New Data Show Feds Are Paid 78 Percent More Than Rest Of U.S. Workers

Mark Tapscott Executive Editor, Chief of Investigative Group
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America’s 2.1 million career civil service workers make on average 78 percent more in total compensation than private sector workers, according to new data compiled by the U.S. Bureau of Economic Analysis.

The total compensation average for federal workers is $119,934, including the value of leave, insurance and other perks, or 78 percent more than the average total compensation for private sector employees of $67,246. The BEA analysis excluded U.S. Postal Service workers.

The 2014 average federal salary in 2014 of $84,153 compared to $56,350 for all private sector workers. The 2014 salary average represented the first annual increase since 2011 when a partial pay freeze was implemented in a budget deal between President Obama and House Republicans.

“The federal government has become an elite island of secure and high-paid employment, separated from the ocean of average Americans competing in the economy,”said Chris Edwards. Edwards is tax policy studies at the Cato Institute and editor of the libertarian think tank’s www.DownsizingGovernment.org.

In an analysis of the BEA data published Friday by Cato, Edwards described the generous tax-funded benefits received by federal workers.

“Federal workers receive health insurance, retirement health benefits, a pension plan with inflation protection, and a retirement savings plan with a government match. They typically received generous holiday and vacation schedules, flexible work hours, training options, incentive awards and generous disability benefits,” he said.

Other factors explaining the pay and compensation disparity between federal workforce and private sector employees, Edwards said, are reflected in the comparative rarity of layoffs and firings in the bureaucracy and the low rate of civil servants voluntarily leaving government employment.

He pointed to Bureau of Labor Statistics analysis that found layoffs occur in the government only one-fourth the rate of those in the private sector. Data also demonstrates that federal workers are  dramatically less likely to be fired than private sector employees or to leave voluntarily. And private sector CEOs are 20 times more likely to be fired than the top executives in the federal bureaucracy.

“Federal workers know that they have a lucrative combination of compensation and job security, and so they stay much longer than in other industries,” he said.

“It is sometimes assumed that the federal government should employ the nation’s highest-skilled workers, and that it should pay top dollar to get them. But federal hiring of the very best workers imposes an ‘opportunity cost’ on the economy by drawing talented people away from higher-valued activities in the private sector,” Edwards said.

“Unlike, say, France, where the best university graduates historically have gone into government, the United States has historically prospered because the best and brightest have flocked to places such as Silicon Valley.”

Edwards said that “federal pay should be reasonable, and we need competent people in federal jobs, assuming that the jobs are useful ones. But the government should not be one of the highest-paid industries in the nation.”

Lower federal pay would encourage more turnover and attract a greater number of younger workers with fresh ideas, he said.

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