Wage Comparability in the U.S. Postal Service

Abstract

Federal law requires that the U.S. Postal Service pay wages comparable to those paid in the private sector. The authors argue that the appropriate test of that concept is a comparison of the wages paid to all comparably skilled workers, not only to white male workers in the private sector. By that standard, the authors conclude, from an analysis of CPS data, that in 1978 postal workers enjoyed a 21 percent wage advantage. They also point to the low quit rates and long employment queues in the Postal Service as evidence confirming that the wage of postal workers is well above that of comparable workers elsewhere. The authors predict that since the mail transmission market has become increasingly competitive, either the wage advantage of postal workers will decline or postal jobs will continue to shift to the private sector.