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Even if you're not a teacher or planning to be one, it's not likely you missed the big national debate about teacher compensation over the years.
Public opinion on education spending is complicated. And no wonder! The details behind district spending can be shaped by murky factors like state laws and federal rules around grant mandates. And with teacher compensation being a big part of the cost, it always seems to get tangled up in the bigger conversation about how tax dollars are spent on education.
According to the Department of Education, teacher compensation includes salary, extra pay, benefits and pension. Put them all together and they are the single biggest expense for any school district. The national tally comes to about $304 billion a year according to the Census Bureau, and as a teacher, a little slice of that massive pie belongs to you.
Figuring out base salaries for teachers isn't too complicated. They are paid on a set salary schedule that's largely determined by tenure and education level. And with a specific number of hours outlined in union contracts, even when teachers do put in those extra hours, there isn't a lot of wiggle room for additional pay.
If you're planning to become a teacher, you probably already have a handle on what your salary is going to be like. But it's the value of your benefits that can be harder to pin down.
We're going to unravel that mystery for you right here, though, and show you exactly how much all those wonderful teacher benefits add to your bottom line.
You hear it all the time: the real value in being a teacher is in the benefits. And it's true. The old iceberg analogy applies here since a big chunk of your compensation is hidden below the surface.
The Bureau of Economic Analysis estimates that the benefits portion of teacher compensation is equal to 45 percent of their annual wages. For a teacher making $61,820, that works out to almost $29,000 a year. Compare that to the 19 percent you might get working for just about any other employer that offers benefits.
Let's not kid ourselves, though. A lot of the benefits you enjoy are things you can't put a dollar value on. You love your summers off… good luck finding another career that offers that benefit! If the smiles on your students' faces blast into your soul like sunshine, that's a big deal too. Those aren't the kind of benefits you can plug into a spreadsheet, though.
Still, there are plenty of material benefits courtesy of your contract that can be penciled into a ledger. You won't always see them accounted for on your pay stub or in the public debates about teacher salaries, but they are all in there.
But just what exactly is the dollar value of those benefits, anyway? Where do they come from?
Dust off your calculators and come along with us to find out!
If you are currently teaching, you are probably looking at your most recent pay slip right now thinking "Wait, my base salary isn't $ 61,820 ." Well, no. That's the national average for public school teachers at all grade levels according to the 2021 US Bureau of Labor Statistics salary and employment figures.
Obviously, teachers are going to see some variation depending on where they are located and what grade levels and content areas they teach.
If you want to drill down a little further, these are the median levels by category for 2021 according to the Bureau of Labor Statistics:
Yeah, we threw in principals and a few others… they're kind of honorary teachers still.
But for our purposes, we're going to go with the 2021 BLS average so we have one number to focus on. All you other folks hang tight, we'll give you the adjusted totals for your job at the end.
Skyrocketing American Healthcare Costs Can Really Boost the Value of Your Insurance - $10,598/yr
Healthcare spending is going through the roof in the United States, and that makes healthcare benefits a big part of teacher compensation. According to the American Medical Association, health spending in the U.S. jumped by 4.6 percent between 2019 and 2020, and has been increasing over 4 percent per year since at least 2014. That's faster than the overall rate of inflation. Medical expenses can eat up a big chunk of savings… unless you have good healthcare coverage.
Almost all teachers get great coverage, though, and more of it than most folks. More than half of teachers have access to dental care and about a third receive vision coverage, well above what most jobs offer. And 97 percent have prescription drug coverage, a boon in times where the Centers for Medicare and Medicaid Services are projecting that drug costs will increase 60 percent by 2027.
Of course, you pay some of those insurance premiums yourself. But according to BLS, teachers on average pay only 16 percent of health insurance premiums versus the 21 percent that most workers are on the hook for.
The value of the employer contribution will vary according to your contract and probably depending on the size of your family. But that $10,598 is the average for American teachers, so we'll start with that.
Of course, the other thing about insurance is that it doesn't have a fixed pay-out. A teacher in good health may never use enough healthcare services to break even on what they put in; while others will have millions paid out in coverage if someone in their family is faced with some serious condition or injury. That's just how insurance works. Be glad if you're the former.
Another way of looking at it is the so-called actuarial value. That's the average likely payout based on the percentage of your total healthcare costs that your insurance covers so you don't have to. Although out-of-pocket expenses for healthcare may be rising, if the percentage covered by your plan remains constant, you're still coming out ahead. Your benefits provider or union should be able to give you the actuarial value of your plan.
Health insurance isn't the only kind of insurance that teachers get, however. District contracts might also offer life insurance coverage. Some pension plans come with basic or optional term life coverage that is wrapped in with your retirement benefits. Although life insurance obviously doesn't have any dollar value to you personally, the peace of mind it brings knowing your dependents will be cared for after you are gone is definitely a benefit.
There are also worker's compensation and unemployment insurance benefits, but those are included in a different category for legally required benefits discussed below.
