C.J. Careers - Comparing Pay of Federal and Non-Federal Police Officer Jobs
1 The September 2001 terrorist attacks have heightened policymakers' concerns about the federal government's ability to recruit and retain high-quality personnel for those positions. Central to those concerns is the level of federal pay for law enforcement jobs in comparison with that offered by state and local governments, particularly in metropolitan areas where the cost of living is high. This Congressional Budget Office (CBO) analysis compares the pay (wages and salaries) of federal law enforcement officers with the pay of similar nonfederal officers (those employed by state and localââ¬âincluding county ââ¬âgovernments).2 CBO's study was restricted to cash compensation, for which comprehensive data are available. It did not address total compensationââ¬âearnings plus benefits.
The federal government competes in various labor markets with state and local governments'nd to a lesser extent, those public-sector employers compete with private providers of protective servicesââ¬âfor people with law enforcement skills. To compare the pay of federal officers with that of state and local officers, CBO used data from the 2000 decennial census. Its analysis focused on five of the census's classifications of law enforcement jobs: police officers; detectives and criminal investigators; corrections officers (including bailiffs and jailers); police supervisors; and corrections supervisors.
A number of factors may account for observed differences in pay in addition to the pay structure of an officer's employer. Those factors include nonwage employment benefitsââ¬â for example, contributions by employers for retirement and health insurance; differences in the skills and abilities of the people in law enforcement jobs, important aspects of which are education and previous experience; a particular job's requirements; and individuals' preferences ââ¬âfor instance, whether people are willing to move often, as some federal jobs demand, and how much risk they are willing to tolerate.
CBO used statistical techniquesââ¬âbased on a human capital approach to pay determinationââ¬âto account for officers' personal and job characteristics that affect their pay. After taking those characteristics into account, CBO found that federal pay tended to be higher than state and local pay when compared on the basis of national averages. Federal police officers, investigators, and corrections officers on average earned more than their state and local counterparts. However, those average results do not take into account possible differences between federal and nonfederal employment benefits. Moreover, the national averages mask important differences among regions and localities. As an example, for police officers in several major metropolitan areas (such as New York and Los Angeles), federal salaries are below the salaries paid by state and local law enforcement agencies.
The Congressional Budget Office's (CBO's) pay comparison of federal and state and local law enforcement officers focused on cash compensation. Total compensation includes not only earnings from salaries and wages but also the value of employment benefits, such as retirement, health care, and life insurance benefits; holiday and vacation pay; and subsidies for transportation, housing, and uniforms. Benefits are a significant part of employees' remuneration. A 1998 analysis by CBO found that, depending on employees' age, salary, length of service, and retirement plan, benefits for federal employees accounted for 26 percent to 50 percent of their total compensation.1 For employees of large private firms, benefits made up 24 percent to 44 percent of compensation. (Law enforcement retirement falls under the governmentwide Federal Employees Retirement System, or FERS'nd for certain older officers, under the Civil Service Retirement Systemââ¬âbut it has additional enhancements.)
In 1990, the National Advisory Commission on Law Enforcement (NACLE) compared the employment benefits provided to state and local law enforcement officers with those received by federal law enforcement officers.2 The commission determined that, relative to state and local governments, ââ¬Å[t]he federal government more often provides fewer benefits in the areas of life insurance, paid holidays, cash allowances, employee cost and some aspects of coverage of health insurance, and disability benefits.ââ¬Â The commission also concluded that federal law enforcement retirement benefits generally ââ¬Åcompare favorably to those provided by state and local employers, but the cost to the federal employee is higher than that of the state and local employee.ââ¬Â3 NACLE's report was based on the results of a nationwide survey of law enforcement agencies and officers. No comparable data on benefits have been collected since that 1990 survey.
Information is available concerning federal as well as state and local retirement plans for law enforcement officers.4 However, the complexity of those plans' provisions makes comparison difficult and subject to a large number of assumptions. Such an analysis is beyond the scope of this report. Nevertheless, the data generally indicate a high degree of variability among state retirement plans.
Those findings are consistent with some observers' criticism of the federal pay structure for law enforcement officers as too inflexible to allow federal employers to be competitive in the labor market for law enforcement officers. The approach that has been taken in legislation introduced in the 108th and 109th Congresses attempts to ensure that pay for federal law enforcement officers is comparable with pay for state and local officers. Specifically, in many geographic job markets in which the federal government employs law enforcement officers, those bills would increase locality adjustments for officersââ¬â rather than change their across-the-board payââ¬âin an attempt to enhance the federal government's competitiveness in hiring and retention.
To read the full report on pay of police officers federal and non-federal please visit www.cbo.gov/ftpdocs/66xx/doc6619/08-23-LawEnforcementPay.pdf