Andrew Cline: NH surged to 4th in public school spending growth while posting nation's largest enrollment decline

As New Hampshire’s K-12 public schools experienced the largest enrollment decline of any state this century, they enjoyed the fourth-highest increase in spending nationwide, according to a new analysis from the Reason Foundation’s K-12 Education Spending Spotlight.

K-12 public education spending in New Hampshire grew by 60.5% from 2002 to 2023, the fourth-highest growth rate in the nation, Reason’s review of federally reported education data shows.

Only New York (75.8%), California (78.6%) and Illinois (62.5%) saw their public education expenditures rise at a faster rate, according to the analysis.

Yet over that same period, New Hampshire’s K-12 schools experienced the nation’s largest decline in enrollment, with the total number of students falling by 18.4%.

Large increases in employee benefits costs was a significant factor in the overall spending growth.

“Inflation-adjusted K-12 education spending on employee benefits — which includes teacher pensions, health insurance, and other expenses — increased by 81.1% between 2002 and 2023, rising from $2,221 per student to $4,022 per student," Reason Foundation’s analysis shows.

“In comparison, real spending on employee salaries grew modestly, rising from $8,449 per student to $9,098 per student, a 7.7% increase. As a result, for every new $1 that public schools spent on employee salaries between 2002 and 2023, benefit expenditures rose by $3.27.”

New Hampshire’s spending on public school employee benefits grew by 151.6% from 2002 to 2023, ranking seventh in the country.

Adding new non-teaching staff positions also drove spending increases, the research shows.

“Between 2002 and 2023, the number of public school staff increased by 15.1%, while student enrollment grew by only 4.1%. The bulk of new K-12 hires were non-teachers, which increased by 22.8%, such as counselors, social workers, speech pathologists, and instructional aides.

“In comparison, the number of teachers rose by 7.6% during this time. Nationwide, non-teaching staff now account for over half, 52.5%, of all public school employees, up from 49.2% in 2002.”

New Hampshire’s non-teaching staff grew by 13.8% from 2002 to 2023, ranking 35th in the country.

The Reason Foundation study is consistent with other research, including from the Josiah Bartlett Center, showing large K-12 public school spending increases in the last several decades as enrollment has fallen.

The Bartlett Center’s most recent study, published in June, showed a 45% increase in inflation-adjusted spending on New Hampshire district public schools from 2001 to 2024, as enrollment fell by 26%.

Total per-pupil spending in New Hampshire’s district public schools rose by an inflation-adjusted 96% from 2001 to 2024, meaning that the average district public school student had 96% more in real resources devoted to his or her education in 2024 than in 2001.

In 2001, district public schools in New Hampshire spent only $8,265 per student, but when adjusted for inflation that figure translates to $13,470 per student in today’s dollars. Average per-pupil spending in 2024 came to $26,347, representing an increase of 96%, the Bartlett Center’s June report showed.

Most of New Hampshire’s K-12 spending growth comes at the local level, where voters typically approve large annual school budget increases even as enrollment falls. But New Hampshire’s state spending and enrollment numbers from this fall reflect recent increases in state contributions too.

“Per-pupil state adequacy funding is projected to reach its highest level ever,” the state reported this month. The state average grant per pupil is roughly $7,100.

The inescapable conclusion is that New Hampshire’s K-12 public school students have more resources devoted to their educations than ever before. Unfortunately, this increase in resources has not led to performance gains.

As total spending rose by 45% and staffing increased significantly from 2001 to 2024, New Hampshire’s National Assessment of Educational Progress (NAEP) reading and math scores fell by a total of 21 points. Nationally, scores fell by 7 points, which means that New Hampshire fell behind relative to other states despite posting one of the nation’s largest increases in spending.

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Andrew Cline is president of the Josiah Bartlett Center for Public Policy, New Hampshire’s free-market think tank. The center’s mission is to develop and advance free-market policies that promote opportunity and prosperity for all Granite Staters.