Seventy Percent of Michigan School Districts Contract Out for Services

Latest survey results show continued widespread use of private contractors

Friday, October 19, 2018

Holly Wetzel
Communications Coordinator

MIDLAND — A new survey released today by the Mackinac Center for Public Policy found that 70.5 percent of Michigan’s school districts use private contractors for support services.

As districts look to save money, many have chosen to privatize various services. This survey examined whether districts contract out for food, custodial or transportation services. The privatization rate has remained at roughly 70 percent for the past four years.

While the number of districts that use privatization remains high, many districts report that it has become increasingly more difficult to recruit and retain both in house and contracted staff.

James Hohman, director of fiscal policy at the Mackinac Center and co-author of the survey, explains the steady support for privatizing services. “Privatization moved from a rarity to something practiced by a majority of school districts in Michigan,” said Hohman. “It has allowed districts to save money while still being provided a quality service.”

In addition to looking at what, if any, services a district contracts out, the survey also asked whether the district was satisfied with the contracted services. As with previous findings, high levels of satisfaction were reported, with 95 percent of districts reporting that they were satisfied with their services.

There was a four-district decline compared to last year, as the 2017 survey found that 71.1 percent of districts contracted. Those that brought their services back in house largely did so because of concerns over the quality of services provided to private contractors. Only one district expects to save money from the move.

“A better economy has tightened the labor force and provided school districts with more revenue, but it also has slowed the growth of contracting,” said Hohman. “When this survey was first conducted in 2001, only 31 percent of districts contracted out. The economy has changed a lot since then, but the majority of districts still take advantage of the savings that privatization affords.”

You can view the complete survey results here.

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