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View Diary: Federal workers out-earn private sector ones ... at the low end. At the high end, they earn less. (66 comments)

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  •  There are 1000s of blue collar feds at the DoD (5+ / 0-)

    maintenance depots.

    The blue collar guys do a get a great deal compared to their counterparts these days.  The private sector was much better compensated than the feds 40 years ago (Pre Reagan).  Both have decreased benefits since.  

    The feds still have dignity.  The private sector should be forced to raise it's standards.  

    This machine kills fascists!

    by Zotz on Tue Jan 31, 2012 at 01:48:40 PM PST

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    •  Exactly (5+ / 0-)

      Federal workers aren't overpaid. Private sector workers are underpaid with lousy benefits, if any, to boot. It's a reflection of the wage suppression in the private sector over the last several decades which has lined the pockets of investors and CEO's. Exorbitant profits are unpaid wages.

      Wages in the private sector haven't gone up commensurately to public sector workers because of the trend in the private sector to squeeze wages in order to meet Wall Street profit expectations.

      48forEastAfrica - Donate to Oxfam "Compassion is the radicalism of our time." ~ Tenzin Gyatso, 14th Dalai Lama -7.88, -6.21

      by Siri on Tue Jan 31, 2012 at 02:08:21 PM PST

      [ Parent ]

    •  Bingo. The right question is 'What's Happened to (2+ / 0-)
      Recommended by:
      SueDe, Zotz

      the Private Sector?"

      Before using average Private Sector compensation as a measuring stick, there's an important question to ask:

      Has private sector compensation kept up for the 99% since 1980?

      Many folk would say,   "no" (more than a few would specify 'hell no'.)  

      In significant part the lagging private sector compensation since the 1980s  is why the Social Security program which was balanced in the early 80s, is now projected to come up 10 or 15% short in a few decades - because wages have not increased as they were projected to increase in the income levels covered by Social Security (though I'd be willing to bet we're at or above GDP projections on which such balancing was deemed accomplished.)

      To compare private and public sector pay today is to accept that private sector wages and benefits have increased sufficiently over the last 30 years to provide an appropriate standard against which to measure compensation levels.  

      What the RightWing is saying is that public sector pay should follow private sector pay in some game of limbo, how low can you go.

      What would the CBO comparison look like over time?  I remember seeing charts that compared public sector and private sector increases over the years.  It's not that public sector compensation ever skyrocketed, it just did not flat-line like most private sector compensation did (except of course for the golden few - the 1%).

      If the private sector had provided the same modest increase in wages and benefits over the last 30 years as the public sector had, how much more would private sector workers be getting?

      This CBO analysis assumes the current private sector wage level is a standard we should aspire to meet,
      instead of a sinking problem that threatens the purchasing power of the middle class consumers and undermines our economy (with its 70% reliance on consumer spending.)

      It also assumes the current private sector benefit level is a standard we should aspire to meet (not greater but fewer people with health insurance and fewer people with individual retirement plans and fewer people with sick leave), even given its cost impact on government-sponsored programs for medical care coverage, welfare and retirement.

      For instance, how can it be that only 6 out of every 10 workers in the private sector have access to paid sick leave?  (State/Local employees = 90% so I assume Fed is even higher.)

      And in calculating costs, did the CBO factor in the fact that the private sector offers retirement benefits to only 64% of its employees and only 76% of those participate:  Net 49%. (Did CBO calculate the cost of retirement benefits per employee using all employees or only those participating in each benefit?  Same questions for medical care benefits.)

      I've also got a couple other 'quibbles', in part because the CBO does not provide enough information to know how they approached these issues - other than assurances that they made 'adjustments' for them.

      1.  Size (of Employer) Matters.
      (CBO says it took size into account, but fails to show how it did that.)

      If you work for a company with 10 employees your wages and benefits are likely to be less than a similar company with 100 or 1000 employees.

      Wages are higher and benefit packages more frequently offered and better in terms of employee share of costs and employee participation.  

      According to the CBO report:

      The Federal Government is 100% "1000 employees or more".

      Only 4 % of the private sector falls into that size category.

      Over 1/3 of the private sector employees work for companies with less than 100 employees.  

      Another 22% work for companies with between 100 and 999 employees. (pg 16 of 28 pdf )

      Why does that matter?  

      When the entire population of one is in the 1000 or more and a full 1/3 of the other is in the 'less than 100, it's important to compare apples to apples.

      For the difference of just the 1/3 of private sector employees in companies of less than 100 employees, average comparable federal employee costs would be inflated by almost 13% (% decrease in comp of 39% for private employees in small settings x % of total sample 33%.)  The CBO says it adjusted for employer size but fails to provide the backup to show how they adjusted.

      According to another BLS report:  

      Private Sector Total Comp/Wage/Benefit Cost Difference by Size of Employer

      # Employees             Avg Total Comp
      Less than 100              $27.85
      500 or More               $45.44

      Private Sector Wage Difference by Size of Employer

      # Employees             Avg Total Comp
      Less than 100              $19.57
      500 or More               $28.26

      Private Sector Benefits Cost by Size of Employer

      # Employees             Avg Benefits Cost
      Less than 100              $8.29
      500 or More               $17.18

      Employer Costs for Employee Compensation  December 2011
      Table 13. Private industry, by major industry group and establishment employment size and bargaining status

      2.  Benefit Take-Up Rate (Not clear what CBO did on this.)

      In counting average costs, its also important to know what the CBO decided to use as the divisor.  (Otherwise you are mixing an investigation into the cost of benefits or how rich the package is, particularly per-employee costs,  with whether or not the various categories of employers being compared offer those benefits and offer them in a way that their employees decide to participate.)  (Access x take-up rate = participation)

      If you have only 50% of one category participaing in a given benefit, the the average cost for all employees in that category is reduced because of the 1/2 that are not even participating.)

      The significant differences in 'take-up' rate on benefits between Private and Govt (as shown in this comparison done by the BLS between Private sector and Local/State Govt employees.)

         Sixty-four percent of all private industry employees had access to retirement benefits, compared with 90 percent of state and local government employees. Eighty-five percent of state and local government employees actually participated in a retirement plan, compared with 49 percent of private industry workers. (See table 1.)

      Retirement Benefits   Available   Take-Up Rate  Participate

      Private Industry:       64%              76%                  49%
      State and Local:        90%              95%                  85%

       Medical care benefits were available to 69 percent of private industry workers, compared with 87 percent among state and local government workers. About half of private industry workers participated in a medical plan, compared with about three quarters of state and local government workers. (See table 2.)

      Medical Benefits   Available   Take-Up Rate  Participate

      Private Industry:       69%              73%                 51%
      State and Local:        87%              83%                 72%

       Paid sick leave was available to approximately two-thirds of workers. Nearly 9 out of 10 state and local government workers had access, compared with approximately 6 of 10 private industry workers. (See table 6.)


      It would be nice if the CBO made public the working papers to show how they arrived at their 'adjustments'.  

      The time has come to put the "Occ" in "DemOCCracy". Support (or create) the "Occupy" movement near you. Ordinary Citizens Count in this extraordinary Democcracy.

      by Into The Woods on Tue Jan 31, 2012 at 03:54:20 PM PST

      [ Parent ]

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