Myth busting: The “overcompensated” public employee

The Center for Economic and Policy Research and the Political Economy Research Institute recently released a fascinating report “The Wage Penalty for State and Local Government Employees in New England.”

The report refutes claims from anti-union pundits and the media that government employees make more than private sector employees. In fact, the report’s results show that government workers at the “high-wage” level, like supervisors and managers, often make 13 percent less than their private sector counterparts.

As Author Jeffrey Thompson explains,

If you simply compare the wages in the public and private sector, you end up learning more about the skill levels of those workers than about the sector where they work. All that comparison tells you is that state and local government workers in New England are more highly educated and more experienced than their counterparts in the private sector. But once you properly control for education and experience, it becomes evident that public sector workers get lower wages.”

The reality is that in New England, though government workers receive moderately better benefits like holidays and pensions, they on average take home less then private sector employees. This is echoed on the national scale where the public employment penalty ranges from three to seven percent on average.

As state and local governments examine their ever-shrinking budgets, it is important to remember that public workers and their unions should not be made the scapegoat for the economic mess we’re in—for that, we have Wall Street to thank.

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This entry was posted on Friday, September 17th, 2010 at 1:28 pm and is filed under General, Jobs. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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