Accounting for the Cost of a Public Sector Worker in New Jersey

73 Pages Posted: 6 Sep 2018

See all articles by Eileen Norcross

Eileen Norcross

George Mason University - Mercatus Center

Roman Hardgrave

George Mason University

Date Written: September 2011


This study focuses on public sector benefits costs in the state of New Jersey. Along with several other states, New Jersey’s pension system is badly underfunded and health care and other benefits for public sector workers (known as Other Post Employment Benefits, or OPEB) are entirely unfunded.

The purpose of this study of New Jersey state and local employee compensation costs is not to determine if public sector workers are paid too much or to establish criteria for governmental efficiency. The focus is solely on whether governments are accounting for personnel costs in a way that enables governments to make informed policy choices that ensure retirement security for public servants, and a service-tax mix that reflects the demands of voters.

The policy implications of the increasing costs of public sector employees’ benefits are most keenly felt locally where vital services such as police and firefighters, safety services, road maintenance, and sanitation are delivered. By failing to fully account for and fund the cost of employee benefits, governments are increasingly faced with difficult budgetary choices.

Keywords: New Jersey, pensions, debt, retirement, public sector workers, benefits, budget

Suggested Citation

Norcross, Eileen and Hardgrave, Roman, Accounting for the Cost of a Public Sector Worker in New Jersey (September 2011). Mercatus Working Paper, No. 11-38, Available at SSRN: or

Eileen Norcross (Contact Author)

George Mason University - Mercatus Center ( email )

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703-993-4930 (Phone)

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Roman Hardgrave

George Mason University ( email )

4400 University Drive
Fairfax, VA 22030
United States

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