Inflated Federal Employee Pay Costs Taxpayers $47 Billion a Year
Federal employees paid more than private sector workers, taxpayers foot the bill
WASHINGTON, D.C.— With government spending impelling huge deficits, budget hawks are looking for ways to reduce the government’s burden on taxpayers. One avenue to reduce government expenditures is to bring federal employee compensation (wages and benefits) in line with those in the private sector. A recent study by the Heritage Foundation’s James Sherk shows that workers in comparable fields and occupations are paid disproportionately more when employed by the federal government. The following figures from Sherk’s study illustrate this point:
• Federal employees’ hourly wages are 22 percent more than workers in the private sector
• Aligning federal workers’ compensation with market rates would save taxpayers $47 billion a year
• When combining wages and total benefits, federal employees earn 30-40 percent more than private-sector workers
• Full-time federal employees can take 13 paid sick days a year along with all 10 days of national holidays
• Federal employees with ten years of experience earn on average ten more sick days a year than private employees.
• The average federal civilian employee earns on average $32,115 a year in non-cash compensation compared to a private sector employee who earns three times less, $9,882 annually
• Over 81 percent of federal employees participate in employer-sponsored pension plans compared to less than half (47.9 percent) of private sector employees
• Federal employees receive 22.0 percent more in employer payments toward their health care than their private sector counterparts
• During the recent recession (2007-2009) the private sector unemployment rate jumped to 9.4 percent from 4.2 percent while federal unemployment barely increased to 2.9 percent from 2.0 percent
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