The Determinants of State Employee Compensation

Abstract

Benefits are growing in importance for state employees and capturing an increasing proportion of the total compensation package. This investigation attempts to identify factors that account for variations across the states in individual and family health insurance contributions, pension benefits, paid leave, child and elderly care, and average salary. State employee union density was found to be the most consistent and important determinant of compensation. Cost of living was also predictive of some compensation factors. These findings contribute insights into an important and underresearched area of human resource management, but improved comparativemeasures of benefits are needed to aid future research.