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Government Wage Differentials in a Municipal Labor Market: The Case of Houston Metropolitan Transit Workers

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  • William J. Moore
  • Robert J. Newman

Abstract

Previous studies of wage and fringe benefit differentials between public and private sector workers have generally employed one of three different methods to measure the differentials. This study is the first to use all three simultaneously. The authors find that the Houston Metropolitan Transit Authority provided total hourly compensation that was 82.8% higher for cleaners, 82.9% higher for bus drivers, and 31.3% higher for mechanics than the compensation received by comparable private sector workers in 1988. Separation rates for these three groups were less than half the national rate for similar workers. These findings suggest that previous studies, most of which have shown no significant wage premium for government workers, may be misleading. Also, estimates of government wage differentials may be biased downward for skilled workers because available data sets generally lack adequate information on fringe benefits and their distribution across occupations.

Suggested Citation

  • William J. Moore & Robert J. Newman, 1991. "Government Wage Differentials in a Municipal Labor Market: The Case of Houston Metropolitan Transit Workers," ILR Review, Cornell University, ILR School, vol. 45(1), pages 145-153, October.
    • Handle: RePEc:sae:ilrrev:v:45:y:1991:i:1:p:145-153
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    1. repec:eee:labchp:v:3:y:1999:i:pc:p:3573-3630 is not listed on IDEAS
    2. Gregory, Robert G. & Borland, Jeff, 1999. "Recent developments in public sector labor markets," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 53, pages 3573-3630, Elsevier.
    3. James M. Poterba & Kim S. Rueben, 1998. "Fiscal Institutions and Public Sector Labor Markets," NBER Working Papers 6659, National Bureau of Economic Research, Inc.
    4. George J. Borjas, 2002. "The Wage Structure and the Sorting of Workers into the Public Sector," NBER Working Papers 9313, National Bureau of Economic Research, Inc.
    5. James M. Poterba & Kim S. Rueben, 1994. "The Distribution of Public Sector Wage Premia: New Evidence Using Quantile Regression Methods," NBER Working Papers 4734, National Bureau of Economic Research, Inc.
    6. Bahman Bahrami & John Bitzan & Jay Leitch, 2009. "Union Worker Wage Effect in the Public Sector," Journal of Labor Research, Springer, vol. 30(1), pages 35-51, March.
    7. Dale Belman & John S. Heywood, 2004. "Public-Sector Wage Comparability: The Role of Earnings Dispersion," Public Finance Review, , vol. 32(6), pages 567-587, November.
    8. Kingsley E. Haynes, 1997. "Labor markets and regional transportation improvements: the case of high-speed trains An introduction and review," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 31(1), pages 57-76.

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