Is The U.S. Government The Last Great Source Of Middle Class American Jobs?

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Once upon a time, private industry was the engine of the great American economic machine.  From coast to coast, expanding industries spawned massive cities filled with optimistic Americans who were able to achieve middle class lifestyles on the good jobs that American companies were providing for them.  The largest middle class in the history of the world had been created and it seemed possible for just about everyone to live the American Dream.  But today all of that has changed.  The private sector is being dominated by gigantic global corporations that have shown absolutely no hesitation to ship jobs overseas.  Millions upon millions of good jobs have been sent to China, India and the third world and they are never coming back.  Pay and benefits for middle class Americans working in private industry have been slowly eroding and are now at dangerously low levels.  Meanwhile, working as a “government servant” has never been more rewarding.  Today, the average government worker makes far more than the average worker in the private sector does.

 

How much more?

Well, according to a new study from the Heritage Foundation, U.S. government workers earn 30 to 40 percent more money than their private sector counterparts on average.

So, in essence, the “servants” make substantially more money than the taxpayers who employ them.

Isn’t the system great?

In fact, according to the study, if you add in retirement and health care benefits, the average federal employee now earns nearly twice as much as the average private sector employee.

Ouch.

Just check out this excerpt from the study….

“Including non-cash benefits adds to this disparity. The average private-sector employer pays $9,882 per employee in annual benefits, while the federal government pays an average of $32,115 per employee.”

Yes, it is very good to be a U.S. government employee in 2010.

Meanwhile, the private sector continues to bleed jobs.  The U.S. economy lost 131,000 more jobs during the month of July.  Needless to say, the vast majority of those job losses came from private industry.

The truth is that it is becoming very, very difficult to live a middle class lifestyle if you do not work for the government.

A reader of this column named Tim recently shared the difficult experiences he has been going through as an employee in the private sector….

Been with my current company over 12 years. Last pay raise I got was six years ago. The last two years we’ve had our salaries actually reduced. 401K matching, vacation time, company stock purchase plans, actual pay, all gone or reduced. Me and buddies figure it to be about ~14% overall reduction. At my level I was averaging a 10% annual bonus (which are now a vague memory).

All in all, I am NOW working longer hours, at a much less satisfying job (it actually sucks), for about 20-25% less than I was making just 3 years ago.

My company was once a very highly respected company for the way it treated employees and the loyalty that created. We were long term focused, made great products. but now? ha! Upper management pushes harder and harder so they get their *quarterly* bonuses. Below VP level, people, and I mean a LOT of people are now pushing 55-60+ hour weeks for fear of losing their jobs.

With all this said – I still consider myself LUCKY. Even with the ~20% pay reduction, I still make very good money. But one thing has drastically changed. I no longer circulate my money. It all goes into savings. Every spare penny. And while this is good for me, we all understand it is at the expense of the local economy.

The saddest thing is to see my kids now graduating from college (two in the last four years!). They are entering a dismal job market with no hope of “true” recovery in the foreseeable future.

Of course the U.S. government cannot keep paying their workers above market wages forever.

But for now, if you need a good job and can stand to do it, working for the U.S. government pays really, really well.

Might as well jump on the gravy train for as long as it lasts.

So is this a good system?

Of course not.

The true wealth of a nation is produced by the private sector.  But unfortunately, the private sector is providing fewer and fewer good jobs in the United States.

The truth is that the U.S. government has become the last great source of middle class American jobs.  This will not be able to last indefinitely, but for now those seeking the safety and security of a job (“just over broke”) should be looking to the government because the chances of getting a great job in the private sector are getting slimmer by the day.

Kindle Version Of The Beginning Of The End

   
  • Gary

    I love hearing people whine about how the government jobs pay so much better than the private sector. I have a great idea. How about they put that energy into complaining that the private sector pays so poorly?

    Private sector needs to be brought up to the level of gov and not the gov being brought down to the level of the private sector.

    We are seeing the Walmart-ina-zation of private jobs.

    Low pay crap jobs.

    Have you ever noticed how hard it is to get a gov/state/county/city job? That’s because they are so much better than the private sector.

  • Gary

    One thing I heard on NPR was that the gov workers are on average more educated than the private sector-teachers etc. A lot of the gov workers also do not get any ssi.

    Until we have the employee free choice act passed and unions can force companies to make these crap service jobs good jobs nothing will change. Manufacturing jobs used to be terrible but due to the hard work of unions they got to be good paying. Service jobs do not need to be bad jobs. They are bad because employers are able to make them so bad. One reason Gov jobs are still so good is that they are unionized.

    Like I said in a previous post it is extremely hard to get a gov job.

    EVERYONE I know would love one (gov job). They and me would quit the private sector in a new york minute for a gov job.

  • Justa Guy

    Agree with what Tim in the article said. My situation reflects his statement, 20-25% less income then a couple years ago. I believe many people (probably 1/4 to 1/3) in the private sector, if they’re currently employed, are living with the same scenario. You can’t have an economic recovery in this situation, because even the people who haven’t been impacted in this way are probably unwilling to spend their discretionary income. Most are probably watching the people who are suffering, thinking, “I’d better hold on to my money, in case what happened to them happens to me”. And don’t forget, the govt and companies that sell us necessary expense items like food, gas, and utilities are taking this opportunity to rape us of what money we might have had left, under the guise of “times are tough, so we have to charge more”. Anyone running/leeching off these organizations ever think of pocketing a little less for the good of the country? Of course not, because their greed knows no bounds.

  • Gary, I think you missed the whole point of the article. Government jobs are built on private sector taxes. So as the priave sector shrinks, government jobs need to shrink in scale as well. I know LOTS of government workers, and they are no dumber or smarter than the rest. They are just the “lucky few” that have cushy government work. But that will crash in on them soon, and they will have to join us private sector workers in the real world.

  • tom

    Qualifications being equal, I suspect that government jobs pay less. At least that was the case when I briefly worked for the state a few years ago. They have a hard time retaining talent. And now they’re trying to fill the same position for 20% less pay.