Why can't the disagreement over which sector earns the most be settled for once and for all?
The discussion about federal pay never seems to end, with people arguing that feds are either underpaid or overcompensated. But couldn’t the debate be settled once and for all by looking at actual salary data?
It’s not as simple as it seems. Speakers at an event sponsored by the Coalition for Effective Change in June highlighted how the seemingly easy task of determining whether feds are paid more, less or the same as their industry counterparts is fraught with challenges because of the different methodologies used.
Rex Facer, a member of the Federal Salary Council and an associate professor at Brigham Young University, said the council’s research and data from the Bureau of Labor Statistics show that feds are undercompensated on average between 30 percent and 40 percent. However, Joseph Kile, assistant director of the Microeconomic Studies Division at the Congressional Budget Office, disagreed, saying CBO estimates indicate that feds, in general, make roughly 2 percent more than private-sector employees.
The disparities sparked a discussion among FCW readers who commented on the story and on a follow-up post on the “Management Watch” blog. The majority said feds are underpaid and stressed how even decades of experience do little to bump up salaries.
“Federal employees never have and never will make as much as the private sector — that’s just the nature of the beast,” reader David said. “We have always been 15 to 25 percent behind on all of the wage surveys I have read for the localities I have worked in over the years. Unfortunately, that gap has increased even further due to the [pay] freeze.”
A reader posting under the name Spacedude said that even with years of know-how, he was still earning less than his private-sector colleagues. “I am near the upper end of the government pay scale, and after several decades of being a federal employee, I can truthfully say my counterparts in industry earn more,” he said.
Reader Carol echoed those sentiments, saying that despite her three decades as a fed, she made far less money than her industry peers. “I am a GS-11 in the IT field and earn at least $20,000 less a year than my counterpart on the outside with the same certification,” she wrote.
Another reader who has worked in both sectors shared how a transition from industry to government resulted in a significant salary decrease. “I worked in an IT job in St. Louis as a team leader,” Atlanta wrote. “I moved to a GS-13 office chief. Other than increasing my supervisory responsibilities, the work was very similar. I took a $14,000-a-year pay cut. I made the move after [the 2001 terrorist attacks], and I wanted to help my country.”
But lower government salaries often come with attractive benefit packages that are unheard of in the private sector. Agnes, whose industry career spanned 15 years, recently joined the government and noted that the public sector “has good benefits long term, good vacation time if accumulated.”
Reader Paul acknowledged the great benefits he has as a fed but said his move to the public sector came at a price that went beyond a pay cut. “With all the added benefits, I figure I came out slightly ahead but realized later that I also gave up much chance for career progression,” he wrote. “Now that I'm a fed, I'm trapped in one job, in one area, and have no flexibility and no promotion options. I'm having to look at getting a third degree just to hope I can see some movement.”
Ultimately, people choose to work where they can receive maximum compensation, and money doesn’t always come out on top, reader John said. “Obviously, the federal government offers them a better total package than they think they can get in the private sector,” he wrote. “Compensation includes pay, health care benefits, holidays and vacation, sick leave, retirement plans, and a stable work environment — not just a salary.”
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