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Amy Traub

“Coddled” Public Employees Make Less than the Private Sector

It’s a truism on the right these days: firefighters, librarians, sanitation workers, and other public employees are lazy and overpaid. They’ve “turned themselves into a coddled class that lives better than its private sector counterpart,” according to Reason Magazine. They are crushing beleaguered taxpayers with their fancy salaries and lavish benefits.

It would be an alarming story if it were true. But a new study by the Center for State and Local Government Excellence and the National Institute on Retirement Security takes a sober look at the data behind the politicized hype and uncovers a very different picture. When workforce factors such as education and work experience are taken into account, state and local employees make less than their private sector counterparts. Looking at pay alone, those supposedly “coddled” state employees earn 11 percent less than comparable private sector workers. Employees of city and county governments earn 12 percent less than their private sector counterparts.

What about those generous public sector benefits? Analyzing data from the National Compensation Survey, the researchers find that benefits such as pensions and health coverage do make up a slightly greater share of public employees’ overall compensation than for private employees. Yet when the cost of benefits is factored in, state and local employees still wind up with less total compensation. People working for local government earn 7.4 percent less than employees with comparable skills could get in the private sector. State employees are compensated 6.8 percent less. So much for the lavish lifestyle.

The new research offers no clarion call for public employee raises and benefit hikes to catch up with the private sector. Indeed, the study documents how public compensation has lagged private sector for twenty years. But it does throw the resurgent right-wing campaign to demonize public employees and their unions sharply into question. In this recession, public employees have been laid off, furloughed, and seen their wages frozen. At a time when public budgets are strained by falling tax revenue, these are among the difficult choices cities and states have made. But that’s no reason to imagine that “greedy” city workers somehow caused the crisis or deserve to lose their jobs or t0 see their pay cut any more than private sector employees. Those looking for a “coddled class” should look to the Wall Street bonus pool, not the Parks Department.

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Posted at 9:14 AM, Apr 30, 2010 in Labor
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