Federal pay freeze
The Washington Post reported earlier this week that “President Obama told congressional leaders Tuesday that he is extending a two-year pay freeze for federal employees until at least next spring because Congress has not agreed on a budget for the next fiscal year.” The freeze is expected to last until early next year, when an expected continuing resolution to fund the government expires.
As expected, public-sector union leaders were quick to pounce. J. David Cox, the president of the American Federation of Government Employees, called the freeze “unconscionable” and argued that “federal employees cannot afford another four months or even another day of frozen wages.” In fact, federal employees are compensated at a much higher rate than their private sector counterparts.
A recent paper by The Heritage Foundation noted that “a January 2012 report by the Congressional Budget Office (CBO) shows that federal government employees receive substantially higher compensation than similarly skilled workers in the private sector.” The CBO concluded that “the average federal worker receives wages that are 2 percent higher than a similarly skilled private-sector worker, and benefits that are 48 percent higher. The average federal worker receives total compensation (wages plus benefits) 16 percent higher than market levels.
A pay freeze would bring federal employees’ pay more in line with the pay of their private sector counterparts.
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Brian Darling is Senior Fellow for Government Studies at The Heritage Foundation (heritage.org).