Should Federal govt. civilian employees make more than private sector counterparts?

[Omar Little]

The Congressional Budget Office (CBO) released a study that on average total compensation for civilian federal government employees is approx. 16% higher than their private sector counterparts: http://www.cbo.gov/doc.cfm?index=12696

The study made comparisons based upon persons education level: (no college, some college, bachelors degree, masters degree, and doctorate degrees). In all cases except for doctorate degrees, the total compensation for people working for the federal government exceeded their private sector counterparts.

One analyst (http://www.powerlineblog.com/archive...s-overpaid.php) argues that in his opinion most federal employees work less than their private sector counterparts and have greater job security (i.e. harder to fire).

So should this be the model for running the federal government? Higher pay, less work, greater job security?

[elninost0rm]

Nevermind

[Simplicio]

Aren't federal employees basically a) the military and b) post-office workers? I don't think any other area of the gov't employees many people in comparison to those two. In the former case I imagine the good pay is due to the hardships of the job and in the latter due to a strong union.

[ITR champion]

I don't see it as a "should" question that we can answer positively or negatively. Millions of employees, both private and public, negotiate for their salary and the figures in that study represent an aggregate of the results of those millions of negotiations. If federal employees on average are getting more than private-secotr employyes, it's probably because they're more organized and unionized and this helps a lot when negotiating.

Of course the fact that a manager in the federal government has less personal motivation to save on labor costs than an owner in the private sector may also have an influence.

[fumster]

Originally Posted by Omar Little

So should this be the model for running the federal government? Higher pay, less work, greater job security?

Constructing straw men is hard work and should be compensated at a higher rate.

But seriously, some blogger says: "perhaps for doing less work" and nothing at all to back it up.

But in any case I am enraged. It used to be that in this country you could have a job that paid well enough to support a family, have a some degree of job security, and know that when you retired there was a pension and medical insurance available.

Starting in the 60s, Conservatives have attacked traditional American values. In the old days there we respected hard work and looked askance at people who made their livings pushing around pieces of paper. The bible makes it clear that usury is against God's will, but conservatives don't care; they have made their pact with the devil. Thanks to them we have fewer union workers and conservatives have passed so called "right to work" legislation in many states

These days conservatives wouldn't cross the street to spit on a janitor, who in all likelihood is a non-union, part-time worker contracted out so that they don't have the benefits allotted to the paper pushers.

So yes, I am outraged that the private sector pays 16% less than the public sector. I blame the 60's for that. In the 50s everything was OK.

[TriPolar]

What we see now may be the result of the poor economy. Wages for government workers may have continually climbed based on cost of living increases and negotiated union contracts while there has been wage stagnation in the private sector. This could easily turn around in an economic boom.

It is also very difficult to determine what a comparable job is between the public and private sectors.

[howye]

Wow, nice use of an incredibly shitty blog. Do you think the author used his jump to conclusions mat on that "less work" claim?

And that doesn't even address the underlying issues raised by the CBO study, if you except it as gospel. Look at the CBO graph. Note that the Fed. employees make more than private sector employees claim holds true only for wages and only for positions requiring less than a bachelor's degree. A bachelor's degree is equivalent pay, while higher educated fed. employees are paid a lower wage than their private sector counterpart. Ever wonder why the best fed. employees take their knowledge and jump to the private sector?

But the benefits, that means they are still compensated better than private sector employees! First, I can't spend vacation time or vision insurance at the grocery store, can you? Second, professional degrees or doctorates are still receiving less compensation than their private sector counterparts. Yes, keep the janitor for thirty years, but let the institutional knowledge in your lawyers and PhD's go out the door.

Also, you will note that the benefits part of the bar graph is used to make the difference between lesser educated employees look even greater. However, reading the note on the benefits methodology this is stated: measuring benefits was also more uncertain. That is, not every employee will use insurance or other benefits. But the fed. government employees thousands of people, so we will just come up with a number.


As sh1bu1 pointed out, perhaps the real tragedy lies not in that fed. employees are provided with such high benefits but that so few private sector employees are.

[erislover]

The chart at the link in the OP addresses the question I'd have immediately. These "overpaid" workers are relatively low-salary folks. The government doesn't have a lot of the costs that private firms do, especially with regards to things like paying CEOs and upper management, distributing profits to shareholders, and so on.

I don't know how you could make a valid comparison here, since the government basically takes on things that have to be done that private firms can't or won't do (basically---let's not argue particular things here). Even if they could, I've always said that the flipside of "government waste" is "private profit"---little guys aren't getting the benefits either way. Now I see that maybe I was wrong. Government waste is little guys getting the benefits.

[Jas09]

So basically government jobs pay better if you have little to no higher education, and give much better benefits. At higher education levels private companies pay better and give better benefits.

None of this seems particularly shocking to me. Maybe I'm missing something? Haven't government jobs always been seen as the holy grail for those without higher education? And haven't these private-sector jobs been exactly the ones being outsourced (manufacturing) or undercut by immigrant labor (agriculture)?

[Baracus]

Originally Posted by TriPolar

What we see now may be the result of the poor economy. Wages for government workers may have continually climbed based on cost of living increases and negotiated union contracts while there has been wage stagnation in the private sector. This could easily turn around in an economic boom.

This isn't true for the civilian federal employees in the OP though. Federal employees do not receive a "cost of living" increase. Their pay raises are based on the Employment Cost Index, which is supposed to reflect the change in compensation in the private sector. As such the feds received a 1.5% increase in 2010 and 0% in 2011 and 2012, the latter two years being due to budget concerns rather than a 0% ECT. I believe automatic step increases were frozen as well at one point but I don't now if that has changed.

[Voyager]

Originally Posted by erislover

The chart at the link in the OP addresses the question I'd have immediately. These "overpaid" workers are relatively low-salary folks. The government doesn't have a lot of the costs that private firms do, especially with regards to things like paying CEOs and upper management, distributing profits to shareholders, and so on.

Also, private companies have in large measure outsourced low paying jobs. My company, a high tech one, has excellent benefits. The nice ladies who empty the trash don't work for us, but work for a contractor.

As for the main point, all the previous posters got it in one. Perhaps the right is outraged by the prospect of any worker not getting screwed by his or her employer.

[TriPolar]

Originally Posted by Baracus

This isn't true for the civilian federal employees in the OP though. Federal employees do not receive a "cost of living" increase. Their pay raises are based on the Employment Cost Index, which is supposed to reflect the change in compensation in the private sector. As such the feds received a 1.5% increase in 2010 and 0% in 2011 and 2012, the latter two years being due to budget concerns rather than a 0% ECT. I believe automatic step increases were frozen as well at one point but I don't now if that has changed.

Yes, but the difference may already have existed following the 1.5% increase in 2010. And as I mentioned, the comparability of these jobs is questionable.

[even sven]

Originally Posted by ITR champion

Of course the fact that a manager in the federal government has less personal motivation to save on labor costs than an owner in the private sector may also have an influence.

Do government agencies not have budgets? I don't think you really understand how things work.

I do think the government best fulfills the old fashioned concept of American labor- one where a person can go in with relatively low skills and, through hard work, persistence and learning, work their way up to the middle class. It's what manufacturing used to offer. There are also some negatives to government work. At the higher level, it pays much, much less than the private sector. And it's a tough place for a go-getter with innovative ideas. Private organizations are, probably by necessity, more likely to reward risk.

But hey, if you want to see America continue down the path of disposable, permanently underutilized workers living on the edge of poverty, I guess that's your thing.

[Euphonious Polemic]

Originally Posted by Omar Little

One analyst (http://www.powerlineblog.com/archive...s-overpaid.php) argues that in his opinion most federal employees work less than their private sector counterparts and have greater job security (i.e. harder to fire).

I think that factual conclusions that are based on one bloggers opinion are not worth the electrons it took to produce them.

If no factual evidence, statistical analysis or studies are produced, then it can just be chalked up to one bloggers opinion that federal employees work less than their private sector counterparts. Thanks for your opinion buddy.

[shiftless]

During the internet boom, IT people were jumping out of the government as fast as they could. There was big money to be made. Now that the economy has turned down they are lining up to get those government jobs. They need to compare lifetime compensation, not just a few choice years and they should include work environment too.

If I'm not mistaken, they do this study all the time. The news agencies only get excited when they find out government employees might be getting more than them.

[Really Not All That Bright]

Originally Posted by Simplicio

Aren't federal employees basically a) the military and b) post-office workers? I don't think any other area of the gov't employees many people in comparison to those two. In the former case I imagine the good pay is due to the hardships of the job and in the latter due to a strong union.

As of 2010, the uniformed services made up a little over a third of federal employees.

Those people aren't counted in the study- according to the CBO, it counted only civilian employees- but the DoD employs a little over 800,000 civilians, or a little under a third of all civilian federal employees. Not sure whether civilian DoD workers skew the statistics.

One interesting point (internal citations omitted):

The federal government paid women higher wages, on average, than private-sector employers did but paid men similar wages. Adjusted for the differences in the other measured attributes, the average wage for female federal employees was 6 percent higher than the average wage for women in the private sector, whereas the average wages for men were similar between the two sectors. Nevertheless, men earned more than women in both sectors, on average, but the difference was smaller for federal employees. If the lower average wages for women resulted from discrimination, then the higher wages that women tended to earn in the federal sector could have been the result of federal employers being less discriminatory.

[Kimmy_Gibbler]

Originally Posted by Omar Little

One analyst (http://www.powerlineblog.com/archive...s-overpaid.php) argues that in his opinion most federal employees work less than their private sector counterparts and have greater job security (i.e. harder to fire).

The entirety of the analyst's "argument" that federal employees work less and have better job security is reproduced below:

There can be no doubt that federal employees enjoy much greater job security than those in the private sector. It is not unreasonable to conclude that federal employment is a very good deal: 16% more compensation, on the average, perhaps for doing less work, and certainly with better job security.

In short, it amounts to conclusory assertions and baseless speculation. Not one scintilla of evidence is offered for either proposition.

What the data do show is that the wages+benefits of federal employees is higher than for public sector counterparts at all below the doctorate/professional degree level.

I'd also point out that when considering wages alone, this effect holds only below the bachelor's degree level. I have some misgivings about the wages+benefits argument because it often appears to be used to bamboozle employees. ("Well, sure, we only pay you $30K in wages, but we pay $50K when you consider benefits too!" "OK, pay me $45K and I'll get my own health insurance." "Uh... no thanks.")

If I'm right about this, that straight wages are less subject to manipulation and a better point of comparison, then I think there's little cause for concern about overpaid federal employees.

[Damuri Ajashi]

The study points out that if they could pay private sector pay and benefits to federal employees, then the government could save 2% on its payroll costs.

I would suggest that when the people who were on the old pension system retire, the cost of the current workforce will go down considerably. I don't know if this study does this but a previous study included payments made to the pension plan to top off deficiencies for pensions paid to people who had retired years ago.

I don't know about the lower end of the scale but most of the lawyers I know take a 50%+ pay cut when they go to work for the government. Of course not every federal lawyer can double their income by leaving the government but a LOT of them can. and almost all of them can increase their total compensation significantly.

[Voyager]

Originally Posted by ITR champion

Of course the fact that a manager in the federal government has less personal motivation to save on labor costs than an owner in the private sector may also have an influence.

But very large numbers of people work in private industry which are not mom and pop shops, and where getting bigger budget means having more power. For pay, the average manager sees an upside for bigger raises - happier employees - and no downside, since pay comes out of a different bucket than expenses or capital.

Example: a friend of mine was the CTO of a company selling electronic equipment which was smaller and cheaper than the competition. He said that they thought that they could waltz into the office of the manager who oversaw a floor full of this kind of equipment and sell a bunch without working up a sweat. Turns out, this was a negative. The managers prestige was directly proportional to the size of the floor, and asking to buy a $1 million piece of equipment gets you a slot at the board of directors meeting - and some visibility - while a $100K purchase gets signed off two levels up. I use this as an example in my behavior engineering economics class.

[YogSosoth]

Federal government employees are not being paid too much. Private sector employees are being paid too low.

[Really Not All That Bright]

Originally Posted by Voyager

I use this as an example in my behavior engineering economics class.

Is that an economics class, an engineering class, or a psychology class?

[Duckster]

I've lost more than 50 percent of my team to retirements. I'm denied the authority to advertise and fill the vacancies. My travel and training budgets have practically been eliminated. My COLAs have been frozen the last two years, and projected to be frozen at least two more, meaning I'm not keeping pace with inflation. I'm only receiving a within-grade-increase (WGI) because I've received perfect outstanding ratings the last three years, and only in the past year had a permanent supervisor who could sign off on a QSI.

Congress has frozen this and cut that, except the statutory requirements I must follow. So I've not been authorized to reduce my workload, and with unfillable vacancies on my team, their statutory obligations must also be met by those of us who remain. According to a number of salary equivalency sites, my pay is about 30 percent less than private industry. However, if I include all the statutory requirements I must meet, and several job functions of which there is no real private equivalent, I'm due a 217 percent raise. Yeah, right. Let's not forget the ten federal holidays I'm required to take (I'm not complaining). Nor my use/lose leave I take (because I earned it and I'm not giving it back to my employer gratis). Those also account for the projected pay raise I mentioned.

Lastly, there's a twist. This post isn't a rant, pitty party based on my job. I enjoy it. I do it very well. The taxpayers are doing well by me. My concern, my anger, are those who fall victim to these surveys, like the OP posted, that don't actually address real world numbers. Federal civilian employment has hovered around two million for some 70 years, going back to FDR. The US population in that same period has more than doubled to about 310 million. Congress has passed program after program after program, with little regard to properly funding these programs. You also don't hear about the phenomenal growth of civilian contractors, about four times as many for each federal employee. Their salaries all too often greatly exceed federal equivalent salaries. But you never hear about them and how much they cost you.

You also seldom hear, on average, federal employees are better educated, and more skilled, than their private counterparts. Finally, let's not forget government is not business. Regardless of the rhetoric, the politics, and the mudslinging, everyone of my customers (that's you) must be treated equitably, fairly, and honestly, even when you crap on me that I'm overpaid and underworked. You are entitled by law, as I am required to provide to you those services, by law. So perhaps the extra compensation you think I'm getting (and undeserved according to some) is about keeping the lights on and fires burning, especially when the shit really hits the fan and you end up coming to me for help that you know you will receive.

[Voyager]

Originally Posted by Really Not All That Bright

Is that an economics class, an engineering class, or a psychology class?

Yes.

It is taught by my daughter, who has degrees in economics and psychology, and my, who has degrees in engineering. In my specialty there have been many papers, and some books, about the economics of engineering decisions. I used to get funding based on models of the savings from what we did. While we got the money, I never believed in our models. There were a lot of other mysteries. Once I saw what my daughter was studying about behavioral economics it all became clear.

[Steve MB]

Originally Posted by erislover

The chart at the link in the OP addresses the question I'd have immediately. These "overpaid" workers are relatively low-salary folks. The government doesn't have a lot of the costs that private firms do, especially with regards to things like paying CEOs and upper management, distributing profits to shareholders, and so on.

More to the point, the President and Congresscritters can't cut the pay of rank-and-file workers and funnel the difference directly into their own pockets. Private-sector executives can and do. That right there creates extra downward pressure on private-sector wages.

Originally Posted by Jas09

So basically government jobs pay better if you have little to no higher education, and give much better benefits. At higher education levels private companies pay better and give better benefits.

This supports the conclusion that the underlying difference is that the civil service retains a decent bare-minimum floor in terms of health coverage, etc. that has severely decayed in the private sector -- a difference that shows up primarily at the lower levels and is irrelevant at the higher levels where the private sector can't (yet?) push the floor down below that minimum.

[gunnergoz]

Government and its employees are a favorite whipping boy today, with many claims that government is inefficient, bloated and unresponsive. Do the people who believe that honestly think that paying what government employees there are, less, will actually improve things?

I'd like to think that federal, state and local governments hire only the best and do what they can to keep talent and reward performance.

I don't want my water tested by a minimum wage flunky or my freeways designed by a college dropout. I don't want my public health workers to be the bottom of their class, nor do I want the air traffic controllers to fall asleep because they need to work two jobs.

Seems pretty simple to me...you get what you pay for.

[ataraxy22]

I'm a federal employee. I work in a small office where all of us hold a scientific PhD, except for one who "only" has a Masters, and our front desk person, who isn't even a Federal employee, because secretarial positions have mostly been made into contract positions, thanks in part to Bush II's love of Circular A-76 (not to be confused with Order 66 from Star Wars).

Given that many of the lower paying jobs that once were held by Federal employees are now held by contractors, obviously the average pay for the remaining positions is higher than it was before, even accounting for inflation.

Federal employees have not had a cost of living increase since January 2010. President Obama wants to give us a paltry 0.5% increase in January 2013, but the Republican-lead House is determined that we don't even get that. If we get nothing in January 2013, we won't see an increase until January 2014 at the earliest.

Meanwhile, my agency's budget has flat-lined. We can't hire anyone new, but our workload keeps increasing. For FY12, performance-based bonuses can be no more than 1% of the total payroll, so managers don't even have much ability to reward high performing employees. So much for encouraging innovation.

Our travel and personal training budget has been slashed by, I think 80%, which means we are slowly losing touch with progress in the field and becoming more isolated. Morale is sinking, and the best people are starting to bail.

We are the favorite scapegoats of politicians and journalists, who have managed to make a not insubstantial percent of the public think we are the enemy, thereby deflecting the blame from big corporations and their interlocking directorates.