The Wall Street Journal reports that Los Angeles is facing a severe budget deficit. The article describes municipal payroll and pension contribution information, which suggests the average city worker gets paid about $78,000 in salary. The city's pension contribution has averaged $16,500 per employee the past several years. Adding in health and other benefits pushes total compensation per worker to over $100,000 per year.
Unfortunately, high and growing compensation costs are one of the fundamental reasons for budget deficits at state and local governments.
If you want to fix state and municipal budgets, and keep taxes under control, compensation costs need to be reduced. It will take a great deal of political courage and perseverance on our leaders to make this happen, since any efforts to reduce government employees wages and benefits will be vociferously attacked by political powerful constituencies - the effected employees and the unions that often represent them.
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