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In the latest Tax and Budget Bulletin, Cato Director of Tax Policy Studies, Chris Edwards

explains how federal wages and benefits have outpaced private sector pay in recent years.

Chris, what did your study find?

Well, I found that the average compensation of federal workers has been soaring in recent years

and is now almost twice the average compensation in the private sector.

For example, the average federal worker earns about $100,000 a year currently

compared to just $52,000 for the average private sector worker.

Well, that's just total compensation.

How about wages?

Well, looking just at wages, the average federal worker

earns $67,000 a year now compared to just $42,000 in the private sector.

So the federal pay advantage has been rising much faster over the last few years than previously.

Has the federal pay advantage been growing as well?

If you go back to about 1990,

federal workers earned only about 50% more than average private sector workers. Today they earn 93% more than

workers in the private sector. So the federal workforce is becoming an elite island of secure

and very high paid workers when in the private sector

workers have to compete in the dynamic global economy.

Well how exactly did this happen that federal pay outpaced private sector pay?

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