a degree, average
teacher pay fell substantially over the period 1983-2003. Another factor is pay
dispersion in alternative occupations. During the 1980s and 1990s, non-teacher
earnings at the top of the distribution rose faster than earnings at the middle and
bottom of the distribution. For an individual with the potential to earn a wage at the
90th percentile of the distribution, a non-teaching occupation looked much more
attractive in the 2000s than it did in the 1980s. We believe that both the fall in average
teacher pay, and the rise in pay differentials in non-teaching occupations are
responsible for the decline in the academic aptitude of new teachers over the past two
decades.