Public employees have it good in Wisconsin, but not necessarily as good as critics think.
Begin with the fact that the state is relatively parsimonious when it comes to hiring. Wisconsin ranks 4lst in the nation in per capita public employment, according to the Wisconsin Taxpayers Alliance. In 2008, the state's public sector was 8.2% smaller than the national average. The average salary for a state employee was $53,703 in 2008, 4.3% higher than the national average.
Another study, by the Center for State & Local Government Excellence, undercuts the common assumption that public employees are paid better than private-sector workers. The study by two UW-Milwaukee economists found that public jobs require more education than private jobs, resulting in 48% of public workers holding college degrees compared to only 23% in the private sector.
So while overall average salaries may be higher on the government side, when the job comparisons are controlled for education requirements and experience, state workers typically earn 11% less than their private-sector counterparts.
Only with lower-skilled blue-collar jobs did UWM researchers Keith Bender and John Heywood find that public employees make more money. At the while-collar professional level, the business world paid better.
Benefits and retirement are another story.
Public employees enjoy defined-benefit pensions, meaning that retirees receive a set amount each month. Such retirement plans have almost entirely disappeared from the private sector, where employees typically receive defined contributions that they themselves invest (for better or for worse) for their retirement years. You can guess which plan offers more security.
Moreover, public employees typically pay nothing toward their retirement plan - a situation produced by years of crafty union bargaining. And they've largely avoided the high premiums, deductibles and copays attached to health coverage for private employees.
The cost to the taxpayers is substantial. The Milwaukee Journal Sentinel recently reported that the Milwaukee school district spends as much as $26,846 a year on family health coverage for a teacher, significantly higher than the almost $20,000 a year the state pays for its Milwaukee employees.
Health insurance and pension contributions will assuredly be a battleground issue for the new governor and public employee unions in 2011.
