Are public sector workers overpaid?
By Gordon Powers, Sympatico / MSN Finance
As the economy continues to crumble, the debate surrounding provincial and municipal governments’ ability to set wages at an appropriate level is really heating up. And one of the really hot issues is the growing compensation gap between public- and private-sector jobs.
According to the Canadian Federation of Independent Business, public-sector workers across Canada earn 8 per cent to 17 per cent more than people with similar jobs in the private sector. When shorter work weeks and other benefits are taken into account, the number rises to more than 30 per cent.
The public-sector wage advantage is now 11.9 per cent for municipal workers, 7.9 per cent for provincial workers and 17.3 per cent for federal workers. On average, the annual pay of provincial employees is $52,863 while that of equivalent private sector workers is $49,002, according to CFIB data.
The findings of this latest study not only confirm previous research, but suggest that governments as a group are losing control of their employment costs — particularly benefits — thus forcing taxes up unnecessarily, the CFIB argues.
Critics of the study, while acknowledging that a wage gap does exist, suggest the disparity is based on the strengths of unionization, not on red-herring distinctions between public versus private.
In fact, the real issue – what constitutes a fair wage for Canadians – gets lost in the shuffle, says Winnipeg Free Press columnist Dan Lett: “To buy into the CFIB argument that public-sector wages are overly generous, you'd have to accept that the lower private-sector wages it espouses provide workers with a real living. And that's just not true.”
Most Canadians are falling further and further behind in their desperate bid to keep up to the cost of living. If there's an argument for tax relief, it’s at the bottom-most rungs of the income tax system, he says, maintaining that the problem lies not with public sector costs but with the cut-price wages paid by the CFIB’s constituents.
What do you think: Are public sector workers overpaid?
Posted by: Ron | Jul 17, 2021 9:35:57 AM
I have found in many years of working in the private sector and dealing daily with private and public sector workers that the public sector workers are usually a bit boastful about the fact they work less, have more time to go to the lake or whatever, and are paid very well for what they do. As an observation, however, most public sector workers I've met do not appear as happy, complain a lot more, and can't wait for retirement.
Posted by: Privat Wurkur | Jul 17, 2021 9:37:10 AM
Yes I believe public sector workes are overpaid. However I believe it is perks and the fact they feel entitled to everything they get that is a major issue with we private sector folks. It is the 37.5 hour work week, the birthdays off, the sick day accumulation they can use to retire early, the fully indexed pensions, the gold plated benefit package even after retiring, and so on and so on. If all of this is not enough you see their union bosses on TV holding out for even more and sending their uneducated, unskilled workers to the picket line ( garbage handlers in TO ) to demand it when others in the real world watch their companies lay off or worse close down all together.
Posted by: Claudio Cassol | Jul 17, 2021 9:40:14 AM
We always criticize those who earn more. There should be stronger unions for the private sector, to bring them to the same level as the public sector. Give everyone a chance to improve their lot.
Posted by: Spuck | Jul 17, 2021 9:43:24 AM
Public Sector Employees not just they earn a lot more, they have more benefits and they work a lot less, and we the rest of working Canadians pay them with continuos taxes increases.
Some politicians go overboard without any consideration for the paying taxes payers by increasing their wages as they pleased.
Posted by: J.B | Jul 17, 2021 9:49:15 AM
I am a public sector worker and I have to agree that SOME public sector employees are paid too much. I find it insulting that a person with no education and no skilled trade (ex. TTC driver or TO Garbage collection) gets paid more than me and I literally save lives everyday. To make matters worse...those same public sector workers dare to go on strike in the midst of a recession when thousands of people are losing their jobs and would give their eye teeth to jump into their position?! Who do they think they are? I cannot go on strike for more money or a better sick day or vacation plan...I am considered an "essential service". So please be careful not to paint all public sector workers with the same brush. It is not apples and oranges when you compare Garbage workers and bus drivers with Healthcare professionals who save people's lives on a daily basis and aid them through some of the most difficult times in their life.
Posted by: T.Harris | Jul 17, 2021 9:50:32 AM
No I don't think so,although in general they should be more productive.I have to agree with Winnipeg columnist Lett,that the private sector is underpaid for the realities of our western economies.As well,the business world generally discourages unionization and shuns the perceived burdens of full time employees.I've always had an issue with the hospitality industry for example,paying substandard wages in the knowledge that the customer will top up workers with gratuities.
Posted by: J.B | Jul 17, 2021 9:53:04 AM
Also, I don't think private sector should complain, they knew what they were getting into. If they wanted benefits and sick days then they should have entered the public sector instead. When you make your own bed....I'm just saying. I knew I wanted a 37.5 hr work week with benefits and sick time and paid vacation. So...I went to school and entered the public sector. You choose the profession that suits the lifestyle you prefer. Just because you didn't make the choice early on...don't blame us.
Posted by: . | Jul 17, 2021 10:00:09 AM
I dont think Public workers are over paid, I think the Private workers are the ones that are way under paid. It took a long time for the public sector to get what they get today. A lot of fighting for not just for them to have a good life but for the future workers to get a decent life. when a president of a company/politian/CEO could give themselves a 40% pay hike then they can afford to give their workers 3-4% more of there wages but they claim they can't, Well if you can't then don't give yourself a huge raise like that.
Posted by: Denise | Jul 17, 2021 10:01:44 AM
No, I do not think that the public sector worker earns too much but I do agree that many private sector workers do not earn enough to provide a decent living.
Posted by: Phil | Jul 17, 2021 10:04:08 AM
I'm a member of the Canadian Forces, therefore I'm considered a Federal public servant. I can state categorically that my employer doesn't pay me nearly enough to put up with the crap I have to put up with on a daily basis. Leaving my wife and kids at home while they wonder if I'll ever come back from a tour of duty. Getting shot at by people I don't know, tiptoeing around land mines and roadside bombs, feeding hungry people in 50 degree African heat, etc, etc, etc. I do this type of work to serve my country and make the world a better place. I definitely don't do it for the money. It really bothers me when I hear all the pissing and moaning from other public servants - cry me a river why don't you. Come and walk a mile in my shoes and you'll see what it's like to be overworked and underpaid.
Posted by: Daniel | Jul 17, 2021 10:05:00 AM
First of all, I'm an engineer in Alberta, my provincial association carefully takes in detailed statistics on wages for all types of engineers and the government ones which are in a minority definitely do not make more money than the private sector engineers especially those in oil and gas. I think all things being equal the civil servant should make less money for the same job (which can be hard to compare at times); because they tend to have more job security. Certain professions like police officers, teachers, professors at universities, etc. almost never lose their jobs. I've been laid off more than once and in my business people are only there if it is profitable and we can get charged out to the customer. I dislike the civil service unions because they don't act in the best interests of the public, overpay unskilled labourers with no checks and balances whatsoever, and nothing to make Canada more competitive. Not brought up in the article is the *TOTAL* compensation package for government employees lots of them still have cushy, expensive defined benefit pensions and that's very inequitable.
Posted by: Nancy | Jul 17, 2021 10:06:58 AM
Public sector workers are not necessarily the culprits. As mentioned in the article it depends on the strength of the union representing them. There was a day when unions were necessary to protect workers but that time is long gone. Now the unions are just power hungry and a detrement to our economy. We have labour standards today that we did not have years ago and the unions are no longer required.
Posted by: . | Jul 17, 2021 10:18:37 AM
unions will proably never go away. its a profitable business when you think about it. you pay what about min 100 I am a part time worker and when I replace I become a temp full time so I pay 42$ for union dues about, so lets say an accual full time with benifits etc pays about 100 again per pay.
Now you have 5000-10000 full time workers paying that 100 thats 500000 to 1000000 every pay. thats 26 million a year if you have 10000 workers at 100 every two weeks, wouldn't you fight tooth and nail for the people who are keeping your business running for you?
I also think that people pay more then that in union dues.
Posted by: Terrance Burke | Jul 17, 2021 10:29:22 AM
I think Canada has become a socialist Country. We are in a global economy. We cannot compete by lowering the value of our currency. We must learn to be more productive with less money. The public sector is in shambles. I suggest you read this real;ity concept.
http://ca.groups.yahoo.com/group/afocusonreality/
Posted by: AV | Jul 17, 2021 10:31:54 AM
I am a public sector worker and my market value in the private sector is about 2x what i am earning here. Hence, I am looking for work in the private sector.
Posted by: Spaz | Jul 17, 2021 10:38:28 AM
I agree with post July 17 10:00:09 a.m.
It's not that public sector worker's are overpaid, it's that private sector workers are underpaid. Instead of complaining about what other people make we as Canadians need to use them as examples in the private sector to increase these workers wages and benefits. EVERYONE DESERVES A DECENT WAGE. Start up a union, my friend did at his place of work.
July 17 9:53:04 a.m.
I am in agreement with this post. If you work in the private sector you knew what you were getting into. If the grass is greener on the other side, climb the fence and play in that yard.
Stop the atrocity of C.E.O's, managers etc. giving themselves bonus after bonus and having their worker ants work for pennance.
Posted by: The grass is always greener | Jul 17, 2021 10:40:32 AM
My man is a Gravel truck driver in the summer and plow truck driver in the winter in the public sector. We are in Northern Alberta and I can tell you that he had to take a serious pay cut from the private sector when he took the job. He does not get birthdays off. He does not get more than three sick days a year. He works 10 1/2 hours a day five days a week and often has to work over-time on top of that. The only real benefit is that he can pay into a pension for retirement in lets just say 30 years, he get decent health benefits, and he is no longer affected by the seasonality of his job. He is not unionized so not all public sector employees are unionized.
There is a lot of misconception out there about the public sector. There are different situation for ever area, so it cannot be blamed for all the problems.
Posted by: Michael | Jul 17, 2021 10:43:49 AM
Most public employees are way too overpaid. And who pays for their generous salaries and benefits? We, the taxpayers.
Posted by: baljit j | Jul 17, 2021 10:50:45 AM
I personally think once you are in public sector you got it made reason all the managers are not accountable how they spend taxpayers money its our democratic system responsible for that plus your output never in question take a look at toronto civic workers
Posted by: Harvey | Jul 17, 2021 10:53:00 AM
No one who works is ever over paid. Wages are based on the fair market value when contracst are negotiated. We should all strive to help increase the wages for all hard working people