Interesting phenomenon, actually. I wonder if market pricing for teachers would result in higher pay or more teachers: I.e. if lowering pay were easy, or if firing were easy.
Certainly some aspect of compensation must pay for the hiring risk.
And the other thing is that government organizations are slow to react to market forces, so as the majority employer in the space, they're frequently likely to just be behind. Some sort of incentive mechanism for cost cutting may work but it's hard to build that without it misfiring.
If I were in charge of an education system, I'd definitely hard bargain to keep teacher costs low because in downturns it's the cost I have least control over managing. There'd be a delta in the fair market price as a result.
In addition, my boss would likely also try to keep my budget low since if any extra would go into the piece that has most market power - unionized labour.
https://www.washingtonpost.com/education/2023/05/12/free-tra...