Average Government Worker Receives 85 Percent Higher Pay, Benefits than Private Employees, Conservatives Say

September 23, 2010 - 11:00 AM
Conservative scholars say federal employees are 'paid too much.'

(CNSNews.com) – Forget studies that say federal workers make twice what private sector employees make. Research compiled by analysts at conservative think tanks has found that the average federal employee receives 85 percent more in compensation, including wages and benefits, than private sector employees who perform the same jobs.

Chris Edwards, director of tax policy studies at the libertarian Cato Institute, has studied the discrepancies between federal compensation and that received by their private sector counterparts and concluded that federal government workers are vastly overpaid.

Edwards said his analysis of Bureau of Economic Analysis data clearly shows that wage increases for government workers have far exceeded those of workers in the private sector.

“Overall trends are really dramatic,” said Edwards. “Over the last 9 years, average private sector wages and compensation in the U.S. have risen about 30 percent, but average federal wages and compensation have risen about 60 percent.”

The typical federal worker received a salary of more than $79,000 in 2008, with benefits raising total annual compensation to more than $119,000. The typical private sector worker received pay of about $50,000, with total compensation just under $60,000.

Edwards was one of three conservative experts who presented their data at a discussion panel held Tuesday at The Heritage Foundation in Washington, D.C.

James Sherk, a senior policy analyst in labor economics at The Heritage Foundation pointed said that those employed by the federal government not only receive more in compensation they also get other benefits like increased vacation time.

“Let’s say you’ve been in the government for three years,” Sherk said. “In addition to sick leave and 10 federal holidays, you qualify for 20 days -- four weeks -- of paid vacation a year. There very few private sector workers with four years on the job getting four weeks of paid vacation a year.”

Both Sherk and Edwards pointed out that federal government employees are also promoted much more quickly than employees in the private sector. These promotions make it even less likely that employees would leave their government job.

“There have been a number of academic studies and some work from the Congressional Budget Office that shows that the over-promotion of federal employees means that people would generally have to take a step down in position if they left the government and entered the private sector,” Edwards said.”

Sherk admits that in terms of government spending, cutting back on benefits like government pensions and laying off federal employees would only be a drop in the bucket when viewed as part of long-term deficit reduction.

However, Sherk said that it is possible to take some steps to make the system less costly. Giving jobs like landscaping and security to private firms, moving to a system where government workers are rewarded for merit rather than seniority and bringing federal pay down so that it is closer to what the market offers would all be effective ways to make the system less costly and that these steps would resonate with voters.

“Bring the federal pay in line with what’s there in the market,” said Sherk. “If they want to stay on that’s fine, if they don’t want to stay on that’s also fine.”

“We found that when governments attempt to make their long-term budget outlook more promising, one of the best predictors of them being able to do that is being able to reduce government pay and at least bring it down to market levels.  When they do that they establish legitimacy with the voters.  Voters understand that they are serious about these things.”

Edwards said that the federal government should not hesitate to lay workers off during recessions as many private sector businesses are forced to do. He also recommended a temporary pay freeze for federal employees and said that Congress should hire a private firm like Price Waterhouse to conduct an audit of the federal government in order to determine where the government could make cuts.

Sherk was quick to point out that the recent recession has only increased the number of employees on the federal rolls and the job security that this provides during difficult economic times serves as a huge incentive for people to seek government employment.

“Federal employments are up 10 percent,” he said. “If you’re in the federal government you have not felt this recession. Federal employees don’t want to go into the private sector where they might feel it. It goes to show that by their very own actions they’re demonstrating that they think they’re getting a better job in government.”

“If you’re in the public sector you’ve felt basically nothing of the recession,” he added.