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Federal workers are falling farther behind on pay, study shows

White collar federal employees are underpaid on average by about 35 percent compared with the private sector, a widening of the “pay gap” that stood at about 26 percent last year, an advisory group said Friday.

The Federal Salary Council based that number on data from the Bureau of Labor Statistics that by law are supposed to be used in setting annual General Schedule pay raises that vary by locality. However, in practice federal pay raises are negotiated in the congressional budget process.

Salary rates have been frozen since they last were increased in January 2010 and it already has been decided that rates will not increase at least until April 2013.

Members of the council, which consists of union leaders and outside pay experts, attributed the increase in the gap to the freeze and to some changes in the methods BLS uses in its pay comparisons.

“This clearly shows that there is a pay gap and that federal employees are underpaid,” said J. David Cox, president of the American Federation of Government Employees and a council member. “Hopefully we can get back to reasonable cost of living adjustments and work on the pay gap.”

“I think on federal pay there’s too much misinformation and fiction out there,” said National Treasury Employees Union president Colleen M. Kelley, also a council member. “There’s a very long history to this methodology. Even if someone wants to argue with what the number is, it’s important to address that there is a gap and it continues to grow. There’s no way to make the number zero, if you’re basing it on facts.”

The data reflect differences among metropolitan areas, showing federal workers the farthest behind in San Francisco/San Jose, Washington-Baltimore, San Diego, New York and Los Angeles. The difference was the smallest for employees working in areas outside the 31 city areas that are studied specifically.

While federal pay has been a long-running issue, the cost of the federal workforce has drawn heightened scrutiny in the last several years, and especially during this year’s presidential campaign. In addition to proposing a 10 percent workforce cut through attrition, Republican nominee Mitt Romney argues that federal workers are overcompensated by 30 to 40 percent on average.

That assertion is based on a study by the conservative Heritage Foundation that included the value of benefits; based on salary alone, that study found an average advantage to federal workers of 22 percent. The government’s own data do not reflect the value of benefits.

“The salary council is following the procedure laid out in the statute. The issue is that nobody thinks that number has any credibility,” said James Sherk, the Heritage Foundation senior policy analyst who performed that study. “No president has recommenced a raise anywhere close to 30 percent across the board.”

“No one who takes a look at these numbers, other than federal employee unions, concludes that federal employees are massively underpaid,” he said. “Our research at Heritage, the academic research, no one who uses methodology other than what the salary council uses comes to that conclusion.”

Other studies using different methods and different sets of data have found federal employees ahead on average by varying amounts, with differences by education and other factors. The Government Accountability Office recently said that none of the approaches is definitive.

The salary council’s recommendations on the pay gap and technical issues involving defining the locality pay areas go to a higher-level body, which in turn reports to the White House.

President Obama has recommended paying a 0.5 percent increase in April after a temporary government funding measure expires. Although no general raise has been paid since 2010, individual employees remain eligible raises for performance, promotion or successfully completing the waiting periods used in some federal salary systems.

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