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View Diary: Understanding The Attacks On Public Employees (216 comments)

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  •  Why does private sector pay higher wages? (1+ / 0-)
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    I can think of at least four reasons:

    • The private sector finds it easier to rip off their customers, because their internal finances are kept hidden and bidding processes are usually flawed. In a depressed-wage economy, it is easy to pass down a few extra dollars (which the public sector does not have) to the lower rungs.  Note that a few extra dollars does not imply an equitable wage.

    • The work is actually 'worth more' than either private or public sectors are willing to pay.  In a high-unemployment market, this can mean that over-qualified people are settling for lower-wage jobs, or that just-qualified people are settling for lower wages.  In this case, both public and private sectors get better workers than should be expected for the wages.  

    • In a highly competitive job economy, by paying only slightly more, the private sector can hire substantially better employees.  Again, this doesn't mean they end up paying equitable wages.

    • Workers who work for private companies know that they can get chopped at their employer's slightest whim.  Public workers can't.  That in itself will produce a wage differential.  

    •  That last point is big. (1+ / 0-)
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      Eikyu Saha

      I might get chopped so I need to get paid more to compensate them for the risks they are taking in doing that job. Then when the chips are down they get to criticize public sector workers for their job security? Typical having your cake and eating it too.

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