Michigan Public vs. Private Sector

Helpful Facts About Michigan’s Public Sector

March 15, 2011
Public Sector vs. Private Sector

  • Bringing public-employee benefits in line with private-sector averages would save $5.7 billion in Michigan.
  • Public-sector bargaining privileges are not inalienable rights.
  • Public-sector wages and benefits have increased while the private-sector’s have fallen.

  • Insurance benefits per public-sector employee are $7,149 more per year than in the private sector.
  • Retirement benefits per public-sector employee are $11,725 more per year than in the private sector.
  • Since the beginning of the recession, the number of government jobs fell by 0.8 percent. Private-sector jobs fell 10.8 percent.

  • People that work for the state directly receive wages and benefits that cost $94,686 on average.

Public School Teachers

Salary

  • Nationally, Michigan has the 8th highest average public school teacher salary.
  • From 2003 to 2009, Michigan teaching salaries were the highest in the nation when controlling for state per capita personal income.

  • The average salary for Michigan public school teachers is $62,000. The average salary for private school teachers nationally is $39,700; when including benefits, the disparity is even greater.
  • The average annual across-the-board salary increase from 2003 to 2010 was 1.8 percent.

Health Insurance

  • In 2009, teachers in 300 Michigan districts paid nothing to the costs of their own health insurance premiums.
  • For Michigan public school teachers, their average contribution to the health insurance premium for family plan is 4 percent. The Michigan private-sector average is 21 percent, and the average for federal employees in Michigan is about 25 percent.

  • Michigan public school districts spent an average of 47 percent more for a family plan health insurance premium for teachers than the private-sector average.
  • Michigan spends $1,300 per pupil on school employee health insurance, up 56 percent since 2000, after adjusting for inflation.
  • 80 percent of Michigan school districts use MESSA for at least one employee group. MESSA’s average premium went up 13 percent last year.
  • Most teachers get subsidized post-employment health insurance for life.

Other Benefits

  • Michigan spends $1,500 per pupil on school employee pensions, up 25 percent since 2000, after adjusting for inflation
  • Michigan ranks 6th in the nation for percentage of instructional spending on employee benefits (28 percent).

  • Michigan public school employees get a defined-benefit pension that they can start collecting at age 55 after 10 years on the job or after 30 years at age 46.
  • Most teachers are contractually obligated to work 185 days per year. The average private-sector work year is about 245 days.
  • Teachers are paid based only on their own educational attainment and years on the job — not on their performance in the classroom.
This article provided by the Mackinac Center – For Public Policy, providing timely information about Michigan.
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