In the editorial "Government work" (June 21 and TribLIVE.com), the Trib concluded that public-sector workers are paid more than their private-sector counterparts. The editorial compares public-sector and private-sector salaries without any regard to the different professional characteristics of workers in each group.
Because public-sector workers have more human capital -- for instance, they are more likely to be college educated and have more experience -- it shouldn't be surprising that their pay is higher, on average, than in the private sector, where workers typically have less education and experience.
When you account for differences in human capital -- a standard practice in economics -- you find that state employees in Pennsylvania earn on average 4.5 percent less in wages than comparable private-sector workers. Local-government employees earn on average 12.9 percent less in wages than comparable private-sector workers.
Better pension and health benefits in the public sector likely narrow this wage disadvantage, but clearly the teachers, firefighters and park rangers who serve the public good are not overpaid for their services.
Mark Price & Daniel Cokes
Mark Price is a labor economist and Daniel Cokes is an intern at the Keystone Research Center in Harrisburg.
