State and Local Government Wages: How Wyoming Compares to The Surrounding States

by Wyoming Liberty Group Staff

My previous work looked at state and local government wages in the state of Wyoming. On average, in the state of Wyoming, there is a wage premium of 23% in state government. This analysis uses wages data from the Bureau of Labor and Statics, that does not include benefits. Local government employees' wages are similar to the private sector wages in the state. In Wyoming and the surrounding states, we see the same trend, that on average state employees' wages are higher than the private sector and local governments' wages are comparable to those paid in the private sector.

Figure 1

Wyoming has the largest state government wage premium when compared to the surrounding states. That premium in wages is 6.2% higher than the average wage premium of 16.1% that is seen for all of the seven states. In the other six states, the state government makes up around 5% of the entire labor force. Wyoming follows this trend with 5.4% of the workforce being state government employment. The average wage premium that is seen in Wyoming points to the trend that state employees are paid well compared to the private sector. Why this is the case is not completely clear. This analysis only looks at the averages and not at individual professions, considering the years of experience, and the education level that the employee has. All of these factors affect compensation. A more thorough analysis that compares the same professions in both the public and private sectors and accounts for years of experience and other compensation factors would need to be done to get a better idea of the trends that are seen.

Figure 2

Local government in Wyoming makes up a much larger share of government employment. As we can see in figure 2, those local government jobs pay about the same overall as the private sector in the state. In other States such as Montana and Nebraska, this also seems to be the case. In South Dakota, Idaho, Colorado, and Utah, the local government jobs pay much less on average than the private sector. This may be the result of significantly smaller local government in those states (around 3% smaller in most of the other states).

On average both state and local government employees in the state of Wyoming are paid higher wages than the private sector in this state and all of the surrounding states. This could be due to the differing funding mechanism for local government than in other states. More study is needed here to say why this is the case.