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Another perspective on public employee compensation

Post by Kim Bradford on April 30, 2010 at 2:22 pm with 1 Comment »
April 30, 2010 2:22 pm

State Sen. Debbie Regala, D-Tacoma, emailed me after reading my post about the gap between public and private sector employee benefits. She called attention to a recent study by the Center for State and Local Government Excellence and the National Institute on Retirement Security.

Its findings are quite a bit different than those of the former BusinessWeek economist I cited earlier. For starters, this study disputes the claim that government employees and private sector workers earn about the same. Using Bureau of Labor Statistics data and adjusting for differences in earning power, the researchers concluded:

Wages and salaries of state and local employees are lower than those for private sector employees with comparable earnings determinants such as education and work experience. State workers typically earn 11% less and local workers 12% less.

The pay gap is growing, not shrinking, the study says. It also concludes that while public employees do receive richer benefit packages, they are not so rich as to compensate entirely for lower earnings.

Benefits make up a slightly larger share of compensation for the state and local sector. But even after accounting for the value of retirement, healthcare, and other benefits, state and local employees earn less than private sector counterparts. On average, total compensation is 6.8% lower for state employees and 7.4% lower for local employees than for comparable private sector employees.

The study reports that union workers on the whole make more, underscoring a previous blog comment by LaborGoon who argued the gap exists not between public and private sectors, but between union and non-union workers.

Higher pay for union workers could skew a Washington state comparison of private and public sector salaries. Nationwide, state government payrolls are 39 percent union; Washington’s is 53 percent union.

Leave a comment Comments → 1
  1. Kim, thank you for sharing this.

    I have had a career in three different states as a state employee (yes, I am that old). In each state I was responsible for hiring large numbers of staff, especially at the professional level. I was head of a national committee of state directors that continually looked at state salaries in hard-to-recruit-for positions. My own experience nationally found more similarity with the information in this post than in the BusinessWeek study. When I was appointed to my position in Washington by Gov Locke, I found that Washington State had some of the lowest salaries nationally for Master’s level workers, and, with low benefits . The salaries for general office workers, clerical/office assistants at the High School or BA level fared a little better in Washington than most other states. I would agree that is the result of union negotiations and the dreaded (by conservatives) “leveling” of pay. My opinion is that it allows more people to have a living wage to support their families and enhances state agency productivity to pay general office workers a good salary,a nd I found that to be true in Washington. If you look at the numerous national awards Washington State has received over the years for efficiency in state government, a lot of that is due to the general office staff being highly productive.

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