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Inflation Will Put Districts in a Pickle

BY debraabritt
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Marguerite Roza
Published April 20, 2022 by Education Next

Marguerite Roza writes:

Talking with school district leaders in early March, I asked how they were thinking about today’s record-high inflation and its impacts on their systems’ finances. Turns out, most weren’t thinking about it at all.

On the one hand, that inattention was fair. At 90 percent of the budget, districts’ biggest expense is labor, which is frozen in place for the duration of the labor agreement. Any immediate inflationary impacts, like those of rising fuel costs, were impacting only a tiny portion of the budget (transportation costs amount to well under 5 percent of a district’s expenses). Some leaders noted that prices were rising for utilities, food service, and construction projects, but those things typically make up only a small slice of the pie.

Besides, districts are flush with federal relief funds right now.

Then I asked about upcoming labor negotiations and what they expected the ask would be from teachers and staff, given the skyrocketing inflation rate. That’s when I got their attention…

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