Do California public employees earn more than workers in the private sector? With a large budget deficit and cuts in services due to cash-strapped local governments, public employees have not escaped being a focus of critics who have blamed the salaries and pensions of those in the public sector as the primary culprits for poor economic circumstances. However, according to a new study by economists at UC Berkeley and Rutgers University, public workers earn 7 percent less on average than their counterparts in the private sector. Notably, once benefits are factored in, the pay is roughly comparable between the two. Consequently, researchers described the results by saying it was “basically a wash” when comparing public vs. private. The compensation of 5,000 workers were examined to conduct the salary, and while overall compensation was similar, the researchers noted that “55 percent of public employees in the state have a college degree, compared with just 35 percent of California's private sector workers.” In the introduction of the report, entitled “The Truth about Public Employees in California: They are Neither Overpaid nor Overcompensated," the authors write:
“In California government workers have been vilified as scandals and anecdotes pass as confirming evidence of exorbitant pay. This research is especially important given the outrage over the pay of municipal officials in Bell, California. […] The research in this paper investigates empirically whether California public employees are overpaid at the expense of California taxpayers. The results from this analysis indicate that California public employees, both state and local, are not overpaid. The wages received by California public employees are about 7% lower, on average, than wages received by comparable private sector workers; however, public employees do receive more generous benefits.”
The study found that the greatest differential in pay was for professional employees, lawyers and doctors. The report also notes that there are 60,000 fewer government workers at the state and local level currently than there were before the economy turned for the worst. The Bee’s Jon Ortiz cautions that “Then there's the nature of numbers. Like foreign languages and Picasso paintings, statistics require interpretation. […] Both sides of the debate will latch on to the report that suits their agenda. It's one thing politics and math share: predictability.” You can read the full report here.