Teachers’ Unions Nightmare: Study Shows Charter Schools More Cost-Effective Than District Schools

A new study out of the University of Arkansas shows that charter schools are far more cost-effective and produce nearly 50% more investment than district schools.

Teachers’ unions have shown their hostility to charter schools. The Center for the American Experiment noted in 2019, “The National Education Association (NEA) updated its policy on charter schools by adopting a ‘new’ policy on charter schools in 2017. The policy is an aggressive statement against charter schools, a fast-growing competitor for student enrollment.”

The NEA stated, “The new NEA Policy Statement on Charter Schools will boost NEA’s forceful support of state and local efforts to limit charter growth and increase charter accountability, and slow the diversion of resources from neighborhood public schools to charters.”

The University of Arkansas study notes that public education spending in the United States has been rising for some time, that in 2017-2018, $780 billion was spent on the public education system. Meanwhile, the number of public charter schools has grown like wildfire as between 1991 to 2019, charter school legislation passed in 45 states and the District of Columbia while enrollment has reached 3.3 million.

Examining traditional public schools (TPS) in Camden, Denver, Indianapolis, Shelby County (Memphis), New Orleans, San Antonio, and the District of Columbia, the study compared funding for public charter schools and TPS as well as “what levels of student achievement are attained across the two public school sectors, and how much economic payoff our society can expect to receive as a result of the educational investments in each sector.”

The study said of its method:

We calculate the cost-effectiveness of the charter and TPS sectors in each city by taking the average National Assessment of Educational Progress (NAEP) scores each city achieved and distinguishing the charter school average from the TPS average using recent rigorous evaluations of charter schooling effects by Stanford University’s Center for Research on Educational Outcomes (CREDO). We then divide those scores by the city’s per-pupil revenue amount received by students in its charter and TPS school sectors.

The study continued:

In all seven cities, public charter schools outperform TPS in both math and reading cost- effectiveness. The public charter school sector delivers a cross-city average of an additional 5.92 NAEP points per $1,000 funded in reading, representing a productivity advantage of 43 percent for charters, while the student-weighted public charter school advantage of 5.11 points per $1,000 represents a cost-effectiveness benefit of 35 percent.

The public charter school sector delivers a cross-city average of an additional 6.26 NAEP points per $1,000 funded in math, representing a productivity advantage of 43 percent for charters, while the student-weighted public charter school advantage of 5.37 points per $1,000 represents a cost- effectiveness benefit of 35 percent.

The cost-effectiveness advantage for charters compared to TPS regarding NAEP reading scores ranges across the cities from 6 percent (Memphis) to 92 percent (Camden); and the cost-effectiveness for charters compared to TPS in terms of NAEP math scores ranges from 4 percent (Memphis) to 88 percent (Camden).

Speaking of return-on-investment (ROI) the study states:

In all seven cities, public charter schools produce a higher return on investment than TPS; On average, each dollar invested in a child’s K-12 schooling in TPS yields $5.46 in lifetime earnings compared to $8.00 in lifetime earnings from each dollar invested in a child in public charter schools, demonstrating a 46 percent public charter school advantage in ROI is $2.85 or 57 percent.

On average, public charter schools in our sample would produce $487,177 more in lifetime earnings than the TPS in our sample, if the observed productivity levels remained constant and each sector received the amount of revenues per student currently received by charters; Spending only half of the K-12 educational experience in public charter schools results in $6.48 in benefits for each invested dollar, a 19 percent advantage relative to a full-time (13 year) K-12 experience in TPS or 22 percent if unweighted.

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