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InsiderOnline Blog: January 2012

CBO Agrees Federal Workers Are Overpaid

Federal workers get paid about 16 percent more in total compensation than comparable private-sector workers, according to a new study by the Congressional Budget Office. The CBO study compared federal civilian employees to private sector workers who resembled them in education level, work experience, and other observable characteristics. The CBO’s approach is broadly consistent with that taken by Jason Richwine of The Heritage Foundation and Andrew Biggs of the American Enterprise Institute.

The CBO found federal workers receive a 2 percent pay premium and a 48 percent premium in benefits. Total federal employee compensation runs around $200 billion per year, and saving 16 percent of that would amount to a 10-year savings of about $390 billion, notes Biggs.

In their own research published last year, Richwine and Biggs found a 61 percent premium in total compensation for federal workers. They found a larger premium in part because their calculation includes the value of greater job security that comes with federal employment. That factor alone, they estimate, is worth about 17 percent of pay.

Read More:
Comparing the Compensation of Federal and Private-Sector Employees,” The Congressional Budget Office, January 2012.
Comparing Federal and Private Sector Compensation,” by Jason Richwine and Andrew Biggs, American Enterprise Institute, June 2011.
Same Worker, Higher Wage: A Study of Workers Who Switch from Private to Federal Employment,” by Jason Richwine, The Heritage Foundation, June 15, 2011.

Posted on 01/31/12 06:18 PM by Alex Adrianson

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