In his recent rebuttal to critics of his finding that the average federal employee makes a lot more in salary and benefits than the average private sector employee, my colleague Chris Edwards notes:
A final consideration is to look at a “market test” of the adequacy of compensation in the public sector–the quit rate. The voluntary quit rate in the federal government is just one-third or less the quit rate in the private sector (Table 16 near the bottom here). That is strongly suggestive of ”golden handcuffs” in federal employment. While many federal workers probably grumble about their jobs (as many private sector workers do), they know that the overall package of wages, benefits, and extreme job security (Table 18 here) is very hard to match in the competitive private market, and so they stay put.
Looking at that Table 16 of government employment data shows that the "quit rate" in state and local government is similar to the federal figure, and in some years, even lower. A Stateline.org story from this past Thursday notes:
In the face of unrelenting gloom, Indiana personnel director Daniel Hackler says the recession offers a few bright spots. The state’s poor private-sector job market – worse than the national average – has lowered voluntary turnover and made state government the employer of choice. Financial worries have also stanched a retirement boom that had threatened to drain the state of much of its institutional knowledge.
As I mentioned a couple weeks ago when the Rockefeller Institute announced that state and local government employment has gone up since the beginning of the recession while the private sector has bled jobs, state government "as the employer of choice" is bad news for the economy as government jobs are inherently parasitic.
And while we're on the subject, I can't help but take a shot at Stateline's characterization of Indiana's employee performance review system as "rigorous." Having worked in Indiana's Office of Management and Budget, I certainly don't recall anything "rigorous" about the state's management of its studs and duds (to say there was a lot more of the latter would be an understatement). I also knew more than a few apparent “studs” pulling in nice incomes and benefits who really deserved pink slips instead of pay increases. But then again, most of the these "make government run like a business" initiatives like "pay for performance" and "performance metrics" are really just serious sounding gimmicks that politicians employ when they don't have the desire or stomach to actually cut government or reduce its role in our lives.