Report: Public employees make less, including benefits, than private workers

[Better Believe It]

Report: Public employees make less, including benefits, than private workers
By STEVEN VERBURG
February 20, 2011

Gov. Scott Walker argues that public employees can sacrifice more of their paychecks for health insurance and retirement because they pay so little for those benefits compared to workers at private companies.

Walker is correct about the disparity, but a new report by the liberal Economic Policy Institute suggests that looking at benefits alone is misleading.

The study looks at total compensation — pay and benefits together — and found that public workers earn 4.8 percent less than private sector employees with the same qualifications and traits doing similar jobs.

Average compensation for public workers is higher because the jobs they do — such as teaching — require a relatively high level of education, and a higher education is one of the main factors that drives wages up, said Ethan Pollack, a senior policy analyst at the institute. Yet the typical Wisconsin public sector employee with a bachelor's degree makes less than $62,000, compared to more than $82,000 in the private sector, Pollack said.

Read the full article at:

http://host.madison.com/wsj/news/local/govt-and-politics/article_d4093848-3c92-11e0-ac18-001cc4c03286.html

[Omaha Steve]

1. K&R!

[Better Believe It]

3. The chart in the next post makes it very clear and easy to understand how this is true.

[Better Believe It]

2. Wisconsin public sector workers have lower total compensation than private industry workers

Wisconsin public servants already face a compensation penalty
By Ethan Pollack
February 18, 2011

The campaign against state and local workers is often justified with claims that they are privileged relative to their private-sector peers or have somehow been cushioned from the effects of the recent recession and slow recovery. These claims are clearly false.

In Wisconsin, which has become a focal point in this debate, public servants already take a pretty hefty pay cut just for the opportunity to serve their communities (Keefe 2010). The figure below shows that when comparing the total compensation (which includes non-wage benefits such as health care and pensions) of workers with similar education, public-sector workers consistently make less than their private–sector peers. Workers with a bachelor’s degree or more—which constitute nearly 60% of the state and local workforce in Wisconsin—are compensated between $20,000 less (if they just have a bachelor’s degree) to over $82,000 a year less (if they have a professional degree, such as in law or medicine).



The deficit that Wisconsin faces is caused by the current economic downturn and the recent tax cut package. It has nothing to do with the compensation of the people that educate our children, keep the streets safe and clean, keep dangerous chemicals out of our water, and keep insurance companies from taking advantage of us. These public servants are already paid less than those in the private sector, and nationally, this gap has actually been increasing over the past few decades (Bender and Heywood). Instead of opportunistically using these hard times to target workers who—because of their public service—already take a substantial pay cut, Wisconsin politicians should focus on creating jobs and boosting the incomes of all workers.

http://www.epi.org/economic_snapshots/entry/wisconsin_public_servants_already_face_a_compensation_penalty/

[hfojvt]

14. so according to that, the average HS graduate makes $15 an hour

in Wisconsin - in the public sector.

Wow, who knew that Wal-mart was paying so much?

[bbinacan]

4. The data is not accurate.

It looks to me as if the study compares the WI public sector to a national private sector number. It she be WI public vs WI private. If I'm right, this study falls under the old phrase, there are lies, damned lies, and statistics.

[Better Believe It]

5. Will you be contacting the Economic Policy Institute to notify them of their error or "lie"?

Let us know what their response is to your phone call or e-mail which I assume you'll send on Tuesday.

Thanks.

[bbinacan]

7. It may have already been done

Take a deep deep breath. I don't want to see your knee break your jaw.

http://www.politifact.com/wisconsin/statements/2010/dec/12/bryan-kennedy/union-leader-says-wisconsin-state-employees-earn-a/

[Better Believe It]

10. Your link has nothing to do with the article I posted. You have not broken my jaw.

The article I posted which you responded to dealt specifically with Wisconsin statistics and is dated February 5, 2011.

The article you linked to was published on December 5, 2010, last year and concerned national statistics that were released on September 15, 2010, and had nothing to do with Wisconsin employment wages/benefits information.

So will you be contacting the Economic Policy Institute to find out the facts on what you call "lies"?

[bbinacan]

12. Allow me to review

And yes, if they're using faulty data, I will point it out to them. Thanks for your concern.

And if I'm wrong, I'll eat crow.

A lot to digest. Thanks for the info.

[patrice]

9. I think this is a good Reply. Constructive. nt

[patrice]

8. self delete

[csziggy]

11. No it is accurate and does compare WI private vs. WI public sector workers

If you had read the entire very short article linked in the post above and then followed the link to their sources, you might have found this:

When comparisons are made controlling for the difference in annual hours worked, full-time state and local government employees are undercompensated by 4.8%, compared with otherwise similar private sector workers. To summarize, our study shows that Wisconsin public employees earn 4.8% less in total compensation per hour than comparable full-time employees in Wisconsin’s private sector.

<SNIP>

The earnings equation estimates indicate that state and local government employees in Wisconsin are not overpaid. Rather, local and state public employees are undercompensated. When we make comparisons controlling for education, experience, hours of work, organizational size, gender, race, ethnicity, citizenship, and disability, both state and local public employees earn lower wages and receive less in compensation (including all benefits) than comparable private sector employees.
The data analysis also reveals substantially different approaches to staffing and compensation between the private and public sectors, reflecting the different occupational categories within each sector. On average, Wisconsin public sector workers are more highly educated than private sector workers; 59% of full-time Wisconsin public sector workers hold at least four-year college degrees compared with 30% of full-time private sector workers. For college-educated labor, Wisconsin state and local governments pay significantly less than private employers. The earnings differential is greatest for professional employees, lawyers, and doctors. These earnings differences may create opportunities for cutting costs by reviewing professional outsourcing contracts to examine what work might be performed by lower-cost public employees. On the other hand, the public sector appears to pay more for less educated workers by setting a floor on compensation, which particularly improves the earnings of workers without high school educations when compared with similarly educated workers in the private sector, where the earnings floor has collapsed (Lee 1999).

Keefe, Jeffrey H. 2011. "Are Wisconsin Public Employees Overcompensated?", Economic Policy Institute, Washington, D.C., February 10.

There is a lot in that study - well worth the read.

That study is dated February 10, this year, so it is directly applicable to the current situation. And it indicates that Wisconsin citizens are getting a terrific value from their low paid public sector employees. Well educated people are choosing to work for less for the benefit of their state. And how are they getting rewarded - insults, pay cuts and their rights taken away.

[hfojvt]

16. no, it is the usual crap

the bottom line is that public employees make more than private sector employees, and the private sector workers know it.

It is just that the liberal elite likes to argue that public employees DESERVE to make more money than mere tax-paying schmucks. Because the loosers who pay taxes don't have college degrees, so they deserve to make less money. So suck it up, ya bums, we have earned our higher pay.

"59% of full-time Wisconsin public sector workers hold at least four-year college degrees"

You may be surprised at how badly such a report goes over with the general public.

[patrice]

6. K&R

[Starry Messenger]

13. k&r

[HuckleB]

15. k & R!