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
  • 27
    MON
  • 28
    TUE
  • 29
    WED
  • 30
    THU
  • 31
    FRI
Monday, October 27, 2014 | 10:00 a.m. – 11:30 a.m.
State income taxes and the Supreme Court: Maryland Comptroller v. Wynne

Please join AEI for a panel discussion exploring these and other questions about this crucial case.

Tuesday, October 28, 2014 | 9:30 a.m. – 12:15 p.m.
For richer, for poorer: How family structures economic success in America

Join Lerman, Wilcox, and a group of distinguished scholars and commentators for the release of Lerman and Wilcox’s report, which examines the relationships among and policy implications of marriage, family structure, and economic success in America.

Tuesday, October 28, 2014 | 5:30 p.m. – 7:00 p.m.
The 7 deadly virtues: 18 conservative writers on why the virtuous life is funny as hell

Please join AEI for a book forum moderated by Last and featuring five of these leading conservative voices. By the time the forum is over, attendees may be on their way to discovering an entirely different — and better — moral universe.

Thursday, October 30, 2014 | 2:00 p.m. – 3:00 p.m.
A nuclear deal with Iran? Weighing the possibilities

Join us, as experts discuss their predictions for whether the United States will strike a nuclear deal with Iran ahead of the November 24 deadline, and the repercussions of the possible outcomes.

Thursday, October 30, 2014 | 5:00 p.m. – 6:15 p.m.
The forgotten depression — 1921: The crash that cured itself

Please join Author James Grant and AEI senior economists for a discussion about Grant's book, "The Forgotten Depression: 1921: The Crash That Cured Itself" (Simon & Schuster, 2014).

No events scheduled today.
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.