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Facts are Hazy on Public Employee Pay

March 2, 2011 By John Gramlich

USA Today raised eyebrows this week when it reported an explosive claim: public employees in 41 states, the paper said, earn more in total compensation than their private-sector counterparts. The analysis drew on data from the federal Bureau of Economic Analysis and took into account combined wages and benefits for public workers versus those in the private sector.

But the paper's conclusion differs markedly from the one reached last week by The New York Times, which found wide variation in public employee pay based on the state, occupation and educational background of the worker. In general, The Times found that college-educated employees earn less in the public sector than they do in the private sector while those without a college education do better on the public workforce.

Both the USA Today and New York Times analyses have limitations. The Times acknowledged that it used Census data that "do not include information on pensions and other benefits, which is crucial for a fuller comparison because public sector workers typically receive more in benefits than workers in the private sector do." USA Today acknowledged that its report "did not adjust for specific jobs, age, education or experience," making overall sector-to-sector comparisons instead.

Reactions to the USA Today story, in particular, underscore the contentious nature of the debate over public employee compensation — and how difficult it is to pin down with any certainty.

Dustin Gawrylow, executive director of the North Dakota Taxpayers Association, issued a statement hailing the report as credible, according to the Fargo Forum. "For decades, we have been told that public employee pay is embarrassingly less than in the market," he said, arguing that the USA Today shows that isn't the case. But Ken Purdy, compensation manager for North Dakota’s Human Resource Management Services, told the North Dakota paper that the report is “a gross oversimplification of the issues in working with employee compensation."

Article reprint courtesy of stateline.org, a nonpartisan, nonprofit news service of the Pew Center on the States that reports and analyzes trends in state policy.

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