Michigan Spends More on Teacher Benefits Than Most Other States

Of all the funds spent on “instruction” in Michigan public schools in 2008, 28 percent went to employee fringe benefits. Only five states devoted more of their resources to benefits; the national average was 22 percent.

The data comes from the National Center for Education Statistics, which breaks down the percentage of instructional costs that went to salaries, benefits, purchased services and supplies. Michigan spent only 61.5 percent on salaries, the third lowest after New Jersey and Alaska. Texas, North Carolina and Indiana led the nation by devoting about 75 percent of instructional costs to salaries.

Holding down the proportion spent on fringe benefits helps schools budget by making it easier to contain costs when funding is tight, because compared to benefits schools have more direct control over how much they’ll allow salaries to grow.

In fact, Michigan school districts have virtually no control over how much they pay for employee retirement benefits. These are mandated by the Legislature. In addition, most districts have voluntarily given up control over their health insurance costs to the MEA school employee union: Its subsidiary, the Michigan Education Special Services Association, is the company used by 440 of 551 school districts, and it requires districts to forfeit their right to be the policyholder of their own plans. Instead, MESSA holds and administers the policies, giving it control over year-to-year costs.

Locking in high labor costs by devoting such large amounts to employee fringe benefits is taking a toll on Michigan schools — and on taxpayers. The percentage of payroll that school districts must contribute to employee pensions has almost doubled over the last decade. When adjusted for inflation, the amount that schools spent per pupil on employee health insurance has increased by 56 percent over the same period.


See also:

The Salary History of a West Bloomfield Public School Teacher

The Salary History of a Michigan Public School Teacher

Paid to Leave: Generous Teacher Buyouts at East Lansing Public Schools

Michigan Teacher Pay 16.5 Percent Higher Than Indiana

Don't Tenure Current Teacher Tenure Law

Budget Savings Drained and Raises Continue at Alpena Schools

Paying Teachers Not to Teach

Warren Schools: Plenty of Desks, But Not Enough Cost-Cutting?

Warren Board Member: "MEA Will Eat Their Young"

Union Leader's Claim of School Kids Sitting on Floors Draws More Denials

What is the Future for Michigan's Public Employee Unions?

Michigan Public Employee Pay and Benefits Growing

Government Pay Outpaces Private Sector

MEA Has $174.5 Million in Liabilities, $66.3 Million in Dues

Nearly One Thousand Six-Figure Salaries at UAW and National Education Association

Employee Health Insurance Premium Co-Pays Still Rare at Public Schools

Michigan Public School Health Insurance Costs Soar Above National Trends

Public Employees Pay Least Toward Their Health Insurance

Districts Save With Health Savings Accounts

Snyder Talks Up 'Fixing Michigan' in Chelsea

Moss Message: Champagne Bubbles

Michigan Public Employees Compensation Growing Despite Concessions Claims

Why a Democrat Voted Against a State Employee Pay Hike

The People and the Political Class

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.