Powered by OpenAIRE graph
Found an issue? Give us feedback
addClaim

Are Public-Sector Employees 'Overpaid' Relative to Private Sector Employees? An Overview of the Studies

Authors: Joseph E. Slater; Elijah A. Welenc;

Are Public-Sector Employees 'Overpaid' Relative to Private Sector Employees? An Overview of the Studies

Abstract

The laws eliminating or severely restricting the collective bargaining rights of public-sector unions passed since 2011 are one of the most important developments in both workplace law and politics in recent memory. Among other things, public-sector workers now comprise more than half of all union members in the U.S., and such unions are a major constituency of the Democractic Party. Proponents of these new laws often justify them at least in part by claiming that public employees are overpaid relative to private sector employees. This paper focuses on a large and representative selection of studies comparing the compensation of public- and private-sector employees. It reviews their findings and methodology, noting the assumptions and data-sets used. It also draws some conclusions as to the policy implications of the works discussed herein. In sum, a majority of studies have found that public workers on the whole are paid somewhat less than comparable private sector employees, but there are significant dissenting voices. A consensus has formed around a few findings. Studies almost all find that at the very bottom of the pay scale, public workers enjoy slightly higher compensation than their private-sector analogs, while at the upper end of the scales (lawyers and other professionals, e.g.), public workers are paid less than comparable private-sector employees. Most of the disagreements, therefore, are about employees in the middle of the pay scale. Second, almost all studies agree public workers receive less “take home” pay than private-sector workers, but they generally receive more generous health and pension benefits. When combining pay and benefits, a majority of studies still find a “public-sector penalty,” but others do not. Important methodological differences include how to calculate the value (and current cost) of future benefits, how to compare certain types or ranges of jobs across sectors, and whether to assign value to “job security” for government employees. For example, some public-sector jobs have direct private-sector analogs (janitors and lawyers), and some do not (police and firefighters). Furthermore, even jobs with the same title may not involve the same work. Also, controlling for employer size seems to matter: Studies that do not use such controls are more likely to find a public-sector premium than studies that do.

Related Organizations
  • BIP!
    Impact byBIP!
    selected citations
    These citations are derived from selected sources.
    This is an alternative to the "Influence" indicator, which also reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
    0
    popularity
    This indicator reflects the "current" impact/attention (the "hype") of an article in the research community at large, based on the underlying citation network.
    Average
    influence
    This indicator reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
    Average
    impulse
    This indicator reflects the initial momentum of an article directly after its publication, based on the underlying citation network.
    Average
Powered by OpenAIRE graph
Found an issue? Give us feedback
selected citations
These citations are derived from selected sources.
This is an alternative to the "Influence" indicator, which also reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
BIP!Citations provided by BIP!
popularity
This indicator reflects the "current" impact/attention (the "hype") of an article in the research community at large, based on the underlying citation network.
BIP!Popularity provided by BIP!
influence
This indicator reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically).
BIP!Influence provided by BIP!
impulse
This indicator reflects the initial momentum of an article directly after its publication, based on the underlying citation network.
BIP!Impulse provided by BIP!
0
Average
Average
Average
Upload OA version
Are you the author of this publication? Upload your Open Access version to Zenodo!
It’s fast and easy, just two clicks!