Warped accounting standards aren’t helping the public pension crisis, but it is also not the only source of the problem. Another factor contributing to the pension crisis is total compensation paid to state employees.
A new report from Citizens Against Government Waste found that, on average, state governments pay 6.2% more per hour in wages and benefits than their private sector counterparts in 22 occupations. That report found that state compensation as a whole was greater than in the private sector across all of the states, while the largest disparity within an individual field was $61 per hour.
Texas and California had the largest disparity between public and private compensation. In 15 of the 22 occupations, the state of Texas offered greater compensation than the private sector. All told, the state paid $14 per hour greater than the private sector driven by huge gaps in the Business and Finance Operations, Healthcare Support, and Education, Training, and Library occupations.
In the 13 occupations in California where state employees earned more than they would in the private sector, state employees earned a weighted average of $43.10 per hour, while private workers earned $30.65 per hour.
Utah and Montana were most in line with private sector levels of compensation. Utah paid state employees an average of $3.96 per hour more, while Montana paid state employees an average of $4.09 per hour more.
The findings come from that 50-state data provided by the National Compensation Survey and Bureau of Labor Statistics (BLS). The lack of publically available BLS data, though, has frequently stood in the way of garnering a comprehensive view of public versus private sector compensation. To work around this problem, researchers created a system of 22 equations with over 3,500 variables to estimate public employee compensation.
The full report, available here, contains state level information and a more detailed review of the methodology employed. It offers further evidence that while so many in the private sector have suffered through an economic downturn, state governments have protected public employees and instead chosen to further endanger budgets and public pension systems.