Left Still In Denial About Federal Worker Pay

Jason Richwine / December 01, 2010

Lawrence Mishel, president of the Economic Policy Institute (EPI), does not like President Obama’s call for a two-year pay freeze.  He writes:

[The freeze]…will only enlarge the degree to which federal pay lags that of the private sector (a gap of 22%, according to the federal pay agent’s report. See Table 4.) ….and in the process [it] reinforces conservative myths, in this case the myth that federal workers are overpaid.

This statement is not merely false, but also intellectually inconsistent.  First the “false” part: Labor economists  have been documenting a federal pay premium for decades.  After controlling for a large set of worker characteristics—age, education, experience, race, gender, etc.—federal workers earn more in wages than comparable private sector workers.  This is not a partisan claim, much less a “myth”—it’s a factual summary of the academic literature. (more…)