Public-sector workers

New Jersey public-sector employees not overpaid, EPI study finds

For Immediate Release: Friday, July 30, 2010
Contact: Phoebe Silag or Karen Conner, 202-775-8810

A new Economic Policy Institute study finds that there is no significant difference between the wages of employees in the public and private sectors in New Jersey when measured on a per hour basis.  On an annual basis, public employees in New Jersey are underpaid by 4.05%.  The study’s findings directly counter the New Jersey Star-Ledger’s position that the state’s public employees are overcompensated.

The analysis, Are New Jersey Public Employees Overpaid? by Labor and Employment Relations Professor Jeffrey Keefe of Rutgers University, compares the incomes of public and private sector employees, controlling for education, experience, hours of work, organizational size, gender, race, ethnicity and disability.

In light of the severe financial problems states are facing due to the economic downturn, state, county and municipal elected officials across the country have had to make massive cuts in spending.  As a result, tens of thousands of public sector employees have been laid off and thousands more have been subject to forced furloughs, pay freezes and cuts in benefits.  Attempts to condemn public employees and the unions that represent them have been an unfortunate side effect of the budget crunch in New Jersey and in other states.  However, as Are New Jersey Public Employees Overpaid? makes clear, public employees—like many American workers—have in fact been victims of the worst recession of the past 70 years.

See related work on Public-sector workers