Overpaid or underpaid? A state-by-state ranking of public-employee compensation

Article Highlights

  • A remarkably large variance exists in the way that different states pay their employees.

    Tweet This

  • Merely because public pay could in theory differ from private levels doesn't constitute evidence that it does differ.

    Tweet This

  • We have produced the first comprehensive state-by-state comparison of public- and private-sector compensation.

    Tweet This

Abstract

This paper ranks all 50 states according to how costly their public-employee
compensation packages are relative to private-sector standards. Each state’s package is
placed into one of five categories: modest penalty, market level, modest premium, large
premium, or very large premium. The results show that national-level analyses obscure
significant differences in compensation from state to state. Connecticut, for example,
pays its state employees 42 percent more than what similar private-sector workers
receive, but Virginia pays its state workers about 6 percent less. State-by-state political
interest in public-sector pay aligns fairly well with our results: In states where publicsector
pay is an active political issue, state government employees appear to be better
compensated than similarly-skilled private sector workers. In states where state
government compensation is at or below market levels, pay for public employees is
generally less controversial.

 

 

 

Also Visit
AEIdeas Blog The American Magazine
About the Author

 

Andrew G.
Biggs

What's new on AEI

AEI Election Watch 2014: What will happen and why it matters
image A nation divided by marriage
image Teaching reform
image Socialist party pushing $20 minimum wage defends $13-an-hour job listing
AEI on Facebook
Events Calendar
  • 20
    MON
  • 21
    TUE
  • 22
    WED
  • 23
    THU
  • 24
    FRI
Monday, October 20, 2014 | 2:00 p.m. – 3:30 p.m.
Warfare beneath the waves: The undersea domain in Asia

We welcome you to join us for a panel discussion of the undersea military competition occurring in Asia and what it means for the United States and its allies.

Tuesday, October 21, 2014 | 8:30 a.m. – 10:00 a.m.
AEI Election Watch 2014: What will happen and why it matters

AEI’s Election Watch is back! Please join us for two sessions of the longest-running election program in Washington, DC. 

Wednesday, October 22, 2014 | 1:00 p.m. – 2:30 p.m.
What now for the Common Core?

We welcome you to join us at AEI for a discussion of what’s next for the Common Core.

Event Registration is Closed
Thursday, October 23, 2014 | 10:00 a.m. – 11:00 a.m.
Brazil’s presidential election: Real challenges, real choices

Please join AEI for a discussion examining each candidate’s platform and prospects for victory and the impact that a possible shift toward free-market policies in Brazil might have on South America as a whole.

Event Registration is Closed
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.