How state workers' pay really stacks up

As the state confronts its $2.7 billion budget shortfall, some critics say generous pay and benefits for state workers are part of the problem.

"There used to be a time when there was a trade-off for being a state worker," said Erin Shannon, spokeswoman for the Building Industry Association of Washington (BIAW), a trade group that supports Republican candidates and causes. "You probably weren't going to get rich, but you had job security, you were going to have a pretty decent pension, health insurance and some paid time off.

"Now we're in a situation where you get all of those things, and you make more than your private-sector counterpart."

State employees do receive benefits that are richer than those earned by many other workers. But an analysis of statewide wage data by The Seattle Times shows that claims about state workers earning higher pay than others are in many cases incorrect or oversimplified.

Out of nearly 200 standard occupational categories analyzed by The Times, representing most of the 149,000 or so state employees, median pay last year was higher for state workers than for all other workers in only 74 categories. (Median means half earn more, half less.)

The Times did not compare state health-care plans and pensions to the private sector. Such benefits are a major part of total state employee compensation — about 30 percent, on average — but are difficult to put present-day dollar values on and even harder to compare across different employers and job categories.

The Evergreen Freedom Foundation, a conservative think tank, cites data from the federal Bureau of Economic Analysis (BEA) to make the argument that government workers are better paid than private-sector workers.

According to the BEA data, Washington state employees earned an average $54,079 in 2007, versus $49,777 for the average private-sector worker. Those figures include employer contributions to retirement plans, health insurance, Social Security and the like, as well as wage and salary income.

However, such analyses don't tell the whole story because the government and private-sector work forces are composed very differently. Washington state's payroll, for instance, includes relatively more high-earning occupations, such as educators and finance specialists, and relatively fewer low-earning occupations, such as wait staff and retail clerks.

GOP lawmakers would not get drawn into the debate over state-worker pay. "I don't know," state Sen. Joe Zarelli, the ranking Republican on the Senate Ways and Means Committee, said when asked if he thought state workers are compensated better than private-sector workers.

Regardless, Zarelli said, the Legislature needs to reduce spending, and state workers need to be part of that. "Right now, our issue isn't about competitive pay, it's about balancing the budget and everybody sharing in that process," he said.

Shannon, the BIAW spokeswoman, said her organization wants lawmakers to look at all state-employee compensation.

"They have an outstanding pension, a Cadillac health-insurance benefit for very, very low cost, and very competitive salaries. So am I going to say they should look only at salaries? No," Shannon said. "If they think they want to keep salaries but really start trimming the benefits side ... then OK. But we want them to look at everything."

Payroll differences

With the assistance of the state Employment Security Department, The Times examined wage data for nearly 200 distinct occupational groups — those in which direct comparisons between state workers and others were possible.

The analysis shows the state's payroll looks very different from that of the overall labor force.

For instance, food preparers and servers — a relatively low-paid group — make up 9 percent of nonstate workers but just 1 percent of state employees.

And people working in business and financial operations — a relatively high-paid group — comprise 10.2 percent of state workers but just 4.5 percent of all other workers.

Overall, lower-wage state workers tended to earn more than their nonstate counterparts, while higher-paid professionals made more in the nonstate sector.

The median wage for the 2,000 janitors working for the state last year was $13.44 an hour, or $27,955 a year. Their 37,100 nonstate counterparts earned about 6 percent less.

The opposite was true for the state's 1,200 computer-systems analysts. Their median wage last year was $31.47, or $65,463 a year — nothing to sneeze at, but 22 percent below the median for nonstate systems analysts.

This pattern didn't surprise Rick Kearney, director of the School of Public and International Affairs at North Carolina State University, who has written extensively about the factors that determine state-employee compensation.

"In general, private-sector pay is higher than in the public sector, and the higher up the occupational hierarchy the job is, the greater the pay advantage for the private sector," Kearney said.

At lower-level jobs, he said, unionization among government workers operates to raise pay levels, but that advantage dissipates the higher up the job hierarchy one goes, he said.

When looking at wages for entry-level workers compared with experienced employees, The Times analysis found that rookies working for the state often got better starting salaries than nonstate workers.

Out of 199 occupational categories, 111 had higher median wages among entry-level state employees than nonstate employees; in just 88 was the nonstate entry-level median higher.

But among experienced workers, the situation reversed: In just 55 categories was the state median higher than the nonstate, while in 143 the nonstate median was higher. In one job category, locksmiths and safe repairers, the state and nonstate medians for experienced workers were separated by just one penny.

Changes proposed

Historically, Kearney said, states and localities typically offered fairly generous benefits packages — a more or less tacit trade-off for lower government salaries.

"This was the way you got people into government work — give them a secure job and a pension," he said.

But with the recession slashing tax revenues and opening huge holes in state and local government budgets, Kearney said, that "benefits advantage" is diminishing; he expects it to disappear within a few years.

In Olympia, state lawmakers have proposed several ways to reduce the size and cost of the state work force, including privatizing state liquor stores and the printing shop.

So far, the measures have not gone very far.

"The concern I hear is, people losing good-paying jobs," said House Majority Leader Lynn Kessler, D-Hoquiam.

A bill originally aimed at furloughing state workers one day a month for 16 months also has run into trouble. It's been amended and now would require state agencies to furlough workers for 11 days during the year or create other plans to save $50 million.

Most state employees, though, have been exempted. It's not clear if the measure will survive.

For their part, state workers' unions say they've already taken enough hits.

Last year, the Legislature suspended cost-of-living increases for public employees, though around 20,000 are projected to get "step increases" in the current two-year budget, which runs through June 2011.

Beginning last year, lawmakers also required state workers to pay higher co-pays and deductibles for their health insurance.

And budget cuts last year have shrunk the state work force. Figures provided by the governor's office show employment, excluding K-12 teachers, has dropped about 4 percent during the past fiscal year.

Drew DeSilver: 206-464-3145 or ddesilver@seattletimes.com

Andrew Garber: 360-236-8268 or agarber@seattletimes.com

National expert on state-employee compensation