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Highlights from Education at a Glance 2009
branch Paying for Education
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What accounts for variations in spending on salary costs?
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  • Similar levels of expenditure among countries in primary and secondary education can mask a variety of contrasting policy choices. This helps to explain why there is no simple relationship between the overall spending on education and the level of student performance.
  • The higher the level of education analysed, the higher the impact of teachers' salaries and the lower the impact of class size on salary cost per student as a percentage of GDP (compared to the OECD average).
  • Salary cost per student at upper secondary level of education varies significantly between countries, from 3.6% of GDP per capita in the Slovak Republic to 22% in Portugal.

Significance

The relationship between resources devoted to edu-cation and outcomes has been the focus of much interest in recent years, as governments seek to ensure value for money in public spending while satisfying the education needs of society and the economy. Consequently, there is considerable interest in international comparisons of how various school systems allocate resources. This spread examines these questions from the perspective of salary cost per student - a calculation based on the hours students spend in the classroom, teachers' teaching hours, class size and teachers' salaries. Salary cost per student (as a percentage of GDP per capita) is calculated for each country and then compared with the OECD average.

Findings

Comparisons of the different levels of education show that differences between countries at the level of the salary cost per student are largest at the upper secondary level of education, and these differences between countries decrease with the level of education analysed.

At upper secondary level, salary cost per student ranges from USD 574 in the Slovak Republic to about USD 10 065 in Luxembourg. However, to control for differences in wealth levels between countries, the analysis that follows focuses on salary cost per student as a percentage of GDP per capita. Under this heading, salary cost per student for OECD countries is equivalent to an average rate of 11.4% of GDP per capita, but there are big variations between countries, ranging from 3.6% in the Slovak Republic to 22% in Portugal.

Four factors influence these differences - salary level, instruction time for students, the amount of time teachers spend teaching and average class size. As a result, a given level of salary cost per student can result from many different combinations of the four factors. For example, in Korea the salary cost per student is 15.5% while in Greece it is 15.2%, both above the OECD average. However, Korea's high salary cost results mainly from higher teacher salaries, while in Greece it is a reflection of relatively high instruction time for students and lower teaching time for teachers.

Despite such differences, in 15 out of the 28 OECD countries with available data, one factor - teachers' salaries - is the main driver of the deviation of salary cost per student from the OECD average in upper secondary education.

Differences between countries tend to decrease at lower levels of education. This trend is most obvious in countries where the salary cost per student is furthest from the OECD average. For example, Belgium, Korea, Portugal, Spain and Switzerland have the highest levels of salary cost per student at upper secondary level of education, but they are up to 8 percentage points lower at lower secondary level. (For details on primary education, see chart B7.2 in Education at a Glance 2009).

Definitions

Values for variables are derived mainly from Education at a Glance 2008, and refer to the school year 2005/06 and the calendar year 2005 for indicators related to finance. To compensate for missing values, some data have been estimated on the basis of data published in previous editions of Education at a Glance while others have been replaced by the average for all OECD countries. Salary cost per student is calculated based on the salary of teachers, the number of hours of instruction for students, the number of hours of teaching for teachers and a proxy class size.

Going further

For additional material, notes and a full explanation of sourcing and methodologies, see Education at a Glance 2009 (Indicator B7).

Areas covered include:

  • Salary cost per student by levels of education.
  • Salary cost per student expressed in USD.
 
Indicator in PDF Acrobat PDF page

Figures
g3-14. Contribution of various factors to salary cost per student at upper secondary level, 2006
Contribution of various factors to salary cost per student at upper secondary level, 2006
g3-15. Differences in salary cost per student by level of education, 2006
Differences in salary cost per student by level of education, 2006