by Dr. Robert Luebke
Director of the Center for Effective Education, John Locke Foundation
The new state budget provides an increase of 1.3 percent for each step of the salary schedule. In addition to several bonuses the budget also gives teachers an average 5 percent pay raise over two years. Those numbers have generated the usual complaints from teachers feeling disrespected and wanting higher pay.
Teacher organizations like the North Carolina Association of Educators and other groups are “disappointed” in the pay plan.
I’ve have written much about how we need a more comprehensive view of teacher pay that focuses on teacher compensation (see here and here ). Employee benefits (retirement, health insurance and social security) constitute the other half of the discussion on teacher pay. As usual, that subject is conspicuously absent from the discussion over pay.
It should be noted that the cost of benefits has been outpacing teacher salaries for some time. Since 2011, employee benefits as a percentage of average salary has increased from 28.7 percent to 40.9 percent. Over the same period, the dollar value of benefits — retirement, health and social security benefits – has increased from $13,376 (2011) to $22,279 in 2021.
The new budget continues this pattern and raises the amount the state must pay for health insurance for each employee from $6,326 (2021) to $7,019., an increase of almost 11 percent over last year.
in addition, the percentage of salary the state pays for each employee’s retirement has also increased, from 21.8 percent to 22.89 percent. This current budget is one of the largest increases in recent years.
In 2021, North Carolina spent $14.4 billion on the public schools; of that amount, $3.4 billion was for employee benefits. That’s a lot of money with some concerning trend lines.
Want more money for teacher salaries? Learn to rein in the rising cost of employee benefits.
(Average % payment per employee)
(State Cost Per Employee for Hospitalization Insurance)
Source: North Carolina Department of Public Instruction and North Carolina General Assembly.