Statement: “We’ve seen a 13.4 percent reduction in compensation in the past three years in the private sector in San Diego,” City Councilman Carl DeMaio said last week on KUSI.
Determination: Mostly True
Analysis: City officials face a more than $70 million budget deficit next year. City Councilman Carl DeMaio worked to defeat a sales tax increase on the November ballot and has now released his own plan for fixing city finances.
One DeMaio proposal would cut city workers’ wages. By reducing their pay now, the city would save money next year and reduce future pension bills.
To justify it, DeMaio has highlighted a decline in wages among local private companies, arguing that government should follow suit. Here’s the full context of his statement during an interview with KUSI.
We’ve seen a 13.4 percent reduction in compensation in the past three years in the private sector in San Diego. In San Diego city government, we need to make these adjustments so that we can bring our city’s labor costs in line with the local market and in doing so, help balance the budget in a more sustainable way.
DeMaio calculated the 13.4 percent decline using quarterly wage data from the U.S. Bureau of Labor Statistics. He adjusted each quarter for inflation and then compared the total amount of wages paid to San Diego County workers between the first quarters of 2007 and 2010. DeMaio explained this methodology on page 61 of his budget plan.
We independently reviewed the federal data and in fact, the 13.4 percent drop checks out.
We’ve called the statement mostly true, however, because there is an important detail to consider: DeMaio cherry-picked the largest incremental drop in the last decade that best supported his argument. Had DeMaio compared any other period, the difference would have been less stark — or even counter to his argument.
Over the last decade, the private sector and local government ended up with almost an identical drop in wages paid. Private sector pay fell by 3.4 percent between the first quarters of 2001 and this year. Local government pay fell by 3.6 percent during the same period.
Here’s an expanded version of DeMaio’s comparison, showing the first quarter total of each year since 2001:
And here’s a graphic showing total wages paid to local government workers in San Diego County during the same period:
So the strength of DeMaio’s argument relies on the time period he highlights. Since that’s an important nuance to consider alongside an accurate statistic, we’ve dubbed his statement mostly true.
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