Why federal employees are not overpaid

Nov 16, 2011

The size and scope of the federal government and the money being paid to its workers is an issue on the presidential campaign trail. Republican candidates generally assert that the federal workforce is overpaid when compared with private sector employees. That notion continues to be the source of debate. The federal government recently reported that on average the gap has widened between the federal and private sectors -- with government employees falling further behind.

In a previous chat, James Sherk discussed the 2010 Heritage Foundation study that the GOP uses as its base for claiming that federal workers are overpaid, which he authored.

Chat with Colleen Kelley, the national president of The National Treasury Employees Union, Wednesday about why she thinks Sherk, and his study, are wrong.

Ask questions and submit your opinions about how much federal employees are paid.

Good morning. I have served as national president of the National Treasury Employees Union since August 1999. As NTEU represents 150,000 employees in 31 separate government agencies, I closely monitor federal salary issues, and I serve on the Federal Salary Council.

In my office, the pension federal employees receive is the envy of all - especially since our employer just terminated our pension plan. While their annual salaries may be less than that in the private sector, their total compensation is nothing to sneeze at. I know several people who retire from the feds when they are in their 50s, collect their 80% of their salary pension for life, and secure another job either as a fed contractor, a state employee, or a private sector employee. A pretty nice deal, if you can get it.

Of course NTEU does not support any employer terminating a pension plan but there is a lot of fiction out there about federal pensions so let me provide some facts.

The Federal Employees Retirement System (FERS) was established by Congress in 1983 and is today fully funded. Let me repeat: FERS has no unfunded liability.

The program’s design is a “three-legged stool” comprised of a small annuity, Social Security and a savings plan.  It provides modest, middle-class retirement security to its workers.  Yet, some in Congress are calling for the abolishment of the defined benefit portion of FERS.

The typical federal employee with a lifetime of service in the federal government will have an annuity from the defined benefit of approximately $1,000 per month.  The government’s 401(k)-like fund, the Thrift Savings Plan, may provide an annuity of around $400 per month if the average employee is able to fully contribute 5 percent of salary for 30 years.  Contrary to what some may claim, there are no federal employee millionaires.  Not even close

If the public realized that the majority of federal jobs are professional which require at minimum a college degree maybe the comparisons with Walmart and other retail jobs would cease. Our child is studying in a high tech field and highly sought out and well paid field but is considering the feds because friends are in the military and wants to support them.

I agree there are inappropriate comparisons that are too often made.

The fact is that federal employees are better educated than the private sector. Fifty-one percent of federal employees have college degrees, while 35 percent of private sector employees do. Additionally, 20 percent of federal employees have graduate degrees compared to 13 percent of private sector employees.

Has anyone ever actually given a reason for their assertion that public sector employees are overpaid? Where is the data to back that up? I am a lawyer, and I would be making about twice as much in the private sector for doing the exact same job. And no, I don't really work fewer hours, at least nowhere near enough to make up for the pay discrepancy. I work for the government because I want a mission behind my work (besides money).

In fact, the Bureau of Labor Statistics supports the view that especially highly skilled employees in the federal sector (like lawyers) are significantly underpaid compared to their private sector counterparts.  Other studies  that put forth different data are funded by idealogical groups pushing an agenda.

Unions over the year have indulged in featherbedding by demanding outrageous pension and retiree health benefits which are no long affordable. Why do you refuse to accept cutbacks in these benefits and pay your share of these expense instead of trying to pass them on to the rest of the public? Aren't you rather selfish?

Federal employees and their unions do NOT negotiate healthcare and retirement benefits.  And the FERS (federal employee retirement system) is fully funded.

Given the large deficits the question really shouldn't be about pay and benefits but the number of employees and their missions. We cannot afford the size of government we have now with the current revenue. Either we cut the number of employees or lower their costs. The problem is we get into this he said / she said about pay when that is not the underlying problem.

There are a number of steps that can and should be taken to address the current deficit situation.  Federal employees have already contributed $60 billion thru a 2 year pay freeze.  Congress should not cut the IRS' funding so taxes owed can be collected.  The IRS is responsible for collecting 93% of the revenue that funds the rest of the entire government.  People want clean air, and homeland security and the defense department and social security and school lunches and safe food, drugs and medical devices (and the list goes on and on).  In order to be able to do all that the country needs, we need to provide fair and appropriate ways to fund them.

Ms. Kelley, Why do you think that conservative think tanks and the GOP constantly attack federal employees? We're the ones who get the work done on behalf of all Americans.

I couldn't agree with you more.  Some groups don't want federal employees to be effective because it inhibits their political agenda.  Federal employees work very hard every day on behalf of our country and the agencies.  They deserve the respect and the thanks of the American public, not the unjust criticism from some.  NTEU is proud to represent federal employees.

My daughter, an attorney, left a prestigious law firm as a 5 year associate and went to the government, taking a 60% pay cut. Although she still makes good money by most standards, it's not what she had been getting. And the government does not give maternity leave--she had to use vacation and sick leave!

You make an excellent point on the maternity leave issue.  This is an area where the federal government is far behind the private sector and states, providing no paid parental leave.  None.  NTEU supports legislation to change that.

Thank you for your questions.  And I hope that the real facts about federal employee pay will result in public support for the talented and hard working men and women who do the work of our government every day.

In This Chat
Colleen Kelley
National President Colleen M. Kelley is the leader of the National Treasury Employees Union (NTEU), the nation?s largest independent federal sector union, representing 150,000 employees in 31 separate government agencies. As the union?s top elected official, she leads NTEU?s efforts to achieve the dignity and respect federal employees deserve. As spokesperson for the union, Kelley represents NTEU with the agencies, in the media, and testifies before Congress on issues of importance to union members and federal employees.
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