Brookings Institution

*Public Employees, Unions and Fiscal Austerity* [15 March 2011]

Gary Burtless, Senior Fellow, Economic Studies

http://www.brookings.edu/opinions/2011/0315_public_unions_burtless.aspx

or

http://www.brookings.edu/opinions/2011/0315_public_unions_burtless.aspx?p=1

[excerpt]

March 15, 2011 —

With Wisconsin Governor Scott Walker leading the charge, some states are looking for ways to scale back worker pay and curb the collective bargaining rights of public employees. Public sector compensation may be seen as a good place to cut government spending, especially by GOP governors in states where public-employee unions have historically been major contributors to the Democratic party.

I see no strong case for believing that public employees are generally overpaid, if by "overpaid" we mean they receive better compensation than private-sector workers who do the same thing. On average public employees receive better health and retirement benefits than their private-sector counterparts, but they often earn lower money wages than private workers who perform similar jobs. At the bottom of the skill distribution, government employees receive better total compensation, but at the top of the distribution, they typically receive lower compensation than similar private-sector workers.

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