Three (3!) New Studies on How Public Sector Workers Are Overpaid

In today's Wall Street Journal, a heap of new data showing that public sector workers are overpaid, courtesy of the authors of a study that finds public school teachers are overcompensated, relative to their private sector peers.

The Bureau of Economic Analysis has announced that, beginning in 2013, the National Income and Product Accounts of the United States will calculate defined-benefit pension liabilities—and the income flowing to employees in those plans—on an accrual basis that reflects the value of benefits promised, regardless of the contributions made by employers today.

The bureau's reasoning is a 2009 research paper stating that "if the assets of a defined benefit plan are insufficient to pay promised benefits, the plan sponsor must cover the shortfall. This obligation represents an additional source of pension wealth for participants in an underfunded plan." At current interest rates, this adjustment would roughly double reported compensation paid through public pensions.

The Congressional Budget Office endorsed a similar approach last month in a new report on federal employee compensation. The report—which congressional Democrats reportedly hoped would debunk our 2011 paper on federal pay—found that the federal retirement package of pensions plus retiree health care was 3.5 times more generous than private-sector plans, contributing to a 16% average federal compensation premium.

Even more recently, an analysis by two Bureau of Labor Statistics economists, published in the winter 2012 Journal of Economic Perspectives, concluded that the salary and current benefits of state and local government employees nationwide are 10% and 21% higher, respectively, than private-sector employees doing similar work. This study didn't even factor in the market value of public-pension benefits, nor did it include the value of retiree health coverage.

Reason's own Tim Cavanaugh hit many similar notes in his May column, "Bad Apples," released online earlier today: 

“So why has the idea gained currency that public workers are overpaid?” demanded journalist Alan Farnham in a February 2011 article at ABC News. Farnham likewise called for an “apples to apples” comparison and chastised hard-number hawks who rely on data from a sketchy outfit called the U.S. Bureau of Labor Statistics (BLS). 

You get no points for guessing that the BLS numbers unambiguously show public-sector workers making more than equivalent private-sector workers. Total employer compensation cost in 2011 averaged $40.76 per hour for state and local workers; for private industry workers it was $28.24 per hour. The disparities are also big for federal workers. A janitor working for Uncle Sam makes $30,110 a year, while his or her private-sector peer makes $24,188. Federal graphic designers, “recreation workers,” and even P.R. flacks all make between 50 percent and 100 percent more than their private-sector colleagues. ABC’s sources faulted those stats for failing to “take into account workers’ level of education.” 

Get lots more coverage of the war over public sector pensions and benefits

Bonus: The March Reason-Rupe poll found that 67 percent of Americans think government workers receive better health care benefits.

Bonus bonus: 3 Reasons Public Sector Workers Are Killing the Economy:

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  • Hugh Akston||

    Did these alleged studies correct for the fact that public sector employees are all Talosian super geniuses, and therefore deserve higher pay than private sector dullards?

    Considering how much value the dog-shooting, permit issuing, and child incarcerating activities of public employees adds to America, we're lucky they tolerate the meager compensation packages they have, lest the country descend into anarchy.

  • ||

    Fear not the ravenous jaws of anarchy, pitiable serf, for Emperor Barack I Obama is on the case!

  • Hugh Akston||

    I thought His August Majesty was here to see to it that natural selection stays in the classroom where it belongs.

  • ||

    Surely you are the most misinformed subject of the Grand Emperor and Supreme Autocrat that has ever lived!

    The Great Leader is here, in fact, to facilitate the obliteration of libertard rethuglicunts and the racist, bourgeois constitution they promulgate with such tremendous fervor.

  • Dr. Frankenstein||

    I thought the leaders were lizards?

  • Paul.||

    Did these alleged studies correct for the fact that public sector employees are all Talosian super geniuses, and therefore deserve higher pay than private sector dullards?

    The science is settled! Public Sector Workers are underpaid. Consensus!

    I see you were able to keep your regular handle. There's got to be some graft in this system somewhere.

  • Hugh Akston||

    I gave the trolls plenty of time to bogart it, but I was quite disappointed to find that my name just isn't worth all the much.

  • Paul.||

    Neither was mine. I suspect it was the common-ness of it that caused it to get squatted on. I was also in Hawaii during the Great Registration Crackdown.

  • wef||

    Public sector employees will run health care and jail that cracker Zimmerman.

    What more could the public want?

    The future looks brighter and brighter.

  • Old Mexican||

    Re: Wef,

    Public sector employees will run health care and jail that cracker Zimmerman.


    Being Hispanic myself, I resent the fact that you call Zimmerman a cracker. He's clearly a greaser.

  • sloopyinca||

    I thought "greasers" were white, typically of Dago ancestry. I thought hispanics were either spics or beaners, depending on whether they came from the Caribbean or Mexico and Central America.

  • Old Mexican||

    Re: sloopyinca,

    I thought "greasers" were white, typically of Dago ancestry.


    Crackers usually don't care one way or the other.

  • sloopyinca||

    Crackers usually don't care one way or the other.

    You're right, of course. Which explains why I forgot I had typed this for 45 minutes.

  • sloopyinca||

    Pubsec salaries should be determined by:

    Announce a salary and qualifications and ask for resumes.
    If more applicants are there than openings, reduce the salary by 20% and see how many resumes remain.
    Repeat until you have as many qualified applicants as positions, then go up 5% and interview everyone qualified.

    Oh, and no unions.

    Pretty simple, really.

    (SLD applies, obviously)

  • ||

    i don't know if i'd go as far as OVERpaid (hey, but i *am* biased in this regards), but i am very well paid.

    and if you include benefits as part of the "pay" equation, as you should... we get paid very well

    when i was a cop in hawaii, we were underpaid.

    but here?

    damn well paid. i considered when i entered law enforcement, that i was sacrificing pay because i wanted to be a cop, that a lot of jobs i could do would be substantially more lucrative.

    but ... it's more lucrative than i though. and when you factor in benefits, as well as the fact i LOVE my job... well

    oh, and thanks to my union for helping us negotiate a sweet pay raise.

    i almost never work O/t, but man... the OT rate is so choice, it's tempting me

  • sloopyinca||

    Oh, you're here? I figured you were going back to last night's thread to give all of those examples of police being treated more harshly I requested for the umpteenth time, yet you continually fail to come up with.

    should I go check it out, or am I wasting my time again?

  • ||

    sloopy, i lost interest when you made the absurd FALSE claim about how it needed to be CODIFIED as to force situations, when i offered a clear SUPREME COURT case that proved exactly my point about the legitimacy of force and you simply refused to accept it. i tried to explain that it need not be codified.

    that's how force works. there is no codification of foot pursuits, for example. force used during foot pursuits is judged by constitutional case law etc. and i provided irrefutable SCOTUS case law to prove my point

    you almost NEVER offer case law to support your points because your legal points are nearly always wrong.

    i speak with legal experts (real experts) frequently. i have good friends who are defense attorneys and prosecutors. the fact that we are nearly always agreeing about matters of case law is encouraging to me. and then i come here and some guy who clearly does not understand it in the slightest i spend much time negating his claims, but what really is the point?

    i've testified scores of times on 3.5 and 3.6 hearings. i KNOW the law. i've testified as an expert witness in some cases.

    i just get tired to having ot offer a const. law 101 course to you everytime you get butthurt over some perceived injustice.

  • ||

    i offered evidence from both scotus case law AND even an attorney general letter as to citizen arrest for instance, that completely obliterated your claims.

    i seriously doubt that you are capable or willing to admit error. on rare occasions i have been pleasantly surprised (like you finally admitted after much wanking that cops CAN enter a house based on a lower standard than PC when they are acting pursuant to community caretaking function.)

    that was AFTER you ridiculed my claim that cops CAN do this, and after you told somebody else not to listen to me as i was clearly wrong, and that cops needed PC and often PC with a warrant to enter your house w/o permission

  • ||

    again, and again, you are wrong on case law, but you never simply ASK what the case law is... you make erroneous declarations about it and USUALLY when i prove you wrong (see: the claim about how X needs to be "codified" which was abusrd) you evade although again, i give you props for admitting that you were wrong in that case.

    you really do not understand case law or constitutional law. i know you think you do, but arguing case law and constitutional law with somebody who doesn't even have a cursory understanding of it is usually pointless

  • ||

    as for the alleged double standard: sloopy, i have offered examples time and time again. and you offer examples. the difference is i ACCEPT that sometimes cops are given favorable treatment. as far as i remember, you do not accept that sometimes they receive harsher treatment

    what examples do you want? again, the most blatant example i can give is the case i have discussed endlessly here where a judge is on record as STATING that cops deserve a harsher standard, and then sentenced the cop to 22 yrs for assault charges

    and i have challenged ANYBODY to find just one example of this

    1) somebody charged with assault offenses
    2) who is not a convicted felon (the cop was not )
    3) who received over 20 yrs for an assault case

    find me one. in the entire state.

    i can't find one.

  • ||

    i gave the example of alvarez/keller. they were both charged with, and booked for crimes including a felony DESPITE the fact that at the time of their arrest - the victim had not signed a complaint or a signed statement

    and i have yet to see one example in almost 15 yrs of police work in WA state where a custodial arrest was made, and in fact they were called into their workplace and arrested when a victim DID NOT SIGN a formal statement (apart from DV cases, where such arrests are often mandated by law)

    i have never seen one
    http://www.federalwaymirror.com/news/19902469.html

  • ||

    btw, this is another example in case after case i provide where the officers were turned in by another officer. the 'cops never rat on other cops' is so absurd and case after case shows cops are very frequently turned in by other cops

    do you honestly think ANY amount of evidence will ever change your mind? what burden of evidence would have to be met?

    the reality is this. sometimes cops are given favorable treatment. sometimes they are given harsher treatment.

    i accept that, because it's consistent with facts.

    for all those who think they receive special treatment... how come NOT ONE advocate of this (oft repeated theory ) has provided a simple metric that would go a long way

    compare: sentences for cops convicted of crimes with sentences for non-cops convicted of the same crime

    TAKING INTO ACCOUNT prior record (iow you can't compare a cop convicted of crime X with the penalty of a guy with a long record convicted of crime X, since prosecutors (and sentencing matrixes) give substantial weight to prior offenses

    that is ALL that would be needed to prove this theory

  • ||

    and i have yet to see any advocate of this theory present one

    i've seen all sorts of similar data on disparities based on race, gender, income level etc. to support various theories about gender bias, racial bias, class bias, etc.

    something else that would be relevant would be income level, because it's indisputable that people with better lawyers - read MORE expensive lawyers - get better sentences.

    cops often have union paid lawyers, who are usually very very good, but even when the union doesn't pay their lawyer, considering many cops make 6 figures, they have a much better income level to afford a good lawyer vs. the average criminal defendant

    here's another factor i will readily concede. GIVEN a similar fact pattern, juries are imo LESS LIKELY to convict a cop than an average joe

    iow, we can probably agree that juries give cop witnesses and cop defendants more benefit of the doubt and believe they are more credible, ceteris paribus than most other witnesses.

  • ||

    this is not surprising considering that polls i have cited endlessly, show the populace trusts cops more than most (but not all) other professions such as lawyer, salesman, journalist, etc.

    that is CLEARLY a benefit cops have when their case goes to trial, although it's hardly institutional and there is not really anything anybody "in the system" can do about it, since jurors are lay people, not CJ employees.

    that would be a matter of changing hearts and minds, and reasonoids are in a distinct minority in this regards. the general populace overwhelmingly supports and trusts cops

    look at some of the recent cases just in the seattle area (king, sno, and pierce county)

  • ||

    look at the percentage of cops acquitted. it's very high.

    this is one of the reasons prosecutors may give cop defendants rather good plea deals. it's not because they are biased towards them, it's because they know, as a matter of fact, that they have less of a chance of getting a conviction. the lower that probability is, the better the deal the prosecutor offers. that's pretty basic game theory.

    look at this recent cop acquittal

    http://www.seattlepi.com/mount.....424555.php

    you theoretically believe govt. shouldn't waste money right?

    well, in case after case where prosecutors bring (imo often politically motivated) cops to trial, and they are found not guilty (i would bet big $$$ that cops are more likely to be found not guilty than the average defendant), that's a lot of money with no result. plea bargains cost a lot less and offer certainty

    heck, even paul schene got a hung jury ... twice

    and he WAS guilty as fuck imo. that wasn't some sort of systemic double standard in the CJ system. it was (imo) yet another result of JURIES who defer to cops

  • ||

    that , again, is something we CAN agree with . juries like cops.

    but that's not a systemic problem of corruption or people giving cops breaks, which i THINK is your point about the double standard

    i would TOTALLY agree that JURIES give cops a double standard, but as "finders of fact" that is their absolute right. they are the ultimate judges of witness/defendant credibility.

    i would also strongly distinguish cases where cops (in your opinion) used excessive force IN ARREST situations vs. the analogies you try to make with non-cops. you would have to compare citizen ARREST cases with cop arrest cases. that's because the law in general, gives a fair amount of leeway as to force in an arrest

    you were of course stunningly wrong on your knowledge of this in the case where the cop tried to stop the woman who he believed stole his jacket. you, iirc, tried to establish that an off duty cop should be held to the civilian standard, but failed to recognize that 'civilians' can and do make arrests. they don't have to be on their own property like iirc it was you that said that, like a store security guard (they for civil liability purposes usually won't act off their property but CAN just like any other citizen)

    i'm not really sure what evidence you want, but again...

    if you want to make a substantial case then you (or any of the other numerous advocates of this theory) simply need to make a comparison of

  • ||

    cop sentences vs. civilian sentences taking into account prior criminal history, income level, etc. and show that cops receive looser sentences

    not ANECDOTES but aggregate data

    THAT WOULD be very compelling

    i'd love to be wrong, btw, becauise it would mean i learned something.

  • sloopyinca||

    So your response when asked to support your claims with data is to dredge up an old argument which I admitted I was technically wrong about (not morally, which was my overriding point) and ask me to provide data that disproves you.

    Sorry, chief. The way it works is: you make a claim, you back it up. And you've been making the claim for a while now that you could post as many examples of cops being treated more harshly as I could of them getting away with crimes. And all you manage to do is either deflect or go back to beating that dead horse in the case where a cop may have gotten a few more years when he threw his ex-girlfriend out a second-story window...which would have likely ended up as an attempted murder charge for a non-cop.

    Please, for the love of God, will you post your litany of evidence. Seriously, will you or will you not post it?

  • sloopyinca||

    You've offered one example. And you lied about it at first until I called you out on it and did some research.

    So I'll ask...again...where are all of those examples you said you could give to counter the avalanche of police abuse, excessive force, double-standards and preferential treatment that we see here on a daily basis? I'll even give bonus points for your use of citations rather than anecdotal evidence, which seems to be your entire arsenal lately.

  • sloopyinca||

    And just like last night...the crickets chirping is the only noise.

  • Hugh Akston||

    Let's not forget the kickbacks, asset forfeitures, and outright shakedowns.

    When you throw in perks like preferential treatment and "free" services that people offer you to keep you from looking for a reason to bust them, and stuff that "disappears" from the evidence locker, being a cop is a pretty sweet gig.

    Question: does beating someone to death with your Maglite and getting away with it count as a perk or just a job requirement?

  • Paul.||

    Question: does beating someone to death with your Maglite and getting away with it count as a perk or just a job requirement?

    Neither. It's considered a risk. He might fight back. "Stop resisting" is the requirement.

  • Paul.||

    Newly sworn officers for Seattle pd:

    $64,310.40

    http://www.seattle.gov/police/.....salary.htm

  • Hugh Akston||

    I will never have a job that pays that much.

  • Paul.||

    Let alone right out of the gate.

  • sloopyinca||

    But they've earned it by merely applying.

    I'm pretty sure you can get the same caliber of goon for $30k starting, no guaranteed overtime and no taxpayer-funded retirement. Just let them take the shiny toys home to terrify their neighbors and you could probably get a lot of them for even less.

  • rho||

    Ooh, ooh, new metric! Forget that compensation/education one, I have a better one!

    Likelihood you want to call them/average hourly wage.

  • rho||

    Wait, never mind, that puts high class hookers below the DMV.

    Back to the drawing board!

  • Alice Bowie||

    It is not that public workers are overpaid. The reality is that salary stagnation in the private sector has gone on for so so long, the 2-3% annual raises of public workers now look good. Back in the early 90's, I would find a 3% increase in salary an insult. Today, I make less that I made 10 years ago...and not with no math voodoo...in actual $$$s

  • Old Mexican||

    Re: Alice Bowie,

    It is not that public workers are overpaid. The reality is that salary stagnation in the private sector has gone on for so so long, the 2-3% annual raises of public workers now look good.


    That still means that public sector "workers" ARE overpaid, you moron. Above market price.

    "It's not like my tomatoes are too expensive, it's just that my competitors' are too cheap!"

    What an idiot.

  • Alice Bowie||

    And they call me a troll.

    Perhaps annual increases of public workers should be linked to that of the private sector.

  • rho||

    Perhaps public workers should be rendered into cleansing soap and distributed to the poor, who are not as clean.

  • Sevo||

    Alice Bowie|4.11.12 @ 5:35PM|#
    "Perhaps annual increases of public workers should be linked to that of the private sector."

    Alice, three words: Market Clearing Price.
    Your homework; look it up and report. Until then, quit proving you're an economic ignoramus.
    One further comment; anyone who claims to know what a good "should" cost is to be ignored.

  • KPres||

    The reality is that salary stagnation in the private sector...blah, blah, blah...

    Ah, yes, the tired old stagnant wages canard.

    Read it and weep, Alice, then go fuck yourself:

    http://goo.gl/QJXCF


    "the 2-3% annual raises of public workers now look good. "

    Uhh...looks to me like real compensation in the private sector has risen at about 3% over the last 10 years...

    http://goo.gl/ScLMt

    "Back in the early 90's...blah, blah, blah..."

    Nope. Wrong again. Real compensation grew slower from 1990-1995 than it did from 1995-today, dingbat.

  • Paul.||

    It is not that public workers are overpaid.

    If you calculate their benefits and the like as part of their overall compensation, in some cases this compensation has gone up by thousands of percentage points.

  • sloopyinca||

    Actually, I just came up with the best way to hire and pay public employees.
    Put all qualified applicants in a room together and have an auction. You start at $5,000/yr salary and go up from there. Offer $6k, $6.5k, $7k etc and when the first person raises their hand, they get the job and the other people are dismissed from the room.

    It's like a reverse Dutch Auction. And it would work perfectly.

  • Alice Bowie||

    Why not for all jobs public and private...including (and, especially) yours sloppyinca?

  • sloopyinca||

    That is basically how most companies in the free market establish what they will pay their employees. They set a benchmark salary that they think will induce the quality and quantity of employees they will need. If they do not attract those employees, or they have a hard time retaining them, then they move the salary upward. If they are not getting the work out of their employees they want, then they lower it until the proper rate of pay/benefits package is found.

    Don't you know anything about real markets, Alice? Or are you just talking to hear yourself, so to speak?

  • Alice Bowie||

    We didn't just get here from Mars.

    Today, there's a going rate for Doctors, Programmers, Cops, Teachers, Electricians, etc. per demographic.

    I was just wondering if it's ok to change the interviewing process of jobs into an auction...as you proposed.

  • sloopyinca||

    Today, there's a going rate for Doctors, Programmers, Cops, Teachers, Electricians, etc. per demographic.

    And they are all effected by supply/demand. So why shouldn't pubsec jobs be as well?

    And just so you know, if we went to an auction-based hiring system, I'd likely be the guy holding the hammer, so I'd be fine.

  • Alice Bowie||

    So, u wanna b a government worker as you won't cut the BID ?

  • sloopyinca||

    No, shit for brains. I'm an auctioneer.

  • Paul.||

    I was just wondering if it's ok to change the interviewing process of jobs into an auction...as you proposed.

    All real free markets are auctions in a sense. Prices, they're not what you say they are, they're what the market will bear.

  • Sevo||

    Alice Bowie|4.11.12 @ 6:09PM|#
    "We didn't just get here from Mars."
    In your case, I'd need some proof.

    "Today, there's a going rate for Doctors, Programmers, Cops, Teachers, Electricians, etc. per demographic."
    Which rates are set by the competition between the hires on one side and the employers on the other; an auction.

  • Sevo||

    sloopyinca|4.11.12 @ 5:45PM|#
    "Actually, I just came up with the best way to hire and pay public employees...."

    Not sure, it might end up hiring those as incompetent as the current labor.
    Perhaps wait for three hands and interview?
    Which (unfortunately) presumes the interviewer is competent.

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