Pre-Boomer Musings

As a pre-boomer, I remember the days when “public servants,” as those in the public sector were referred to, made much less than those employed by businesses because there was less risk and more benefits for those working for the government.  It was up to the individual to decide what they wanted before starting off on a career path.  Times have certainly changed.

There’s no argument that top level positions and proven producers at corporations, large and small, have the potential to earn huge salaries, enormous bonuses, and substantial retirement plans.  In the public sector retirement plans for high-ranking individuals are substantial too, but bit nearly as big as corporate executives.  So what about the average worker, from middle-management down, how do those on the government payroll compare to private sector employees for salary, benefit and pension packages?

A random comparison of similar private and public jobs showed government worker wages were higher in 7 out of 10 instances.  The gap in salaries between the two sectors has remained about the same since 2002; however, the benefit differential is widening in favor of government workers. 

According to Bureau of Labor Statistics (BLS) findings, the average state and local government employee made $78,853 in wages and benefits in 2006.  This was $25,771 more than those employed by private business.  In 2000 the difference was only $7,604.  As recently as December 2008, benefits paid public employees hourly benefits increased to $13.38, while the private sector weighed in at $7.98 per hour in benefits. 

The BLS also reported that labor accounts for half of state and local spending, and benefits are about a third of these costs.  With pension funds suffering because stocks plummeted, the private sector employees took a hit while public workers knew their funds would be replenished through more taxes and greater fees, which come out of the pockets of all the other workers.  In other words, the so-called civil servants are not only biting the very hands that feed them, they are literally eating us alive by devouring more and more of the tax dollars to support the ballooning benefits they are receiving.

To make matters worse, government pensions have built-in cost of living increases and provide health care coverage for retirees as well.  These variables will continue to add to the budget problem, even if benefit packages do not increase, which is unlikely.  One final insult, government workers are often eligible for full-pension well before 65.  Rather than retiring with 80 or 90 percent of salary, many recycle themselves back into the workplace, which means they fill a job that another American may need. 

Don’t you think it’s time to stop this nonsense?  Powerful unions dictate wage and benefit package terms, and politicians pander to them.  Tell your elected representatives you want to see changes in the public sector so spending can be controlled.  Remember, your vote hires or fires the politicians.  Use it wisely.

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