NCPA - National Center for Policy Analysis

Federal Workers Earning Double Their Private Counterparts

August 11, 2010

At a time when workers' pay and benefits have stagnated, federal employees' average compensation has grown to more than double what private sector workers earn, a USA Today analysis finds.

Federal workers have been awarded bigger average pay and benefit increases than private employees for nine years in a row.  The compensation gap between federal and private workers has doubled in the past decade. 

According to the latest data: 

  • Federal civil servants earned average pay and benefits of $123,049 in 2009 while private workers made $61,051 in total compensation, according to the Bureau of Economic Analysis.
  • The federal compensation advantage has grown from $30,415 in 2000 to $61,998 last year. 

Chris Edwards, a budget analyst at the libertarian Cato Institute, asks, "Can't we now all agree that federal workers are overpaid and do something about it?" 

Last week, President Obama ordered a freeze on bonuses for 2,900 political appointees: 

  • For the rest of the 2 million person federal workforce, Obama asked for a 1.4 percent across-the-board pay hike in 2011, the smallest in more than a decade; federal workers also would qualify for seniority pay hikes.
  • Congressional Republicans want to cancel the across-the-board increase in 2011, which would save $2.2 billion. 

"Americans are fed up with public employee pay scales far exceeding that in the private sector," says Rep. Eric Cantor (R-Va.), the second-ranking Republican in the House. 

What the data show: 

  • Federal workers received average benefits worth $41,791 in 2009; most of this was the government's contribution to pensions. Employees contributed an additional $10,569.
  • The average federal salary has grown 33 percent faster than inflation since 2000.
  • USA Today reported in March that the federal government pays an average of 20 percent more than private firms for comparable occupations, but the analysis did not consider differences in experience and education.
  • Federal compensation has grown 36.9 percent since 2000 after adjusting for inflation, compared with 8.8 percent for private workers. 

Source: Dennis Cauchon, "Federal workers earning double their private counterparts," USA Today, August 10, 2010. 

For text:

http://www.usatoday.com/money/economy/income/2010-08-10-1Afedpay10_ST_N.htm 

 

Browse more articles on Tax and Spending Issues