By John Lott
President Obama lashed out at Republicans Monday for having "denigrated or vilified" public union employees. Without collective bargaining and the ability to go on strike, he said we wouldn't be able to attract "the best and the brightest to public service." Are public employees simply the best and the brightest? Or are we simply lavishing them with much better employment deals than their private counterparts?
To measure how attractive a job is, economists study how employees vote with their feet -- that is, comparing the rate at which different categories of employees voluntarily quit their jobs.
Over the last six months, private workers have been 3.4 times more likely to quit their jobs than either state and local or federal workers. Indeed, no private industry comes close to the low "quit rate" for government employees. Manufacturing, which has the lowest rate, still faces twice the quit rate as the government.
Firms compete to hire workers not just through offering good salaries and benefits, but also through working conditions and hours. Firms that offer comparably better deals not only find they have more potential workers lining up to get a job, but once an applicant gets the job, they will want to keep it.
Some union supporters claim that this low turnover rate actually demonstrates an efficiency of government. How? Because a low turnover means the government saves money since it doesn't have to retrain replacement workers. But here is the problem: if the saved retraining costs really outweighed the higher salaries and benefit costs, private companies would also volunteer to pay higher compensation.
It appears to me that unions generally try to ensure that their workers don't have to work too hard -- with mandatory breaks guaranteed and rigid protections over exactly what kind of jobs workers can be asked to do. That is on top of getting paid much more.
Take public school teachers. Over 41 percent of state and local public workers are in education. If state and local government costs are going to be reined in, state governments must deal with. By any measure, the government pays public school teachers much more than non-religious private school ones. During the 2007-08 school year, the Department of Education reports that the average public school teacher's salary, even without their much more generous benefit package, was $49,630, 37 percent higher than the $36,250 earned by private school teachers.
As shown in this figure, using data from the Department of Education, public school teachers continue to earn much more money than their private school counterparts. This goes across the board no matter what their level of experience, level of education, age, race, whether they teach in an elementary or secondary school, or where the schools are located. The smallest difference between public and private teacher salaries exists for those with a Ph.D. (about 13%) and the largest difference appears for those who are black or who work in towns (public school teachers make about 57 or 58 percent more).
It is easy to see how public school teacher salaries increase simply by being on the job longer. From 2 years to 29 years of experience, public school teacher salaries just keep rising relative to private school teachers -- going from earning a 29 percent premium during their second to forth years on the job to 49 percent markup when they have been there for 25 to 29 years.
So how do public sector unions get away with this? Simply put, they have a kind of monopoly. Parents pay for public education through their property and other taxes -- whether they send their kids to public or private schools.
Parents must really believe that the private schools are much better than the public ones to be willing to pay the public school taxes and still pay private school tuition on top of that -- effectively paying twice for school. In contrast, private schools that kept paying more and more for teachers would quickly find themselves out of business.
With all this money at stake, public unions’ reactions to proposals to weaken their power and make them more like federal workers are understandable. But still there are some surprises. On Sunday, AFL-CIO's head, Richard Trumka, in a television interview refused repeated attempts to answer questions about whether or not it was innappropriate for union activists to compare Wisconsin's Republican Governor Scott Walker to Hilter and other dictators.
A couple of weeks ago, Obama told leaders of private companies at the U.S. Chamber of Commerce that they had an obligation to hire more workers regardless of whether it meant they would lose money on hiring them. Alas, this is also his attitude towards public spending.
John R. Lott, Jr. is an economist and author of the just released revised edition of "More Guns, Less Crime" (University of Chicago Press, 2010)