Here’s How Much Teacher Pay Raises Are Really Worth

Steve Wilson /

As Mississippi students head back to school, their teachers are taking home a healthy pay raise. And those extra Benjamins are going a lot further.

The pay raise, passed by the state legislature in last year’s session, gives a starting teacher with a bachelor’s degree a yearly salary of $33,390. That’s up $2,490 from last year, an increase of more than 8 percent.

According to research from the Tax Foundation, that raise is worth even more than many realize.

The nonpartisan tax research group did research on regional prices reflected in the true value of $100 among the states. It found that $100 in the Mississippi is worth $115.74, the highest rate in the country. The worst was California, where the real value of $100 is $88.57.

>>> This Is How Far $100 Gets You In Your State

Tax Foundation economist Lyman Stone has researched on real, adjusted incomes and migration patterns among the states. Using data from the U.S. Department of Commerce’s Bureau of Economic Analysis, he found that migrants moving from one state to another are drawn to  higher real incomes. Stone said of regional price increases:

I think it’s something that people come to intuitively. But we were able to put a name to what people are feeling. Cost of living has a role to play in migration, and it’s quite a significant one.

When comparing Mississippi — the state with one of the lowest costs — to California — the one with the highest — the differences are major.

Factor in the cost of living in Mississippi, where $100 gets 15.74 percent added in purchasing power, and the state’s teachers receive an extra $5,255. That adds up to an adjusted $38,645.

In California, according to the last statistics available (2012-2013), the average low point of teacher salaries (pay differs from district to district) is $40,329. That amount rises to $61,725 with a bachelor’s degree plus 60 additional semester units.

Since California’s purchasing power of $88.57 per $100 is a 11.43 decrease, adjusted pay for a starting teacher there falls to $35,719.

Stone said:

That person in Mississippi is getting a much higher standard of living, but paying the same federal tax burden. There are real benefits to being in a low-price state because it means you kind of get a discount on your federal taxes, so to speak.

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