Results of Studies on Federal Pay Varied Due to Differing Methodologies

Source: United States Government Accountability Office, GAO-12-564, June 2012

From the summary:
…GS employees are eligible to receive three types of pay increases and monetary awards that are linked to individual performance appraisals: within-grade increases, ratings-based cash awards, and quality step increases. Within-grade increases are the least strongly linked to performance, ratings-based cash awards are more strongly linked to performance depending on the rating system the agency uses, and quality step increases are also more strongly linked to performance.

Findings of selected pay and total compensation (pay and benefit) comparison studies varied due to different approaches, methods, and data. Regarding their pay analysis, the studies’ conclusions varied on which sector had the higher pay and the size of pay disparities. However, the overall pay disparity number does not tell the whole story; each of the studies that examined whether differences in pay varied among categories of workers, such as highly or less educated workers or workers in different occupations, found such variations. Three approaches were used to compare pay:
– human capital approach (3 studies)–compares pay for individuals with various personal attributes (e.g., education, experience) and other attributes (e.g., occupation, firm size);
– job-to-job approach (2 studies)–compares pay for similar jobs of various types based on job-related attributes such as occupation, does not take into account the personal attributes of the workers currently filling them; and
– trend analysis approach (1 study)–illustrates broad trends in pay over time without controlling for attributes of the workers or jobs.
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