State Workers: Overpaid, Underpaid, Or Just Right?

Citizens Against Government Waste

Public and private workers in New Hampshire are among the most evenly compensated, finds a new report from the right-leaning Citizens Against Government Waste (CAGW). Still, the report shows, the New Hampshire’s public sector pays on average, $4.51 more, per hour, than the private sector. The report states that “State governments pay on average 6.2 percent more per hour in wages and benefits, including pension benefits, than the private sector for the 22 major occupational categories that exist in both sectors.”

CAGW ranked Texas and California as states with the largest differences in compensation, favoring public workers, while Utah and Montana boasted the least disparity.

However, two years ago, the liberal-leaning Economic Policy Institute published research arguing exactly the opposite. It argues that public sector workers earn between 11 and 12 percent less than private sector workers.

Why are their numbers different?

The Economic Policy Institute says “claims that state and local workers make exorbitant wages and compensation almost always fail to consider the occupation or education levels of the workers being compared. Studies which make an apple-to-apple comparison (controlling for education and other worker characteristics) show that state and local workers are not overpaid.”

It’s interesting to note that the Economic Policy Institute’s data show that the Public sector pays more than the private sector for employees with up to an Associate’s degree in educational attainment. For those with a bachelor’s degree or more education, the private sector pays more.


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