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December 5 2012

Why We Can Shrink the Public Sector and Still Get Everything Done

Charlotte Hays

Whenever I hear about state and local government shrinking as a result of tight economic times, I say, “Well, every dark cloud has a silver lining.”

I am sorry about the public employees who are laid off and wish them good speed in finding good jobs in the private sector.

Democrats, not to put too fine a point on it, tend see things differently.

The Obama administration is asking for federal aid to ensure that state and local governments keep their employment near prerecession levels. This is in addition to the $250 billion for local-government employment in the 2009 Recovery Act.    

Andrew Biggs of the American Enterprise Institute and Jason Richwine of the Heritage Foundation, who’ve previously done such a fine job of analyzing teacher pay, explain why this is so wrong:

[S]upporters of more federal aid implicitly assume that the size of the public sector was optimal before the recession. On the contrary, overstaffing is a serious problem in government, and the best evidence is a simple empirical fact: Government employees don't work as much as private employees.

If public-sector employees just worked as many hours as their private counterparts, governments at all levels could save more than $100 billion in annual labor costs.

It is of course difficult to know how many hours a week a person works. Biggs and Richwine looked at the American Time Use Survey, which the Bureau of Labor Statistics administers to a large sample of American workers. It asks participants to fill out a “time diary” for 24-hour periods. It is considered the best tool available for measuring how much a person works.

Using this survey, Biggs and Richwine ascertained that government workers put in fewer hours than their private-sector counterparts:  

What we found was that during a typical workweek, private-sector employees work about 41.4 hours. Federal workers, by contrast, put in 38.7 hours, and state and local government employees work 38.1 hours. In a calendar year, private-sector employees work the equivalent of 3.8 more 40-hour workweeks than federal employees and 4.7 more weeks than state and local government workers. Put another way, private employees spend around an extra month working each year compared with public employees. If the public sector worked that additional month, governments could theoretically save around $130 billion in annual labor costs without reducing services. …

Based on the most detailed and objective data set available, the private sector really does work more than the public sector. This fact may hold different lessons for different people, but our own take is simple: Before we ask private-sector employees to work more to support government, government itself should work as much as the private sectors.

The Obama administration wants the more productive to pay more money to support the less productive. That--in a nutshell--is modern Washington.

Independent Women’s Forum’s mission is to improve the lives of Americans by increasing the number of women who value free markets and personal liberty. Sister organization of Independent Women’s Voice.
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