Q&A of the Day – Where Florida’s teacher pay ranks & the impact of no state income tax
Each day I’ll feature a listener question that’s been submitted by one of these methods.
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Today’s entry: Do teachers take into account that other states they compare their pay to, may have not only income tax, but higher other related taxes? Florida is a low tax state. Makes perfect sense that government pay is a few percentage points less.
Bottom Line: Governor DeSantis declared 2020 the “Year of the Teacher” in Florida. It’s safe to say that the conversation surrounding teacher pay plans supports the governor’s narrative. I’d approximate that about half of all notes, feedback, questions, etc. - over the past two weeks have been about Florida teacher pay. The interest and level of engagement is encouraging, because as we’ve discussed, Florida’s likely to pass the most extensive increases in compensation for teachers in our state history. All Floridians will be impacted whether we have children in schools or not. As we’ve discussed, if increases were passed at the level proposed by Governor DeSantis, the average household would have to account for about $95 more annually. That takes me to the crux of your question. How does Florida’s teacher pay compare to other states and how does the lack of an income tax factor into net take home pay for teachers? They’re great questions.
First, for the current school year the average nationwide gross compensation for all teachers is about $60,500. Florida is below the national average at approximately $54,750 – ranking 27th currently. This already sounds different than many of the arguments you hear advanced by the FEA. You’ll commonly hear that Florida ranks either 46th or 47th in teacher compensation. That’s deceptive. If you were to only look at base salary, Florida would rank 46th this year in teacher pay. That doesn’t account for the compensation earned by teachers through the state’s robust Best and Brightest bonus pool. For the 2019-2020 school year $285 million in bonuses will be paid out to teachers across the state. Once that’s factored in, Florida jumps from 46th in teacher pay to 27th. That’s before we factor in the lack of income taxes in Florida.
We are one of seven states without a personal income tax. The others are Alaska, Nevada, South Dakota, Texas and Washington. The average state income tax rate is about 3% currently. Based on the current total compensation of Florida’s teachers, equates to about $1650 additional dollars earned compared to the 43 states that impose personal income tax. Factoring in state taxes – Florida's net teacher compensation, adjusted for currently salaries, bonuses, benefits and taxes – takes Florida up to around 23rd in average teacher pay currently. So yes, in the context of this conversation Florida’s lack of income tax certainly does make a significant difference. To your point, it has the current impact of taking Florida’s total teacher compensation from slightly below average nationally, to slightly above average. As Governor DeSantis has indicated, his proposal would take Florida’s starting teacher compensation to 2nd highest nationally and would likely place Florida’s total teacher pay into top ten overall – not factoring in Florida’s tax advantages.