Researcher and Writer in Washington, DC

Did Unionized Federal Employees Get a 5.7% Pay Raise In 2011?

Men Working in U.S. government's Weather Office, 1926. Source: Library of Congress

The short answer to this question is “no.”

But you might be forgiven for thinking otherwise had you read this February 1, 2012 BGov article, “Federal Union Workers Get 5.7% Raise in Freeze.”  BGov took an interesting data find from a Bureau of Labor Statistics (BLS) report and turned it into something bigger.

To understand what went awry here, one first must get a few basic facts straight about federal employees and their pay.

(1) Most federal civilian employees are paid based upon the government-wide General Schedule.  The wages set in the General Schedule have not changed since January 2010.  Agencies follow the general schedule when they pay their employees. (That’s the law.).

(2) With few exceptions (e.g. postal workers), most federal civil servants do not bargain for their wages.  As point (1) notes, federal wages are set by the General Schedule, which is decided by Congress and the President.

(3) Federal employees earn pay raises either through earning promotions (from one General Schedule—or GS—level to the next) or by earning “step” increases due to time spent in their jobs. (Each GS level has ten steps, and it takes 18 years to go from step 1 to step 10 within a GS pay level.)

So, with these facts in mind, let us return to the BGov article.

Most plainly, for the article to frame the topic as a matter of “union federal employees” injects a red herring.  Whether a federal employee belongs to a union or not he is paid according to the GS scale.  So unionism did not produce the 5.7% increase in median federal wage in 2011. Indeed, federal unions were rebuffed by Congress and the President this past year when they sought an increase in the GS wages.

So, assuming the BLS study is correct, the question becomes, “How could the federal median federal wage go up 5.7% when the GS scale of wages was not increased?”

Rather than plumb this tricky question, regrettably the BGov article takes the lazy route.  It turns to Professor Gary Chaison, who tells BGov that federal agencies have the discretion to move money around and give their people pay raises.  Chaison reportedly also says the government’s failure to pass a budget last year makes it difficult to track agency wage outlays.  Put this all together and the picture is this: the rise in median federal wages has been produced by wily, unionized federal agencies who furtively dodge the wage cap  and use their own authority to raise employees’ pay.

I can only hope that Professor Chaison was misquoted because this hypothesis is absolutely batty.  Here is why.

(1) Federal agencies cannot just shift money around to free up cash to give their employees raises. Again, wages are set by the General Schedule.  If, say, a civil servant is a GS-9 step 2 in 2010, well, come 2011 his additional year of federal service will entitle him to get a step increase to GS-9, step 3 (unless his superiors grade his work as bad and deny his step increase). This is how it the GS system works, and agencies are obliged to allocate the money to pay this employee his increased wage.  This is very different from Chaison’s picture of an agency deciding to “move money” in order to hand out raises.

(2) Whether the Congress passes a budget or whether the federal government was funded via continuing appropriations has absolutely nothing to do with the visibility of agency outlays for wages.  Zero.  There’s no nexus.  If Congress or the President want to know what agencies are spending on wages they can consult the Office of Personnel Management, which keeps this data.

(3) The BGov article is predicated on the conflation of two different policies: not increasing the GS scale wages vs. freezing the wages of each federal employee. Congress and the President chose the former course, not the latter, which would prohibit any federal employee from getting promoted from one GS level to another or from moving from one step to the next.

(4) The article unfortunately treats an increase in median federal wages as a raise for federal employees generally—that is both a fallacy, and it misconstrues the nature of a median.  To understand how one need only look at a hypothetical example.  Suppose an agency has five employees earning $20k, $30k, $40k, $50k, and $60k.  The median would be $40k.  Now suppose the employee earning $20k retires. The median would rise to $45k, despite nobody getting an increase in pay.  Or, to take another example, one could take the same five employees—earning $20k, $30k, $40k, $50k, $60k)—and then assume the employee earning $40k get promoted and have his pay increased to $50k. This would shift the median to $50k, despite only one of the five employees having his pay lifted. (Anyone needing a refresher on how the median is calculated should play with  this calculator.)

So, BGov pulled a boner with this piece.

Nevertheless, the question lingers—why did the BLS report show median federal wages grow 5.7% from 2010 to 2011?

I wish I knew.  The answer lies deep within the data, and involves a shift in the distribution of employees due to federal employee layoffs or retirements, time-in-service increases, or somesuch.  It is a pity BGov in this instance chose sensationalism over analysis.

 

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