Federal employee wage freeze expected to impact area’s economy by $200M annually

By City News Service

President Barack Obama’s plan to freeze wages of most federal workers for two years will cost the San Diego-area economy nearly $200 million annually, an economist said Wednesday.

Kelly Cunningham of the National University System Institute for Policy Research estimated the direct loss at $108 million — pay that would going to federal employees if they got raises — and the overall loss to the regional economy at $190.3 million. The larger figure includes the loss of direct compensation and the effects of reduced spending.

“Our economy was estimated to be $170 billion in 2009, so a total of $190 million is a little over 1 percent of that,” Cunningham said. “In a struggling economy, that’s another blow.”

Cunningham said he calculated the wages of local federal workers, compared to pay increase data since 2007 to arrive at his conclusions.

Despite the cost to the local economy, the $5 billion savings to the federal government is needed to control debt, he said.

The proposed pay freeze does not include postal workers or members of the armed forces, though civilian employees of the Defense Department will be affected.

The federal government employs about 37,000 people in the area, excluding postal employees, he said. On average, Cunningham said, people working for the federal government make about 1.5 percent more than privately employed people in similar jobs.

Related posts:

  1. San Diego economic indicators remain unchanged for third month
  2. Economic indicators for San Diego show slight dip in September
  3. Unemployment rate in county was 10.6 percent in August
  4. COO: If tax measure fails, city faces $23 million in cuts
  5. Report: Nearly 1/3 of SD residents make less than cost of living

Short URL: http://www.lajollalight.com/?p=29966

Posted by Halie Johnson on Dec 1, 2010. Filed under News, Region. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

Leave a Reply

La Jolla Community Calendar


Bottom Buttons 1

Bottom Buttons 2

Bottom Buttons 3

Bottom Buttons 4

Bottom Buttons 5

Bottom Buttons 6

RSS North Coastal News

  • Surf Soccer Club Academy GU9 team tops in division at 2014 Albion Cup July 25, 2014
    The Surf Soccer Club Academy GU9 team took first place in the 2014 Albion Cup (Girls U9 Cup) on July 18-21. They beat Carlsbad United’s top GU9 team in the semi-finals and went on to shut out Strikers FC in the finals, 4-0. Awesome tournament play by the entire team! […]
  • Surf Academy Select BU9 win it all at Albion Cup July 25, 2014
    San Diego Surf Academy Select BU9 won it all at the Albion Cup July 19-21! After winning their Showcase division by going unbeaten all weekend, they defeated Legends FC 4-1 in the finals on Monday. This is the second year in a row this team has won the Albion Cup. […]
  • Pushing boundaries July 24, 2014
    Few issues cause parents more distress than changes in school boundaries. Who can forget the tumult when in 2002 the Del Mar Union School District moved hundreds of families from one attendance area to another? Resentment still lingers, 12 years later. The San Dieguito Union High School District created its system of boundaries nearly 18 years ago that has w […]