March 25, 2010

Over thirty-five years ago I knew a young engineer I worked with. The company we worked for for was a large engineering company with a lot of employees and a lot of work.

Nuclear power plants were the style then and they were hiring left and right and for reasonably good salaries and benefits because the competition was doing the same.

Well, this colleague of mine announced one day that he was leaving the company and was going to work for the New York City Transit Authority. This company was the predecessor of MTA New York City Transit. They ran the subways and buses .

I knew that the salary he was to get was way below what he was making at our company but he told me that the benefits were a great deal better than ours in the private sector.

Years later I met an engineer in New Jersey who worked for that state's Department of Transportation. This man was bright, he wrote some books and he knew structural engineering inside out.

His salary was also way below the norm for the private sector.

And in between these two that I knew there were thousands of professionals (at least in the New York area) who chose to work for municipal and governmental agencies for far less compensation than they could have gotten from the private companies.

Why did they do this seemingly illogical thing?

Because the municipal and governmental agencies gave something that the private sector didn't.

First, they provided job security. Then, they provided a pension plan. Then, they gave a free lifetime medical plan for the family. The transportation agencies also gave free transportation to the employees and spouses.

Comparing these benefits with the straight salaries no wonder people were drifting away from the companies. But the agencies were forced to do this in order to attract quality professionals.

Now, let's jump ahead to today and let's see what is the situation.

First of all, the definition of job security today means if one has a job this week it does not mean he will have one next week. Governmental agencies are cutting their work forces across the board.

Professionals and non-professionals are equally on shaky grounds and that includes police and firemen.

Now here is another thing. In order to attract the right quality workers the agencies were forced to increase their salary levels to par or even above the the private sector. So now, the professionals and non-professionals are a lot better off than their counterparts on the other side of the line.

But with salaries so high aren't the benefits a little exaggerated? Why should an employee after 25 to 30 years of service should be able to retire with 75% percent of his salary AND free lifetime medical insurance?

I can understand that some people joined these agencies long-long time ago when salaries were really low. They do deserve these benefits. But the ones joining now with incomes a lot higher should not be given the same benefits.

No wonder this City and many other municipalities are having serious financial troubles. They are giving away the store.

There are such disparaging differences in life that it is just unbelievable. Why is it that a professional person who spent his entire career with a company winds up with a lot less retirement benefit than another who just happen to collect garbage for a city agency?

There are employers and not even small ones who provide absolutely no pension plans. A person retires from them after many years of service and gets nothing but a handshake.

Granted, nobody was forced to work for such businesses but as time goes by it becomes more and more difficult to change employers even when one realizes that there is nothing waiting at the end of the yellow brick road.

Bottom line and the View From the Bottom is that reduce these unfair and undeserved benefit packages and maybe the financial pictures might look a little better for everybody concerned.