Federal and Military Employee Compensation…

Source:  Military retirees say benefits hard-earned – USATODAY.com.

The news in the article above came as somewhat a shock to me.  I often hear that the military pay is substandard; that we are forcing our soldiers to live in poverty. The graph to the right seems to go against those words.  It seems that being a federal employee including ones in the military that your compensation is well above those in the private sector.  In fact being in the private sector is putting you at the bottom of the total compensation ladder in this graph!

I certainly appreciate the comments from a former military employee when she says that military families are often uprooted and told where to go and what to do. But is this any different from what also goes on in the private sector where the average person will be required to find a new job  eight times in their thirty year working history? But, going into hazardous war zones are a different matter. The article rightly goes on to say that there is actually a bigger problem with federal employee benefits system than there is for Social Security.

I have never understood why federal, including military, workers were not part of the Social Security system. If they were of course this disparity would not have happened.

Here is a quote from the article:

For every person in uniform, the government spent $201,059 last year in compensation — $86,924 for active-duty people and $114,135 on retirees. In addition, the government promised about $30,000 more in retirement compensation to those on active duty, money that will be paid later.

So it seems that the average military pay is 30% higher than the average private sector job. If you throw in future benefits the total compensation is actually 50% higher. That and the fact that private sector pensions and benefits, even if they are available today, don’t kick in until 30 years of service whereas the military retire at 20 years the disparity is even greater. General Motors before their bankruptcy and re-org had an annual per employee compensation of well less than $200,000 mentioned for federal employee compensation.

Here is part of one of the responders to this article:

I’ve spent 20 years being told where I will live, where I will go, what schools I will attend, who can and cannot be my friends, how far I can drive on a weekend, when I can take vacation, and how much I can weigh. I’m not complaining about that, it was and has been my choice to serve under these conditions. It’s simple economics. Some people are willing to work for the pay and benefits and some people are not. As long as there is a demand and shortage of supply military pay will continue to be generous.

So, it seems that the federal government is very liberal with its compensation compared to the private sector.  Even more so than General Motors before its bankruptcy.  How can we sustain those levels when GM couldn’t? Is this disparity due to shrinking middle class wages in the private sector or something else? I don’t know.

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