New Jersey is a wealthy state that spends a lot on K-12 education, and if you look at raw standardized test scores, its schools are among the nation’s highest-performing.
But not when it comes to poor kids: For that population of students, Mississippi — the poorest state in the nation — is getting better results in the early grades. And it spends less than half as much as New Jersey.
Mississippi’s low-income fourth-graders are among the nation’s best in reading and rank second in math. The gains do narrow as students get older, experts note.
Still, Mississippi is trouncing New Jersey on early scores for the neediest kids. How can that be? It’s the subject of debate over which matters more for student success: money or methodology.
NJ Spotlight News spoke with Kirabo Jackson, a labor economist and professor at Northwestern University who focuses on education finance, to get his take. This NJ Spotlight News interview has been lightly edited.
Julie O’Connor: How much more is New Jersey spending than Mississippi?
Kirabo Jackson: New Jersey is spending more than twice as much: about $25,000 per pupil, while in Mississippi, it’s closer to $11,000. Why might that be?
Credit: Kirabo JacksonEducation is very much about human beings. It’s labor intensive. Seventy years ago, teaching was just a teacher in front of a classroom with a bunch of kids. We have a few more gadgets in the room now, but it’s pretty much the same. Most of the money goes to pay for labor.
The median salary for someone with a bachelors’ degree in Mississippi is about $50,000-$60,000 compared to about $80,000-$90,000 in New Jersey. That’s one key thing. That could potentially explain roughly one-third of the cost difference between these two states.
JO: What about the rest of the spending difference?
KJ: I can’t explain all of it. But special education is another driver of cost. New Jersey has one of the highest special-education rates in the nation. It’s hard to get an exact number for how much it costs to educate kids who have special needs, but it can be very, very expensive. New Jersey classifies more kids as being eligible for special services. it could be a higher prevalence of special needs in New Jersey, or there’s just a higher identification rate. I don’t know.
Salaries, special ed
JO: So how is Mississippi doing better with poor kids for less than half the money?
KJ: It’s an interesting question. Things like teacher salaries and special-education identification can explain about half the spending difference, but the other half still exists.
Teacher pensions can be quite different and absorb a lot of money. It could also be that some places spend a lot more on wraparound services, guidance counselors, things that matter for long-term outcomes that may not matter that much for something like test scores in third or fourth grade.
Mississippi has made tremendous gains in the past few years, particularly in reading. They made a switch toward what researchers have been saying is a much better approach focusing on fundamentals and phonics. That seems to have moved the needle quite a bit.
But I would caution readers from looking at that and saying: Well, we can just slash New Jersey’s budget by 50% and outcomes are going to be the same. By and large, the money being spent is having an effect on kids – it just may be the case that New Jersey is not spending it as effectively as they are in Mississippi.
JO: Could we be getting more for our money?
KJ: We should always strive to get more for money. But I wouldn’t necessarily look to Mississippi and say: Well, just because they were able to do it, it means that we can do it. You are comparing a much more urban state to a more rural state, and there are going to be differences in the needs of the student populations.
Money definitely matters, but how you spend it absolutely matters. What states need to be doing – and not just states, but individual districts – is thinking: OK, what are the specific needs of the students in my community? How can I direct the money toward the needs in a way that’s high-leverage, high-value?
In the case of Mississippi, they looked at their literacy scores and identified that maybe the way they were providing instruction was not optimal and made a change. And that seems to have improved things. We should always be saying: Well, are we spending money on practices that are perhaps not as effective as they could be? Let’s change those practices.
JO: New Jersey is one of the last states to reform how reading is taught based on the latest science, experts say, and doesn’t penalize districts that don’t use high-caliber programs. Might that affect our investment?
KJ: If you were to change the curriculum towards better ones, for sure, that would improve outcomes. No question. Sometimes it could be a matter of incentives. It could also be a matter of leadership. Districts may sometimes be confused; they don’t know what choices will improve outcomes the most.
JO: Some critics argue that we are wasting a lot of money. They point to other states like Mississippi that spend less educating poor kids and have better results. What’s your reaction?
KJ: It would be analogous to saying: Oh, I spent so much money on my health care and I’m sick. I have diabetes. Look at this person over here: They didn’t spend any money at all, and they’re super-healthy, and have no health problems. Therefore, I’m wasting my money.
No one would say that. The fact that some other place was able to have better outcomes without spending as much does not mean the money was not well spent.
When I hear that argument, I usually try to redirect people to thinking not about pointing fingers and blaming, but identifying actual practices that are going to improve student outcomes. I’m not saying that money isn’t being wasted in New Jersey – just that the mere fact that someplace else is having better outcomes for less money is not evidence of that.
JO: You say there will be differences in the needs of students in an urban state like New Jersey versus a much more rural state like Mississippi, even among poor kids. Like what?
KJ: You may have more students who are English language learners in one setting versus another, which poses a different set of challenges. There are also aspects like chronic absenteeism, which has become an issue, especially after the pandemic. We saw rises everywhere, but the solutions are going to be different in a remote, rural environment than a more dense, urban environment.
JO: I’ve heard folks argue that long term, maybe New Jersey students have better outcomes. What does the research say about more money spent on schools?
KJ: There’s no way for me to know what effect an increase in spending in 2025 or 2026 is going to have on earnings because these kids are still in school. But if you look at spending increases in the 1970s, ’80s and ’90s, the evidence is pretty clear: Kids who are exposed to higher levels of per-pupil spending when they were young earn more as adults.
Every additional dollar spent per kid generates maybe $1.50 in increased earnings later in life.
From the long-term, macroeconomic perspective, the juice is worth the squeeze, because you’re getting that money back into the economy. But of course, you don’t see that until 30 or 40 years later, so it’s hard for policymakers to think of it from that perspective.
I want to tie this back to New Jersey versus Mississippi, and the analogy of spending on health. Let’s say I know that if I spent $1,000 more on a particular health intervention, it’s going to increase my life by two or three years. No one is going to look at that and say: Well, I’m not going to spend that, because this other person is healthier than me and they don’t spend any money.
The proposition you’re typically asking yourself is: Given where I am, is it worth spending the money to improve my life – or in the case of education, is it worth spending the money to improve the educational and life outcomes of kids?
And the answer based on the research is yes. It’s also true that we could do better at making sure that the dollars we spend already are going to the most efficient practices and policies possible. Policymakers should be asking: How can we improve policy? And is it worth spending the money?
And I think the answer to both those things is yes.
