ESSER Funding and School System Jobs: Evidence from Job Posting Data. Working Paper No. 297-0424

The Elementary and Secondary School Emergency Relief Fund (ESSER) was the largest onetime federal investment in K-12 schools in history, funneling almost $200 billion to states and school districts. We use novel data from Washington State to investigate the extent to which ESSER funding causally influenced spending on school personnel. We argue one cannot infer this directly from ESSER claims data because of the fungibility of school budgets. Thus, we rely on a more direct signal of district hiring decisions: public education job postings scraped from district hiring websites. To address endogeneity concerns, our preferred approach employs an instrumental variables strategy that exploits a formula mechanism used to determine Title I funding for 2020-21 (and thus ESSER allocations in 2022) based on the number of Title I formula-eligible children. We find strong, arguably causal, evidence that public school hiring increased in response to the availability of ESSER funding. Specifically, we estimate that each $1,000 in ESSER allocations caused districts to seek to hire $206 in additional staff, disproportionately teachers. These estimates suggest that roughly 12,000 new staff (including 5,100 teachers) were hired in Washington because of ESSER. In the absence of new funding, school staffing budgets will likely need to contract substantially following the sunset of ESSER.