On the November 30 edition of Fox & Friends, Fox Business' Charles Payne pushed the claim that federal worker compensation is about twice that of private sector workers. In fact, that claim is based on a discredited apples-to-oranges comparison.
Payne pushes claim that federal workers earn nearly twice as much as private sector workers
Payne: "The average federal worker makes 123,000 versus 69,000" for private sector workers. Arguing in favor of the proposed federal pay freeze on the November 30 edition of Fox News' Fox & Friends, Fox Business contributor Charles Payne stated, "The average federal worker makes 123,000 versus 69,000" for private sector workers. Payne called this "mindboggling stuff."
Claim that federal workers make twice as much as private workers is based on false comparison
Payne's claim about federal pay echoes misleading USA Today analysis. Payne's claim echoes an August USA Today article which used data from the Bureau of Economic Analysis to report that "[f]ederal civil servants earned average pay and benefits of $123,049 in 2009 while private workers made $61,051 in total compensation." Right-wing media seized on that report to criticize federal workers.
PolitiFact: Simply comparing federal employees' compensation with private sector compensation "is not an apples-to-apples comparison." From a February 3 PolitiFact article rebutting the claim that "federal employees are making twice as much as their private counterparts":
[I]t's important to understand that a big reason for the disparity is the different mix of jobs in the federal work force. It has more higher-paying white-collar jobs, experts told us, while there are more lower-paying, blue-collar jobs in the private sector that bring the average down. So it is not an apples-to-apples comparison.[PolitiFact, 02/03/10]
USA Today article acknowledges that its "analysis did not consider differences in experience and education." The USA Today analysis compared the average pay and compensation for all federal employees to that of all private employees. The analysis did not attempt to determine if a private sector worker earns more or less than a federal worker with a similar job. USA Today noted that its analysis of private and federal pay "did not consider differences in experience and education."
The average federal salary has grown 33% faster than inflation since 2000. USA TODAY reported in March that the federal government pays an average of 20% more than private firms for comparable occupations. The analysis did not consider differences in experience and education. [USA Today, 08/13/10]
Bureau of Economic Analysis: "Skill levels and educational attainment tend to be higher" for federal workers. An August 18 PolitiFact article on federal pay reported that the Bureau of Economic Analysis -- the source for USA Today's data -- said that the numbers used by USA Today "do not tell the complete story," in part because in recent years, "the federal government is hiring more highly skilled workers who tend to make more money." From the PolitiFact article:
The BEA notes that its private-sector data includes employees of all professions. That means everything from minimum-wage jobs to the salaries of chief executive officers. Federal employees typically work in professional occupations that pay more, such as accountants, attorneys and economists, according to Congressional Budget Office research.
The BEA also noted in recent years that the federal government is hiring more highly skilled workers who tend to make more money. Many of the lower-paid positions, the BEA found, have been contracted out to the private sector. [PolitiFact Georgia, 08/18/10]
Indeed, the BEA website lists "a number of factors that explain why average compensation for federal government non-postal civilian employees is higher than average compensation for private-sector employees":
The mix of occupations held by federal government civilian employees is different from that of occupations held by the entire private-sector workforce. The private-sector workforce are in a wider range of jobs than federal government employees -- from minimum-wage positions to highly paid CEOs. According to studies conducted by the Congressional Budget Office (CBO), jobs in the federal government civilian workforce are concentrated in professional (e.g., lawyers, accountants, and economists), administrative, and technical occupations. In addition, skill levels and educational attainment tend to be higher, on average, for federal government civilian employees than for private-sector employees because of the occupational requirements in the federal government.
Over the past several years, there has been a shift in federal employment toward higher-skilled, higher-paid positions because lower-skilled (and lower-paid) positions have been contracted out to private industries. This trend has contributed to higher average pay for federal government civilian employees than for private-sector employees.
On average, federal government employees receive higher benefits in the form of pensions and health insurance contributions than private-sector employees; some private-sector employees receive no benefits.
Moreover, federal compensation estimates include sizable payments for unfunded liabilities that distort comparisons with private-sector compensation. For 2006, for example, the value of these payments for unfunded liability was $28.6 billion or 10.7 percent of total federal civilian compensation. [Bureau of Economic Analysis, accessed 12/01/10]
Washington Post: "[G]overnment sets pay scales based on what private employers in different regions pay for comparable levels of work and experience." A September 25 Washington Post article reported: "Because the government workforce is more skilled on the whole than labor used by private companies that include McDonald's and Wal-Mart, comparing all jobs skews private-sector salaries down, government officials say. The government sets pay scales based on what private employers in different regions pay for comparable levels of work and experience." From the Post article:
So are federal employees overpaid? It depends on who's measuring. Democrats say a public-private pay gap exists, but in the other direction: The government lags behind the private sector by 22 percent.
"If the American public knew the data that was the basis for these outrageous claims," said John Berry, the government's personnel chief, "they'd see how ideologically biased it is." With four out of five hires under Obama to defense and homeland security jobs and the Department of Veterans Affairs, "I'd ask, which one of those people would you like to fire?"
Critics cite data that compare all public and private jobs: Federal workers averaged $123,049 in pay and benefits last year, while private workers totaled $61,051.
Because the government workforce is more skilled on the whole than labor used by private companies that include McDonald's and Wal-Mart, comparing all jobs skews private-sector salaries down, government officials say. The government sets pay scales based on what private employers in different regions pay for comparable levels of work and experience.
A government lawyer generally earns less than a corporate one. When the same work levels are compared, private pay comes out ahead 22 percent, government officials say.
Data released by Berry's office do not offer a government average. But the figures show that a novice government nurse earns $46,148, more than a private one at $39,215. More experienced government nurses trail behind the private sector - $84,652 compared with $124,239. [The Washington Post, 09/25/10]
Fox has previously pushed faulty comparison
Parroting Rand Paul, Fox claimed "federal workers' average compensation is over twice that of non-government workers." During the November 8 edition of Fox News' America Live, host Megyn Kelly aired a clip of Rand Paul stating, "The average federal employee makes $120,000 a year. The average private employee makes $60,000 a year." Moments later, Kelly said, "Our brain room pulled out some of these statistics ... Federal workers made an average pay, benefits of approximately 123,000 back in 2009. And federal workers' average compensation is over twice that of non-government workers."