A Note on Public Sector Pay
By Arnold Kling
The chart shows that public and private sector pay rose in parallel from 2001 to 2004. Then the lines diverged. Since early 2005, public sector pay has risen by 5% in real terms. Meanwhile, private sector pay has been flat.
Keep that in mind when people tell you that we absolutely have to prevent “fifty Herbert Hoovers” from having to make cutbacks in state and local budgets.