The National Transfer Accounts is a comprehensive and systematic method used to describe the economy in detail through the economic life cycle and the reallocation of economic resources between generations.
Numerous studies, including two separate analyses by The Heritage Foundation, have concluded that federal workers do receive a substantial wage premium. Most of these studies have used the cross-sectional human capital method, which compares federal workers to private workers who have the same skills. The cross-sectional method is not perfect, however, and supplemental analyses can be useful in confirming its results. Rather than comparing workers at a single point in time, this report follows individual workers as they switch between the federal and private sectors. It finds that workers who change jobs receive a substantially larger raise when they switch into federal employment rather than into another private job. This result corroborates the findings of the cross-sectional studies, providing further evidence that federal workers enjoy a wage premium.