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Independent research tells a different story about federal pay.

Federal employees are still smarting over President Obama's two-year pay freeze, but for some Republicans a mere freeze is not enough. House Speaker John Boehner, R-Ohio, promises to eliminate tens of billions of dollars from the budget, and federal workers will not be immune.

Meanwhile, the Office of Personnel Management argues that feds actually deserve a raise, not a pay reduction. OPM's 2010 annual report says federal employees earn less than their private sector counterparts, noting the pay gap grew from 22 percent in 2009 to 24 percent in 2010. This is surprising, given that federal employees received a 2 percent pay increase from 2009 to 2010 while economywide wages fell by 1.5 percent during that period. Nevertheless, public sector unions cite this data to dismiss claims of federal overcompensation.

Is the overpaid federal worker really just a myth? Not according to academic research. Economists have studied federal pay since the 1970s, and their methods and conclusions differ markedly from those of the government. Economists use statistical techniques that account for differences in workers' age, education, experience, gender, race, marital status and other characteristics.

Those studies generally have found a federal pay premium in the range of 10 percent to 20 percent, according to the 1999 Handbook of Labor Economics. A private sector worker earning $50,000 per year, for example, might receive $55,000 to $60,000 per year as a federal employee. The largest premiums are for lower-skilled employees, with smaller benefits as education increases. Interestingly, foreign studies also have found pay premiums for their government employees, suggesting government's weaker budget constraints allow public sector pay to rise above market levels.

Using the Census Bureau's 2009 Current Population Survey, the authors calculated an average federal pay premium of 12 percent over comparable private workers. Other studies tackle the issue from different angles, such as following the same workers over several years

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GovExec

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