North Dakota

Employer Costs, Take-Home Pay, and Tax Wedge for an Average Manufacturing Wage Worker in NORTH DAKOTA

Annual Amount

Rank

Total Cost to Employer*

$29,465

**

Take-Home Pay

$22,785

12

Take-Home Pay, % of Employer Costs

77.3%

**

Tax Wedge*

$6,680

**

Tax Wedge, % of Employer Costs

22.7%

**

Gross Earnings

$27,200

Taxes Withheld from Worker's Paycheck

Social Security/Medicare Payroll Tax

$2,081

Federal Income Tax

$2,048

State Income Tax

$287

40

-----------

Total Taxes Withheld

$4,415

Hidden Taxes Paid by Employer on Worker's Behalf

Social Security/Medicare Payroll Tax

$2,081

Workers' Compensation Contribution

N/A

**

State Unemployment Insurance Tax

$128

36

Federal Unemployment Insurance Tax

$56

-----------

Total Employer-Paid Taxes

N/A

Employer-Paid (hidden) Share of the Tax Wedge

N/A

**

Source: Dean Stansel, "The Hidden Burden of Taxation: How the Government Reduces Take-Home Pay," Cato Institute Policy Analysis No. 302, April 15, 1998.

*Total cost to employer does not include the cost of fringe benefits (such as employer contributions to private health insurance plans and pensions) and tax and regulatory compliance. The tax wedge does not include the host of other taxes--property taxes, sales taxes, gas taxes, cigarette taxes, etc.--that workers must pay with their remaining take-home pay.
**North Dakota is one of the seven jurisdictions in which the workers' compensation system does not allow private insurers to provide workers' compensation insurance. Instead, employers must pay into a monopolistic state fund. As a result, comparable estimates of the workers' compensation costs were not available. Therefore, the estimates for total employer costs and the tax wedge in these states are not directly comparable because they do not include an estimate for workers' compensation costs (which were, on average, $1,395). These states were not included in the rankings for those items.


Last Updated on 4/8/98
By Mark LaRochelle