Thou shalt not covet thy neighbor’s pay

Why do federal employees generally report less job satisfaction than those in the private sector, even though their pay, benefits, security, and working conditions are generally better?  I suspect lots of reasons.  Here is a theory:

There may be yet another explanation for why federal employees have long been less satisfied in their jobs than their private sector counterparts, a new study highlighted in Slate Tuesday reveals. Researchers from Berkeley and Princeton found that workers who know what their peers make, especially if they earn below-median pay, are more likely to be disgruntled than their blissfully ignorant peers.

Some HR thinkers have argued that more transparency would lead to better motivation and overall job happiness. If that’s true, federal employees, who have access to databases, public records and water cooler chatter over who makes what, should be much happier than their private-sector peers. But they’re not, according to data from the Partnership for Public Service, and FedBlog’s Tom Shoop wonders if a lack of pay secrets might be one reason.

One might argue, as HR gurus have, that knowing how you stand among your peers would make you motivated to perform better, in hopes of earning more. But the Berkeley and Princeton researchers argue the opposite. The study authors emailed University of California employees about a new Web site that listed the salaries of all of the university system’s employees, and then followed up to see how they felt about receiving the new information. Those who made less than median incomes reported more dissatisfaction and were more likely to say they’d be looking for a job sometime soon.

But those who made more than the median incomes did not report any kind of higher satisfaction from making more than their peers. Rather, they likely assume they’re worth it, and see the data as little more than confirmation of their superiority.

The study is a reminder, Slate’s Ray Fisman notes, of the increasing recognition by economists that humans are actually quite social when it comes to economics. Our salary doesn’t just make us happy or unhappy if we can (or can’t) cover our mortgage or buy an iPad for our spouse for Christmas. Rather, we are constantly comparing ourselves and what we earn to those around us.

via PostLeadership: My coworker makes what?! (When knowing more is not a good thing) – Jena McGregor.

That is to say, we value money not just for what we can buy with it but for the status it confers.  And what bothers us in the workplace is not just our need for a higher salary, but the prospect of other people making more than we do.  Is there anything wrong with this, or is it an example of the economic implications of coveting?

About Gene Veith

Professor of Literature at Patrick Henry College, the Director of the Cranach Institute at Concordia Theological Seminary, a columnist for World Magazine and TableTalk, and the author of 18 books on different facets of Christianity & Culture.

  • Righteous Gall

    In his 2008 book The Geography of Bliss, Eric Weiner checked out the findings of happiness researchers by traveling to what might be the happiest – and unhappiest – places on Earth. Two research findings in the book that pertain to the topic at hand are:

    (1.) Money does indeed buy happiness – up to an income level of about $15,000 per year. Beyond that, income contributes nothing to happiness, because an individual’s needs (in a modern Western society) have been met. Individual income above $15,000 goes toward wants.

    (2.) The part of the brain that’s active when wanting something, and the part of the brain that’s active when feeling happy, are completely unconnected. That’s why we feel unfulfilled after we have the things we want – including income-related status.

  • Righteous Gall

    In his 2008 book The Geography of Bliss, Eric Weiner checked out the findings of happiness researchers by traveling to what might be the happiest – and unhappiest – places on Earth. Two research findings in the book that pertain to the topic at hand are:

    (1.) Money does indeed buy happiness – up to an income level of about $15,000 per year. Beyond that, income contributes nothing to happiness, because an individual’s needs (in a modern Western society) have been met. Individual income above $15,000 goes toward wants.

    (2.) The part of the brain that’s active when wanting something, and the part of the brain that’s active when feeling happy, are completely unconnected. That’s why we feel unfulfilled after we have the things we want – including income-related status.

  • http://www.bikebubba.blogspot.com Bike Bubba

    I would suggest that another part of job satisfaction for government workers–or more properly the lack thereof despite far better pay than private sector counterparts–would have something to do with the number of levels of management they need to deal with. In my experience, three or four is about right for most enterprises. Their experience is most likely at least a dozen layers.

    It doesn’t take a rocket scientist (which many of these guys of course ARE) to figure out that one’s freedom to do one’s job is going to be adversely affected, and hence their job satisfaction.

  • http://www.bikebubba.blogspot.com Bike Bubba

    I would suggest that another part of job satisfaction for government workers–or more properly the lack thereof despite far better pay than private sector counterparts–would have something to do with the number of levels of management they need to deal with. In my experience, three or four is about right for most enterprises. Their experience is most likely at least a dozen layers.

    It doesn’t take a rocket scientist (which many of these guys of course ARE) to figure out that one’s freedom to do one’s job is going to be adversely affected, and hence their job satisfaction.

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  • –helen

    Some years ago, I was on a [lower level] staff committee, looking at wages. One thing we found then was that, despite glowing evaluations, very few of us were earning above the median for our position (2 out of 50, as I remember). Sweet talk was cheaper!

    Comes a new head of the operation, who said (second hand information) “All these people can’t be doing a ‘superior’ job; put them down a notch next time.” And it was done.

    I daresay the downgraded evaluations were more destructive than knowing we were (almost) all underpaid. Few of us doubted that “average” evaluations would be looked at first in any downsizing… and we started downsizing more than five years ago, first with a “sweetener” for early retirement, and attrition since.
    Now there is another “sweetener” out with a $$ goal attached, for [lower level] staff. If it meets the goal, there will be no layoffs “through the spring semester”. ;

    Righteous: I made a rough calculation. $15,000 would take care of my “individual” needs if I had someone with another $15K to split the rent. I live modestly.
    Happiness, so far, has been being able to give a little.

    Bike Bubba: I have three layers of supervision, plus some occasional requests from former supervisors, which I am glad to accommodate.
    Happiness is knowing that all of these people trust me to do my job without much input from them. :)

    Happiness will be keeping it awhile yet.

  • –helen

    Some years ago, I was on a [lower level] staff committee, looking at wages. One thing we found then was that, despite glowing evaluations, very few of us were earning above the median for our position (2 out of 50, as I remember). Sweet talk was cheaper!

    Comes a new head of the operation, who said (second hand information) “All these people can’t be doing a ‘superior’ job; put them down a notch next time.” And it was done.

    I daresay the downgraded evaluations were more destructive than knowing we were (almost) all underpaid. Few of us doubted that “average” evaluations would be looked at first in any downsizing… and we started downsizing more than five years ago, first with a “sweetener” for early retirement, and attrition since.
    Now there is another “sweetener” out with a $$ goal attached, for [lower level] staff. If it meets the goal, there will be no layoffs “through the spring semester”. ;

    Righteous: I made a rough calculation. $15,000 would take care of my “individual” needs if I had someone with another $15K to split the rent. I live modestly.
    Happiness, so far, has been being able to give a little.

    Bike Bubba: I have three layers of supervision, plus some occasional requests from former supervisors, which I am glad to accommodate.
    Happiness is knowing that all of these people trust me to do my job without much input from them. :)

    Happiness will be keeping it awhile yet.

  • Lisa

    It varies by field, but not all federal employees are paid better than private sector employees. I’m a federal employee and the people I went to grad school with make a LOT more than I do in the private sector! I prefer better benefits to higher gross salary though, so I’m not envious of my former classmates.

  • Lisa

    It varies by field, but not all federal employees are paid better than private sector employees. I’m a federal employee and the people I went to grad school with make a LOT more than I do in the private sector! I prefer better benefits to higher gross salary though, so I’m not envious of my former classmates.

  • WebMonk

    Lisa, I suspect the benefits are part of the measurement when statements are made about the compensation of government positions being higher than that of private sector.

    I work with people who have four weeks of vacation and another two weeks of sick/personal time off they can use, and they’ve been working with their agency less time than I’ve been working for my company (I still have the standard 2 weeks of vacation and a week of other time off). I suspect that their take-home pay is roughly equivalent to mine, but with their benefits (such as time off) and their health insurance (which seems to be phenomenal from what I’ve picked up) their overall recompense is probably higher than mine.

    However, I don’t envy their time off. I would go nuts in their work environment. I go nuts at times working with their work environment. Regulations out the wazoo! And the general work standard is to have lots and lots of time spent going around talking with others – chit-chatting about whatever catches the conversation for easily three or four hours out of the day.

  • WebMonk

    Lisa, I suspect the benefits are part of the measurement when statements are made about the compensation of government positions being higher than that of private sector.

    I work with people who have four weeks of vacation and another two weeks of sick/personal time off they can use, and they’ve been working with their agency less time than I’ve been working for my company (I still have the standard 2 weeks of vacation and a week of other time off). I suspect that their take-home pay is roughly equivalent to mine, but with their benefits (such as time off) and their health insurance (which seems to be phenomenal from what I’ve picked up) their overall recompense is probably higher than mine.

    However, I don’t envy their time off. I would go nuts in their work environment. I go nuts at times working with their work environment. Regulations out the wazoo! And the general work standard is to have lots and lots of time spent going around talking with others – chit-chatting about whatever catches the conversation for easily three or four hours out of the day.