State Employee Pay Grows 25 Percent Above Inflation Since 1999

Total Payroll Up $1.5 Billion Despite Fewer Workers

The average state employee compensation package costs approximately $93,039. Inflation-adjusted wages and benefits have increased 25 percent since fiscal 1999. The figures include the value of all benefits from state-paid retirement contributions to dry cleaning allowances.

The largest cost increases came from retirement benefits (which increased from $309 million in fiscal 1999 to $772 million in fiscal 2008) and health insurance (which increased from $273 million in fiscal 1999 to $554 million in fiscal 2008).

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The wages and benefits of Michigan's over 50,000 state employees cost taxpayers $4.7 billion in fiscal 2008. This is up from $3.2 billion in fiscal 1999, despite the state now employing 15 percent fewer workers.

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Having a job — any job — is connected to lower poverty, better income mobility, lower crime rates, fewer children born out-of-wedlock and a host of other positive results. But today the right to earn a living is becoming more difficult. In 1950, only around 5 percent of workers needed an occupational license – today, more than 20 percent of workers in Michigan are required to have this special government permission to work. Licensing requirements typically include mandated educational degrees, hours of training, upfront fees, testing, continuing education and more. But reform may be coming. The Obama and Trump administrations have both focused on licensing rules, working to encourage states to lessen the burden. Research from scholars across the political spectrum are in agreement that these regulations stifle innovation, raise prices, reduce the number of jobs, encourage income inequality and raise incarceration rates. This event will feature three scholars talking about their research on occupational licensing and what lawmakers and citizens should consider when thinking about the issue.

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