Today, the House of Representatives will consider H.R. 3835, introduced by Rep. Sean Duffy, R-Wisc., which would extend the pay limitation for Members of Congress and Federal employees for one more year. The legislation would save taxpayers $26.2 billion.
Rep. Dennis Ross, R-Fla., chairman of the subcommittee charged with oversight of the federal workforce, cited a study issued Monday by the non-partisan Congressional Budget Office (CBO) to answer assertions that federal employees are underpaid and that this policy would hurt the federal government's ability to recruit and retain highly skilled workers.
CBO found that total compensation for federal employees was 16% greater than for private sector employees.
"An across the board pay increase for federal workers is unwarranted, and the claim that federal employees are underpaid is a demonstrable myth," Ross said.
The CBO study also found that:
* Benefits were 48% more costly for federal employees than private sector employees.
* Highly-skilled employees (with a professional degree or PhD) were the only employees compensated less than their private sector counterparts.
* Taking benefits out of the equation, federal employees made 2% more than private sector workers at large companies and 9% more than private sector workers overall.
Ross urged his colleagues to approve H.R. 3835, noting that it fulfills the final year of a three year pay freeze policy called for by the President's own National Commission on Fiscal Responsibility and Reform. President Obama has proposed ending the pay freeze after only two years.
"The President's pay hike proposal is fiscally irresponsible, especially as he is proposing to cut defense budgets," Ross continued.
CBO couldn't account for certain unquantifiable benefits, including "great job security and less uncertainty about the size of pay raises," which should decrease the compensation that the federal government needs to offer "to attract and retain employees."
The compensation gap for highly educated employees may be a byproduct of the rigid federal pay system. CBO noted that federal pay systems "make it harder for managers to reward the highest performers or limit compensation for the lower performers."
Ross' subcommittee first studied this issue at a March 2011 hearing, leading the House Oversight and Government Reform Committee to recommend the extension of the pay freeze. The House has approved an extension of the pay freeze twice, first in the FY2012 budget resolution and then again in the Middle Class Tax Relief and Job Creation Act approved in December.