Fiscal Federalism X: Federal Salaries and Wages

Following on my five previous blogs (Procurement, Grants to State and Local Governments, Other Direct PaymentsRetirement and Disability and All Federal Spending) . . . this blog shows federal “salaries and wages” spending as percent of personal income. What is this?

According to the Consolidated Federal Funds Report (pdf) from which this data is drawn from, “salaries and wages” constitute federal dollars that are used for:

  • Department of Defense personnel
  • U.S. Postal Service employees
  • U.S. Coast Guard personnel
  • Office of Personnel Management which manages all civilian employees except the Central Intelligence Agency, Defense Intelligence Agency, and the National Security Agency

The table below shows the wide range of federal “salaries and wages” dependency by state. The states that are most dependent are: Hawaii (8.5 percent), Alaska (8.0 percent), Virginia (4.7 percent), Maryland (4.4 percent) and Kentucky (3.5 percent).  Of note is the District of Columbia at 49.2 percent.

On the other hand, the states that are least dependent are: Connecticut (0.9 percent), New Jersey (1.1 percent), Wisconsin (1.1 percent), New York (1.2 percent) and Michigan (1.2 percent).

This is the last major federal spending category published in the CFFR.  Next we will turn our attention to looking at these categories over time–which has seen the largest percentage increase in federal spending?  Stay tuned.

Federal Spending on Salaries and Wages as a Percent of Personal Income by State for 2008