The two Washingtons: Public versus private sector average wage comparison

Volume 15, Number 14

By Sarah Carrico and Jason Mercier
Evergreen Freedom Foundation

As illustrated by the latest numbers released by the U.S. Department of Commerce (Bureau of Economic Analysis), employment in the government sector continues to be a lucrative career opportunity in the state of Washington. Consider that in 2003, the average private-sector wage in Washington was $44,210, while the average public-sector wage was $50,625 – a $6,415 difference. In Kitsap County (home to Bangor Naval base), the average private-sector wage was $28,943 – compared to $63,009 for those in the public-sector – a $34,066 difference.

 

2003 Average Wage Comparison

Source: U.S. Department of Commerce, Bureau of Economic Analysis

 

What is most notable about the average wage differences is the ability of public and private sector employers to increase employees' wages. While the private sector is dependent on making budget priorities within forecasted profit margins to determine what funds exist for wages, the public sector is capable of tapping—at will—the taxpayer to secure desired funds. For example, the state of Washington recently raised taxes and fees to provide, among other things, a pay increase to state employees. This tax increase enabled the state to provide a pay raise to state employees without first having to eliminate spending on other areas of the budget; the state was not forced to live within its means or prioritize the desire for an employee pay increase against other budget demands.

Conclusion

Washington’s average wage dichotomy will likely continue to exist until more is done to address the tax and regulatory policies that are inhibiting the private sector’s full potential to expand profits and employee wages. Government’s economic development focus should be on statewide reforms to improve the business climate for all employers. The answer is not for government to pick and choose the economy’s winners and losers with targeted tax breaks and taxpayer-funded economic development for the benefit of the few (i.e., the Boeing Employment Resource Center). All employers and employees are valuable to Washington’s economic health and should be treated as such. Economic relief should not be based on a business’ lobbyist’s ability to secure targeted government favors.

Jason Mercier served as an advisor to the 2002 Washington State Tax Structure Committee and is often consulted by media outlets and legislative staff for issue briefs or policy analysis. He is the author or co-author of numerous policy highlighters and in-brief reports. His editorials have appeared in newspapers and magazines including The Washington Post and on FoxNews.com. Jason received a B.A. in Political Science from Washington State University.