A news service for the people of Michigan from the Mackinac Center for Public Policy

Public-sector average compensation grows while private sector's decreases

Spokespersons for Michigan government employee unions contend that they have given up hundreds of millions of dollars in wages and benefit concessions over the past few years. The claims are in dispute, and data from the U.S. Bureau of Economic Analysis offers some support for those challenging them. It shows that since 2000, government-employee compensation in Michigan has increased 11.4 percent, while private-sector employees are getting 5.1 percent less.

The trend continued in 2009. Average compensation per employee — which includes the value of benefits — was down 2.0 percent for private sector employees but increased 3.6 percent for Michigan's state and local government employees.

Overall, the total amount spent statewide on private-sector compensation, as opposed to the average compensation per worker, was 10.2 percent lower in 2009, while total state and local government compensation increased 2.6 percent. This reflects the contraction of the Michigan private sector workforce last year, as well as the lower level of compensation per worker.  

The original version of this story was posted online on March 31, 2010. 

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