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CBO says federal employees rake in much more pay

Comparison with private sector likely to heat up debate over ending freeze

- The Washington Times - Monday, January 30, 2012

Buoyed by generous benefit packages, federal workers earn significantly better compensation than similarly educated workers in the private sector, according to a report released Monday from Congress' chief scorekeeper that threatens to reignite at the national level last year's state battles over public-employee rights.

Overall, federal workers earn 16 percent more in total compensation — including wages and benefits — than comparable private-sector employees, according to the Congressional Budget Office. Only private-sector workers with the highest levels of education, such as doctors and lawyers, earn more than their public counterparts.

The finding is incendiary at a time when Republicans in Congress are fighting for a freeze on federal worker salaries and the Obama administration is balking, arguing that after two years of freezes, it's time to ramp up pay.

The CBO said federal workers do better in wages at the low education end, are about equal in the middle, and fall behind the private sector at the top end.

But the key difference is in benefits, where federal workers average more than $20 per hour in compensation — 48 percent higher than the $13.60 in prorated hourly benefits in the private sector. Added together, CBO said, that means significantly higher pay for government employees.

"For workers at all education levels, the cost of total compensation averaged about $52 per hour worked for federal employees, compared with about $45 per hour worked for employees in the private sector with certain similar observable characteristics," CBO analysts said in their report.

Unions that represent federal workers said the CBO's comparison was pointless.

The CBO looked at workers with equivalent education levels, but John Gage, president of the American Federation of Government Employees, said the better approach is to compare specific jobs. On that measure, Bureau of Labor Statistics figures show that federal employees make less than those working equivalent jobs in the private sector.

"Salaries and wages should be a function of the job, not the job-holder — and that's the case in the federal government," Mr. Gage said.

He also said the federal government doesn't consider race, age or sex in employment, and questioned whether discrimination may play a role in holding down pay for some in the private sector.

"The logical implications of a study such as CBO's can border on the absurd. Assessing the cost of hiring certain numbers of whites and racial minorities, young and old, women and men might lead to the ridiculous notion that since the private sector pays, on average, lower wages to women and racial minorities, then to cut costs, the government should hire more people with those demographic characteristics, rather than hire according to skill," he said.

Emboldened by the 2010 elections, new Republican governors and legislative majorities in some states last year battled public workers in attempts to curtail benefits and in some cases strip collective bargaining rights.

The fight was most pointed in Wisconsin, where Gov. Scott Walker is likely to face a recall vote this year over his push, and in Ohio, where Gov. John Kasich's effort to curtail public employee unions' bargaining power was overturned by a referendum in November.

In Washington, the battle has been less heated — in part because Republicans haven't gone as far as their state counterparts, and in part because the GOP and Democrats agreed on halting cost-of-living increases for federal civilian workers in 2011 and 2012. That did not rule out pay increases for merit or promotions, but both sides said it amounts to a freeze.

The House has a vote slated for this week to continue that freeze through the end of 2013 for federal workers, members of Congress and their staff.

"While private-sector workers face the squeeze and millions of families continue searching for work, the idea of asking that their hard-earned tax dollars go to fund a pay raise for government employees is just not right," said Rep. Sean P. Duffy, the Wisconsin Republican who is sponsoring the freeze bill.

But Democrats are balking this time.

After supporting the pay freeze for the past two years, the White House objected in December when Republicans proposed continuing the freeze and using the savings to cover some of the costs of extending the payroll-tax cut into 2012.

Administration officials first said they planned to use the money elsewhere, and then planned to allow a half-percent pay increase for federal workers.

The White House did not respond to a request seeking comment on the CBO report.

The government spent about $200 billion on salaries in 2011, with $80 billion going to pay for the military and $120 billion covering civilian employees governmentwide.

The federal government employs about 2.3 million civilian workers, which is about 1.7 percent of the total U.S. workforce. Another 2.3 million uniformed personnel are employed, including 1 million reservists, and 800,00 people work for government enterprises such as the Postal Service.

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