Federal pay debate raises hackles again

Want to fuel a fire? Talk about federal salaries.

As it turns out, there are three topics people should avoid in polite conversation: politics, religion and federal salaries.

Sen. Ted Kaufman (D-Del.) violated etiquette — and stirred up a fierce online debate — when he took to the Senate floor Sept. 15 to rebut an article by Dennis Cauchon in USA Today that said federal employees on average receive twice the pay and benefits of people in the private sector.

According to USA Today, feds received an average total compensation in pay and benefits of $123,049 in 2009, compared to only $61,051 for private-sector workers.

Kaufman pointed out that the civilian federal workforce is composed mostly of highly skilled and highly educated employees, who tend to earn higher salaries, while most lower-paying jobs are outsourced. “Our federal workforce has also become far better educated in the last 20 years, which also translates into greater earning power,” Kaufman said, as reported by Federal Daily, a sister publication of Federal Computer Week.

When the Federal Daily article appeared on FCW.com, readers got into a heated conversation about the merits of the USA Today article and Kaufman’s response. Many feds were grateful for the senator’s willingness to stand up for them. “Thank you, Sen. Kaufman!” one fed wrote.

(Click here to read all the comments.)

Numerous readers argued that it is difficult to compare salaries because federal job titles often understate the nature of the work. One reader, named Rick, used his own job as an example. “My job title is analyst, but this does not describe all my responsibilities,” he said. “For example, I do program analysis, finance and budgets, building inspections, training, emergency management, physical security and information technology, among others. What job at what level in the private sector would have [all] these responsibilities in one role?”

More to the point, feds who have moved to the private sector say they quickly discovered the full extent of the pay disparity.

“When I retired from the Marine Corps, with 10 years of IT experience, I accepted a position as an IT contractor at a federal agency and nearly doubled my salary,” one reader said. “During my five years as a contractor, my pay increased $28,000. Five years later, when I accepted an identical position at another government agency, as a government worker, I took a $16,000 pay cut.”

But not everyone was buying Kaufman’s argument. For example, several readers pointed out that the statistics fail to include health and retirement benefits, time off and other perks, all of which add up to serious money.

The Cato Institute and American Enterprise Institute, both Washington-based think tanks, have done their own studies that factor in more variables, notes a reader named Jeremiah. “The results are unambiguous and clear: There is a significant and growing pay gap favoring the feds over the ‘great unwashed’ masses outside the charmed federal circle,” Jeremiah said. “The senator is obviously no statistical analyst and is merely the mouthpiece for federal unions and other usual suspects who hope to obfuscate the issue.”

As this issue went to press, the debate was still raging, with readers arguing about pay levels, job performance and even politics. Thankfully, no one has touched on religion.

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Reader comments

Fri, Nov 12, 2010

Federal employees also have to pass a significant background investigation and believe it or not there are people out there who don't pass these. It is true that most of the lower-paying jobs are contracted out and being an IT Specialist I can vouch for the fact that I could make a lot more money on the outside than I do in the government. Why do I stay? Mostly because I like doing work that makes a difference in the world. Regarding benefits - the medical isnt' as great as people think. I had better converage under my ex's insurance when we were married. My TSP is stable and that's definitely a plus. Yes, we do have a pension but that is nothing compared to the stock options lots of tech people get in the private sector. It still rankles me that the same politicians who want to preserve tax cuts for the rich are the ones trying to undermine the very workforce that does all their work - and sometimes it's really dirty work.

Wed, Nov 3, 2010 David Virginia

I hire both Feds and contractors to do IT work. The typical response when trying to recruit high-performing contractors as Feds is: I can't afford the pay cut. We do open "all sources" hiring and high-performers rarely show up on the interview list. If the Fed pay was so great, they'd be clamoring to get in. So it really doesn't matter what the think tanks and their politically-driven studies say. Because the labor market has spoken, and it considers Fed pay to be under market.

Sat, Oct 23, 2010

Dig deeper on pay parity. Private sector pays "low salaries" as their baseline proposition. It's the fundamental factor for paying employee benefits throughout the business year. In good times most "free-will" companies establish bonus contracts with employees that are based upon the company's business plan...if they meet or exceed their business plan, then a portion of the company's profit margin goes to pay bonus contracts (with taxes and employee benefits coming out of the bonus as well). That said, it's not unheard of (in good times especially) for valued employees to negotiate 1/3 or more of their salary amount above their earned salary, e.g., salary is $60K/yr and full bonus is $20K/yr. So, the first thing to go in the "free-will" private sector are bonuses, then layoffs, then salary cuts on remaining employees and maybe a few small gap-filler bonuses for everyone left riding out the storm...but the mentality is survival. A clear economic forecast is essential to tweak the business plan and achieve growth followed by more hiring and more productivity. Then the salary and bonus flows up again until the next downturn. Retired military in 2004 and went to work in the private sector...lived it. Now working civil service and the system will never resemble the adaptive flow of the private "free-will" sector...organized labor positions have similar plagues in adapting to the economic cycle. Seems that government employees and unionized employees have to chase the critical mass of private sector workers making "tons of money" during the good times or they lose parity...and when the bad times hit the roles are reversed. My original point on salary disparities is an apples and oranges comparison...I don't think that everyone is on the same page as to what are the components of each in "annual earnings"....

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