Many public workers are overpaid relative to their private sector counterparts, especially in large, unionized states such as Wisconsin, Ohio and California. This may sound like a controversial claim, but it shouldn't. A consensus is building about the need for reform.

Nationwide, as governors and legislators seek to rein in labor costs, public-employee unions are protesting that their members are actually underpaid. But a growing body of evidence strongly suggests that their protests have no basis in fact.

Several studies have shown that public-sector workers receive higher compensation than their counterparts in the private sector. Although, federal contractors have some of the advantages of private sector workers, in that poor performers can be dismissed and the composition of the contractor workforce altered, it is possible that they are overcompensated just as federal employees are right now.

A January 2012 report by the Congressional Budget Office (CBO) shows that federal government employees receive substantially higher compensation than similarly skilled workers in the private sector. The report’s methodology and conclusions are broadly similar to previous studies from both The Heritage Foundation and the American Enterprise Institute.

It is a view as ubiquitous as it is simplistic: To improve public education, pay teachers more—a lot more. Union officials, education reformers, scholars, laypeople, and politicians of all stripes endorse this principle in one form or another.

The authors of the November 2011 Heritage Foundation report “Assessing the Compensation of Public-School Teachers” respond to questions and concerns, in the process showing that certain critical accusations—such as undercounting teachers’ work hours or overestimating retirement benefits—are simply false.

Shifting government workers to 401(k)-style plans would offer greater transparency and keep benefits in line with the private economy.

Public school teacher compensation is roughly 50 percent above private sector levels. In addition to merit pay, fundamental reforms to help schools hire, promote and fire teachers according to the best interests of students is needed.