Pay Gap: A Different Take (Government workers overpaid)

http://www.govexec.com/dailyfed/0506/051806pb.htm ^

[lauriehelds]

The pay gap between private and public sector employees seems to be a given. Just this week, 10 congressmen made their case for a higher 2007 civilian pay raise than President Bush has requested by citing a 30 percent private-public gap reported by the Bureau of Labor Statistics.

"The federal government may never be able to compete with the private sector, dollar for dollar, but we must ensure that we do not fall further behind in the battle for talent," Reps. Tom Davis, R-Va.; Jon Porter, R-Nev.; Steny Hoyer, D-Md.; Chris Van Hollen, D-Md., and others said in a letter to fellow members.

But a new paper from the libertarian Washington-based think tank the Cato Institute argues that the pay gap actually travels in the other direction. Pointedly titled "Federal Pay Outpaces Private-Sector Pay," the paper by Chris Edwards, the institute's director of tax policy studies, makes the case for freezing government salaries.

By bundling federal benefits -- including defined pensions, the Thrift Savings Plan and health care subsidies -- together with wages, Edwards calculated that the average federal worker earned $100,178 in 2004, compared to $51,876 in salary and benefits for the average private-sector worker. Those numbers were based on statistics from the Bureau of Economic Analysis.

"The federal civilian workforce has become an elite island of secure and high-paid workers, separated from the ocean of private-sector American workers who must compete in today's dynamic economy," Edwards wrote.

In an interview, Edwards said he is trying to stir the pot on an issue that has no real adversaries. Federal employee unions are so vocal on pay issues, and Washington-area congressmen, including Republicans like Davis, who chairs the Government Reform Committee, are loyal to the many federally employed voters in their districts, Edwards said.

He said he suspects the BLS studies that find such a marked pay gap, and which do not take benefits into account, are flawed.

"There are questions about how these comparisons are done," Edwards said. "If you, say, look at a government lawyer versus a private lawyer, or accountants, the responsibilities and the hours worked per week can be quite radically different."

Most compelling, he argued, is the quit rate for federal employees, which is quite low and suggests that workers are satisfied with their pay.

Edwards said in his paper that some academic studies have found government workers to be overpaid, but his citation is a 1985 study by Steven Venti at the National Bureau of Economic Research.

Why did he pull from a 20-year-old study? Because, he said, there has been so much agreement in recent years on the pay gap that no one has bothered to complete an updated independent analysis.

[durasell]

A lot of the lawyers I've known in gov't service are adrenaline junkies. Very early in their careers they were were faced with a choice:

A)Wall Street and earning $200,000+ a year doing contracts and IPOs

B)$40,000 a year putting bad guys in jail.

Not even a choice. They went for the $40,000.

[VOA]

My moment of awakening about "public service" jobs came during a trip to Minneapolis.
I took a city bus for a few trips around town as it was convenient.
One time, the bus was pretty empty and the driver struck up a conversation.
He was friendly, but it soon became an Italian opera about how he might
not break $100,000 this year due to being sick a few weeks.
In-Freakin'-Credible...

[codercpc]

I contract out through the Federal Government, and because of their union regulations, any company that contracts with them, must pay an equitable rate to what their Government workers make. I can tell you, for my job, their is no where in my geographic area that pays nearly what I make.

I am not trying to call you out, because I have no idea what you do, and I am sure you are worth every penny you make. But from my experience (I get to physically see the quality of work that my Government counterparts do), they are no where near as qualified as the people in my company. I don't mean to brag, but I must maintain at least a 95% perfection rate, or I could lose my job, and from the completed work that I see, from their end, if they reach a 45% correct rate it would be amazing.

[dennisw]

As a federal employee, I completely disagree with this bogus "study." We don't make big bucks in the federal government, I assure you. Believe me, the taxpayers are getting their money's worth!

That's bullcrap. Federal pensions are fantastic. Same for medical

[muawiyah]

Having known many hundreds of government lawyers over the years, I'd say the biggest factor was their prior inexperience with how a lawyer makes money in a private practice.

A couple of them I knew had a father or uncle in law, but they were a distinct exception.

Only knew a couple of guys who'd worked for major law firms before coming into the government.

[aimhigh]

Edwards calculated that the average federal worker earned $100,178 in 2004, compared to $51,876 in salary and benefits for the average private-sector worker.

The big problem with averaging salaries is that he's comparing burger flippers with case workers and analysts. I'm not a federal employee, but I've looked at job announcements for jobs I'd qualify for, and they aren't that great.

[muawiyah]

That's 3 personal days a year more than I ever saw.

Think about it ~ how would you have ended up being prosecuted in a federal court for fraudulently misusing them?

The federales have absolutely nothing comprable to "personal days".

[Joan Kerrey]

Believe me, the taxpayers are getting their money's worth!

I guess it depends on the position and the tasks one must do but I used to pick up my hubby whenever I could get off early after working a mgt job of 10 hour per day average. If I wasn't there at 5:00pm on the dot he'd catch the bus. His job as a clerk (clerks in my work area made $15.00 per hour) paid $68,000 per year plus overtime, plus fully paid 1/2 wage retirement, plus flex time, Plus accumulated sick and vacation, plus child care, plus, plus, plus and plus. He retired at 50 and I'm still working my butt of. If I had it to do over I'd work for government. Private sec tor is way under government in compensation.

If I went out the door daily at exactly 5pm I wouldn't have a job for long.

[meyer]

It's not the big bucks. It's the four to six weeks vacation, generous health benefits, and defined benefit pension. All benefits that largely do not exist any more in the private sector.

I've been on both sides of the federal vs. private industry wall. In the type of work I do, the pay is very similar (though that varies considerably from one part of government to another). I'm back up to 3 weeks of vacation (down from 4 in the private sector), health benefits are weaker at dot-gov, and the pension is a defined contribution plan. In the private industry, I had a defined benefit pension.

Unfortunately, we are among the feds that still have to pay into social security.

[muawiyah]

NOTE: getting the chance to put the bad guys away is a common thread for an awful lot of the lawyers I knew in the government ~ that, plus the chance to go to the US Virgin Islands in the Spring for the courtroom cases. That's where they tried the bad star-route carriers who'd violated their contracts.

[BW2221]

The government should hold steadfast when anything like the IBM situation happens. Unfortunately, too many times government contracts are written so the vendor is profitable no matter how badly he screws up. That isn't right.

But, unfortunately those contracts are agreed to by people way up the corporate or government ladder.

[dennisw]

Public sector employees lack the opportunities presented in the private sector.

So what. Gubbermint jobs are better that private sector and Federal jobs are pure cream. Secretaries get paid outrageous amounts and minorities get great Fed jobs in the DC area due to affirmative action. The benefits are better than what GM workers get

[muawiyah]

No doubt you are not delivering mail. 95%? ROTFLMAO. If USPS only made 95% people would be shooting letter carriers in the streets.

[durasell]

I gotta tell ya, at a dinner party -- put me next to the guy who puts bad guys behind bars and seat the boy billionaire hedge fund kid as far away from me as possible.

[muawiyah]

The way the federal pension system works out the employees pay for their own pensions.

If I took every penney I'd paid into CSRS or FERS over the years and did nothing but invest it in T-bills, I'd have a higher pension today.

That, BTW, is one of the biggest errors made by the fellows at CATO Institute ~ they forgot about who pays for those pensions.

[heights]

All I know this that I have a hard time getting a week off a year. My niece,a government worker is forever traveling in Europe. She and her husband,also a gov worker have taken more time off in the last two years than I have in my life.

[operation clinton cleanup]

I recall getting 13 days per year for many years. Then it was 20 days, and then 26 days. However, no one that I can recall getting 30 days vacation out of the feds.

I got 30 days off per year while serving in the Air Force! Of course now I only get 10 days per year in the private sector.

[sphinx]

I have had some fairly extensive exposure to a large federal agency which shall remain nameless. My impression is that the senior managerial types -- the 14's, 15's, SES's and politicals -- are working their fannies off. At lower grades, it varies. BTW, most of the career folks at that level are pretty sharp people.

One problem is that it is basically impossible to fire deadwood, so the deadwood piles up. Many federal employees are quite outspoken about this because they (the good ones) have to work around the problem cases. A second problem is that Congress very often won't let agencies reform. The "iron triangle" has three sides, and sometimes it is turf-protecting subcommittee chairmen and grant-protecting NGO's that frustrate any attempt to reorganize.

Just try to close a federal office in any small town and see what happens. Senior managers in Washington are being squeezed by tight budgets would rationalize the operation. Congress won't let them. As to the budget, remember that it's entitlements that are growing out of control, not discretionary domestic spending.

[BW2221]

What's your annual vacation? Like I said, my only government experience was in the military and I got 30 days leave a year.

In the private sector, you typically start with 2 weeks, which increases to 3 weeks after 5 years and 4 weeks after 10 years.

[dennisw]

BTW, no federal government employee gets anything called "personal days". Most smart employees save up their sick leave for that heartattack they're going to have in 30 years after listening to all this whining by private sector probate lawyers.

Are you with the Feds or collecting from your former job with them?