City Government

Government Workers Should Share Wage Cuts

Lots of recent talk from politicos about public employee compensation. I appreciate their concern and efforts to preserve this group’s compensation but a historical context is worthy of examination.

In recent years elected leaders have worked to ensure “compensation parity” with the private sector for public servants. This misguided effort ignores the very premise of public service as a career choice.

Historically, public servants have been employed at a lower pay rate/salary than similarly skilled private sector employees–blue collar or white, knowing that a more secure pension awaits at retirement. Also, retirement eligibility for the public servant is often at an earlier age, yet another perk in exchange for a lower pre-retirement wage/salary. A Wall Street Journal report notes as early as the 1920’s government began the process of defining lower wages for better retirement.

“The primary reasoning for the government’s incremental increase in generous civilian work force retirement programs was a rationale fueled by the theory that government workers, by working for the government, were not able to command the same high salary and wages that their counterparts in the civilian sector would be able to command. Thus, generous pensions became a balancing compensation package justified by supposed lower earnings during the prime productive years.”

Today, logic dictates that either public servant wages/salaries decrease to maintain the balance or the retirement benefits decrease to offset new higher wages. Either way a decrease in overall compensation is needed in these tough economic times. Some would argue its “unfair,” but if public service wages and benefits are tied to private employment rates, there can be no logical argument to keep public compensation packages higher than the private sector.

In the April 10-12 Weekend edition of the USA Today, Dennis Cauchon, reports, “The pay gap between government workers and lower-compensated private employees is growing as public employees enjoy sizable benefit growth in a distressed economy” As validated by the Bureau of Labor Statistics, “….total compensation for state and local workers was $39.25 an hour — $11.90 more than private business.” Almost $12.00/hour more than the private sector; 30% more on average. Also reported,“Last year government benefits rose .69 cents an hour versus .23 cents in the private sector. Labor costs account for about half of state and local spending, according to BLS and Census data.”

In the current legislative session, Idaho’s legislators started with an across the board 5% payroll cut for public employees but wound up at 3% with the JFAC siphoning $7.4 Million in stimulus money to cover some of the 3%! In a nutshell this means they did not adequately address the issue, in terms of scope, depth or length and next year we face the same issues without the stimulus money to cover our lack of determination. Governor Otter wanted 5% cuts and he was right to call for it.

Public service was never intended to be financially rewarding. It is supposed to appeal to the concept of “service to others” as a service organization responsible to the general public. Not the other way around.

Citizens determine their destiny and ultimately how they want their tax dollars spent—despite efforts of local government to deny them the right to approve debt. I believe in fair compensation but to think a public servant is better off in life, from an economic standpoint, at the expense of the citizens they serve is bewildering.

Illinois State Senator Chris Lauzen has it right when he says “…government benefits are unsustainable and unfair to taxpayers who earn less than civil servants. People will become angrier and angrier when they learn the difference between their pay and benefits and what we give to public employees.” Idaho politicos seem to miss this point.

Comments & Discussion

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  1. Average Reader
    Apr 13, 2009, 8:36 pm

    Taxpayers subsidize development corporations, foot the bill for failed banks, and pay football programs millions of dollars every year. But you choose to pick on the public servant – they are over paid? I thought you watched out for the little guy, shame on you. I know many state workers that make under $30K/yr who are taking this same cut. How does that compare to your net salary reduction this year? Does kicking sand in the face of the weaker man on the beach make you feel like a big boy?

  2. Dear Average Reader,
    Not at all, I do look out for ALL of us. I have a great deal of compassion for each person affected by this mess created by greed and criminal behavior. I speak from the heart and from personal experiences. Just so you know I took a 39% pay cut in 2003 and lost my entire pension. I have had a 1% increase to my salary since then. I know what it is like to lose a great deal. Not to mention that I lived the majority of my childhood life watching my mother struggle in a single parent home on food stamps trying to make it paycheck to paycheck. I am not trying to “pick” on anyone, I am offering a historical perspective that we have lost sight of. We ALL need to sacrifice to get through this economic mess. Once it passes, we can readdress the issues. There is no malice in my motivation to face full on this economic reality.

  3. Mr. Edgar, You are ill advised to use a national statistic to make a point about Idaho. I have worked in State and County government in both California and Idaho and I can tell you firsthand that little of what is said in this article apply’s to Idaho. California is another story, we were all paid more than we were worth. There are a large number of Idaho State employees that qualify for public assistance…are you kidding me? A big part of the government job promise has historically been job security, there is little job securty in Idaho government jobs, most are at-will positions. Show me where a government worker in Idaho is making above private sector wages…I don’t believe it!

  4. Not to worry, most state employees are below market value despite small increases in recent years, which were preceded by two or three years of no change in salary.

  5. Being a public employee with ten years of sevice and two advanced degrees while still qualifying for food stamps makes me wonder about your facts. Before you start tossing out statistics maybe you should look a little deeper. No doubt the data is skewed signficantly by Coach Pete and a few others. Also our so called secure employment evaporated when we were all made at will employees two years ago.

  6. This guest opinion is very childish and serves as a testament to your ignorance. Did we forget the Tortoise and the Hare, it’s one of Aesop’s Fables…

    Once upon a time there was a hare who, boasting how he could run faster than anyone else, was forever teasing tortoise for its slowness. Then one day, the irate tortoise answered back: “Who do you think you are? There’s no denying you’re swift, but even you can be beaten!” The hare squealed with laughter.

    “Beaten in a race? By whom? Not you, surely! I bet there’s nobody in the world that can win against me, I’m so speedy. Now, why don’t you try?”

    Annoyed by such bragging, the tortoise accepted the challenge. A course was planned, and the next day at dawn they stood at the starting line. The hare yawned sleepily as the meek tortoise trudged slowly off. When the hare saw how painfully slow his rival was, he decided, half asleep on his feet, to have a quick nap. “Take your time!” he said. “I’ll have forty winks and catch up with you in a minute.”

    The hare woke with a start from a fitful sleep and gazed round, looking for the tortoise. But the creature was only a short distance away, having barely covered a third of the course. Breathing a sigh of relief, the hare decided he might as well have breakfast too, and off he went to munch some cabbages he had noticed in a nearby field. But the heavy meal and the hot sun made his eyelids droop. With a careless glance at the tortoise, now halfway along the course, he decided to have another snooze before flashing past the winning post. And smiling at the thought of the look on the tortoise’s face when it saw the hare speed by, he fell fast asleep and was soon snoring happily. The sun started to sink, below the horizon, and the tortoise, who had been plodding towards the winning post since morning, was scarcely a yard from the finish. At that very point, the hare woke with a jolt. He could see the tortoise a speck in the distance and away he dashed. He leapt and bounded at a great rate, his tongue lolling, and gasping for breath. Just a little more and he’d be first at the finish. But the hare’s last leap was just too late, for the tortoise had beaten him to the winning post. Poor hare! Tired and in disgrace, he slumped down beside the tortoise who was silently smiling at him.

    “Slowly does it every time!” he said.

  7. Frankly I think this moronic guest opinion is really weak. G-man, can’t you get sombody interesting with factual information like from the Tea Party gang or a representative from the KKK?
    Bill Sali would be good.
    Where did you find Mr. Edgar anyway? I know this guy who might be ineresting for a guest opinion. His premis for the obesity problem in the US is that Americans are just more hungry than the rest of the world. He’s got some really good statistics.

  8. Wow! It took a long time for those sucking at the “government teat” to declare, “ya’ll can take the hit in these hard times, but WE ain’t giving up NOTHING, and ya’ll should be ashamed for suggesting it!” No one held a gun to your collective heads to force you into government service. Why, during these really tough times, do you feel so “empowered” with your chosen professions that you should be treated as immune with regard to your income?
    So, take the cuts, join with the rest of us and quit your bitchin!

  9. Come on Guardian…. Don’t let Mr. Edgar post again. Please tell us you don’t agree with this guy.

    EDITOR NOTE-Rob, agree or disagree, we try to offer a forum. If we ban Mr. Edgar for his view you will be left with my same old rap of “let the people vote” as I sow the seeds of “negative thoughts.” You are sure welcome to step up to the keyboard yourself.

  10. Interesting that the Idaho House is made up primarily of agribusiness folks. I bet they’d scream like stuck pigs if you took any bit of “socialist” (farm subsidy) welfare that gets doled out to them by the feds every year. Talk about guvmint hind teat weaner pigs, they take the State Fair prize.

  11. The reason for the high average compensation levels for government workers is that there has been an effective hiring freeze on state and federal workers for almost 20 years, due to the policy of contracting out most government functions. State and federal agencies are all top-heavy with older workers . . . lots of chiefs due to retire in the next 10 years, and no indians at the bottom with on-the-job experience to fill those slots. So, despite being paid on average 15-20 percent less than their ‘average’ private sector counterparts, the wage/compensation bill for civil servants appears high. But don’t worry, in less than 10 years, almost all those workers will be retired, along with most of the school teachers, and you will have no one working for government who has a clue what they are doing because they will all be brand new, cheap, inexperienced employees.

  12. Dean Gunderson
    Apr 21, 2009, 1:34 am

    Having worked with Mr. Edgar in the past, and knowing that he’s a beneficiary of a military retirement himself, I’m surprised (as are others) at his use of non-transferable national statistics to the situation in Idaho.

    The per capita rate of Idaho public employees to the overall Idaho population has steadily declined since the 1970 Census — and in real dollars, those same public employees’ earnings have slipped behind private sector wages. And, though the Public Employee Retirement System of Idaho has wonderfully protected its resources (something that all Idahoans should be proud of), the sad reality is that few public employees will ever gain full access to their investments and must supplement their “pensions” with Individual Retirement Accounts.

    Mr. Edgar’s use of the term “pension” is even a misnomer, since no public employee pension system truly exists in Idaho for all public employees. There is no collective bargaining system for Idaho’s public servants, and for most such employees no “classified” system to offer the kinds of protections that would make a full enjoyment of a PERSI “rule of 90” retirement a guaranteed thing.

    You can argue about whether this is a good thing or not, but you can’t say that an At-Will employee has a pension system. At best, you can offer that they have access to a retirement fund that their employer contributes to (just as they do from their own earnings). These employees may have access to their full funds when they become vested, and may enjoy the full benefits of the fund IF the employer doesn’t choose to let them go (which they can do, for no cause).

    I’ve worked for both the private and public sectors, and while the financial rewards are certainly greater in the for-profit world — public service was a conscious choice of mine, and not one I chose because I thought it offered more “protections” (either in employment or retirement). I’ve never encountered a public servant who thought their work days were no more than count-downs to retirement as Mr. Edgar implies.

    But, then again, I worked with Mr. Edgar — and perhaps he thought his 20-some years as an Air Force pilot were just marking time until he could leverage that incredibly expensive training into a post-military job as an airplane pilot.

    But then again, I don’t think so.

    Which is why it’s so perplexing that he is characterizing other public servants’ motivations as retirement-centric and self-serving — when they simply voice concern over the very real threat of a complete loss of work (not a 5% trim in salary).

    If Mr. Edgar could point to an Idaho public agency that hasn’t let staff go due to the downturn in the economy (that is, trimmed its total HR compensation package), or one that has increase both its per capita employment rate, and increased its individual compensation package, while at the same time increasing the number of its employees that go on to enjoy full rule-of-90 retirement benefits — we should all be willing to listen to his concerns.

    But, I can save him all the time he would spend scrounging the editorials of the prestigious USA Today newspaper, and that bastion of all things Idaho, the Wall Street Journal — and tell him now, there isn’t one.

    The governor wasn’t asking for an across the board cut in compensation for public employees because he thought the employees will make it up in the end (via their retirement funds). No, the 5% reduction would be created through forced terminations and attrition. The legislature spent more time looking into the issue and found that “only” a 3% reduction could be created though this process, and it needed to “borrow” stimulus money to even make that happen.

    Please note, this doesn’t constitute a belt-tightening — keeping everyone on-board while they work for less — it simply means that Idaho taxpayers will get even less public services for their tax dollar, as the halls of public institutions are further depleted of staff.

    It’s truly a sad state of affairs when the affairs of state succumb to partisan rhetoric. (you can quote me).

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