Study: private workers earn more than public

Public-sector workers in New Hampshire and the rest of New England earn less on average than private-sector employees, according to a study out of the University of Massachusetts at Amherst. Associate research professor Jeffrey Thompson and John Schmitt of the Center for Economic and Policy Research at UMass studied the wage discrepancy between public and private sector workers in New England. It found that, on average, state and local government workers do earn higher wages than private-sector workers because they are older and substantially better educated. But it also found that when those same public employees are compared to private-sector workers with similar backgrounds – particularly age and education – those in the private sector earn nearly 3 percent more on average. The numbers for New Hampshire echo the New England findings. The weekly earnings of a New Hampshire public employee with a bachelor’s degree in 2009 averaged $886, compared with $1,141 for a private-sector worker with the same degree. The wage discrepancy between public- and private-sector workers is smallest among high school dropouts (earnings averaged about $380 per week in 2009 in both the public and private sector) and largest among workers with advanced academic degrees (private workers averaged $1,425 per week versus $1,018 per week for public workers). On average, state and local employees receive higher non-wage benefits than private-sector workers. But, “even after taking benefits into account, state and local government workers in New England continue to face a penalty in total compensation,” the study says.It adds: “The depiction of public sector workers as ‘overpaid’ ignores that state and local government workers have much higher levels of formal education and are older (and therefore generally more experienced) than workers in the private sector,” according to the report. — KATHLEEN CALLAHAN/NEW HAMPSHIRE BUSINESS REVIEW