Illinois is broke. There is a great debate beginning in the state about public pensions. Teachers pensions are a part of that debate. An aside, another travesty in Illinois is public school administrators.
They make an average of $106,217 in salary, not including pensions and health benefits. In the final three years of their contracts, school districts jack up the administrator salaries to increase their pension benefits for life. Of course, there is hardly a check or balance on the behavior. The taxpayer gets stung.
Teachers also have a pretty good deal in Illinois. They are 100% unionized. The rent seeking teachers' union curries favor with the Democrats. Democrats at every level of government do whatever the union wants.
The average teacher in the state of Illinois makes $61,402. Illinois teachers work around 176 days, 300 minutes, or 5 hours, per day. That's just over 35 weeks per year. On average, they make $348.88 per day, $1.16 per minute, or $69.60 per hour guaranteed. Teachers in Illinois work an average of 12 years. They can retire at age 55.
In order to find out what they really make though, you should take their pension benefits, net present value them and amortize them over their career. As of 2010, the average pension for an Illinois teacher is $43,164. It compounds annually for life at 3% per year.
Now it's time to do some math and make some assumptions. Assume that the lifespan of the teacher is no different than the average American, 78 years. If they start teaching at age 22, on average they will quit at 34. This means they will wait 21 years to collect their pension. The discount rate for the cash flows is a conservative 5%.
When you crunch all the numbers, the net present value of that pension is $290,756. Amortizing that over a twelve year career adds $24,229.64 to their average salary, making their actual salary before health benefits are added in a tidy $85,631.67, or $97.31 per hour.
If you compare and extrapolate that number to the private sector, it is interesting. Assume that you work an 8 hour day, 50 weeks a year. $194,620 bucks a year is what you would make! Most private sector jobs at that level work a lot more than an 8 hour day. Recently, private sector employment has not been as lucrative as public sector employment. For the first time in American history, it pays to be in the public sector.
Then there's this little dig, which I really like:
However, our society really needs to rethink how we pay our teachers. In aggregate, our schools are not turning out a quality product. The country is falling behind. Our future is in danger. Unionization of education hasn't been good for great teachers, and it hasn't been good for America. It only helped the bad teachers.
The conclusions aren't radical, and they aren't anything you haven't heard proposed before. Some will still try to tell you, and with a straight face, that these changes would be like throwing teachers into the streets or something.