CBO weighs in with a report on wages
By Joe Davidson,
A report by the Congressional Budget Office will add fuel to the ongoing controversy about federal pay, and it is the workers who will feel the heat.
The report compares private- and public-sector pay and finds that Uncle Sam’s staff sometimes comes out on top.
That contrasts with government calculations using Bureau of Labor Statistics data indicating federal employees average 26 percent less in pay than their private counterparts.
“Workers whose highest level of education was a bachelor’s degree earned roughly the same hourly wages, on average, in both the federal government and the private sector,” according to the CBO. “However, federal civilian workers with no more than a high school education earned about 21 percent more, on average, than similar workers in the private sector, whereas federal workers with a professional degree or doctorate earned about 23 percent less, on average, than their private sector counterparts.”
Regarding benefits: “On average for workers at all levels of education, the cost of hourly benefits was 48 percent higher for federal civilian employees than for private-sector employees with certain similar observable characteristics, CBO estimates.”
The report says 51 percent of the federal workforce has at least a bachelor’s degree vs. 31 percent of the private-sector workforce. While “overall, the federal government paid 2 percent more in total wages than it would have if average wages had been comparable with those in the private sector,” the report said differences in pay “varied widely depending on the employees’ educational attainment.”
Fortunately for Republicans, the CBO report was released shortly before Wednesday’s scheduled House vote on legislation that would freeze the base pay of federal employees, lawmakers and congressional staffers for another year.
Although the CBO found a middle ground in the debate over federal pay, the report is already being used as a hammer against government wages. A statement from the office of Rep. Paul Ryan (R-Wis.), chairman of the House Budget Committee, said “government bureaucrats in Washington continue to enjoy significant advantages over those whose tax dollars finance their compensation.”
American Federation of Government Employees President John Gage had a different view: “This human capital approach compares pay according to demographic traits such as age, gender and race. None of these is relevant for setting pay. No employer would justify paying a woman hundreds of dollars less per week than a man doing the same job, just because labor statistics show that men get paid more than women on average. The very idea is ludicrous, yet those comparisons are at the heart of this CBO report.”
Whatever the point of view of those reading the report, it is significant because the CBO is a respected, nonpartisan agency whose findings generally carry great weight.
The pay freeze bill, as my colleagues Ed O’Keefe and Eric Yoder blogged on Monday, introduced by Rep. Sean Duffy (R-Wis.), goes against the wishes of the White House, which hopes to increase federal civilian worker salaries by 0.5 percent next year, but is consistent with congressional Republican efforts to curtail government spending in part by reducing the payroll.
Duffy’s bill is separate from legislation the House approved in December that would continue the pay freeze to help pay for an extension of the payroll tax holiday.
“While private-sector workers face the squeeze and millions of families continue searching for work, the idea of asking that their hard-earned tax dollars go to fund a pay raise for government employees is just not right,” Duffy said.
Almost no one collecting a federal paycheck has seen a bump in basic pay in recent years. President Obama froze the salaries of top West Wing staffers and political officials after taking office in 2009. On Capitol Hill, lawmakers and their staffs have not had a raise in four of the past six years.
Federal worker unions have opposed any attempts to continue the two-year freeze on basic federal pay. Obama’s 2013 budget request is slated to propose the 0.5 percent increase.
Colleen M. Kelley, president of the National Treasury Employees Union, called the provisions that would freeze congressional pay “a political ploy” that would set up “a Hobson’s choice” that would require representatives to vote against extending the freeze for themselves in order to lift the freeze on federal employees.”
The White House estimates that the two-year freeze set to expire at year’s end will save taxpayers about $60 billion over the next decade.
During last year’s debate over extending the payroll tax credit, House and Senate Republicans proposed spending cuts that would have extended the pay freeze for one more year and forced workers to pay more for their federal retirement plans and separate proposals to cut the federal workforce by 10 percent in the next decade by attrition.
Just as Republicans will use the CBO report to advance their legislative agenda, the study disappoints federal labor leaders.
“This study is a missed opportunity for CBO to remind Congress that the personnel policies of the federal government should be about upholding the principle of equal pay for equal work, and ensuring that federal pay and benefits are sufficient to allow agencies to recruit and retain those with the skills necessary to perform government’s work,” Gage said.