Monday, April 25, 2016

How much does the average state employee cost taxpayers? - By Thomas Lifson

Thanks to lavish medical and retirement benefits that kick in at a young age (often permitting a second career, resulting in two paychecks), a vast economic gulf is opening up between average taxpayers and average government employees.  America is slipping into a nation with a governing class enjoying a far better life than those they govern.

Michigan Capitol Confidential has done a very useful calculation that I would like to see performed for every state.  James M. Hohman writes:

The average state employee now costs taxpayers $117,000 per year, according to data from the state Department of Civil Service. This includes both salaries and benefits.

Note that the average household income in Michigan (which includes multiple earners in some families) was $48,273 in 2013.  But when it comes to what is now a laughably obsolete term, “civil servants,” those average household taxpayers are paying more and getting less:

The total cost of benefits has exploded, even though there are fewer state employees. Annual retirement costs increased from $431.8 million in 2001 to $1.6 billion in 2015. (snip)

The rise in employment costs has occurred even though the number of administrators, corrections officers, conservation officers and others on the state payroll has fallen drastically over the past 15 years.

The state hasn’t cut back on its functions much, but the number of people performing those functions fell from 62,057 full-time equivalent workers in 2001 to 46,588 FTEs in 2015. Despite the smaller workforce, their annual cost has increased from $3.9 billion to $5.4 billion.

The growing average costs of employment have spread the government workforce thin while also requiring more cash. As a former House Appropriations Chair Chuck Moss once quipped, “At this rate, eventually the entire budget will go to employ just one person.”

The growth in total compensation cost for what should now be called “civil masters” instead of “servants” is nearly accounted for by health care, retirement, and other benefits.

In the new class structure of America, the majority of the population lives with uncertainty and anxiety over health care and funding retirement, while the class of masters can spend everything they earn, instead of scrimping and saving like the common folk, free from worry over the ability to pay for medical care, or living out the senior years in dire poverty.