Public sector earns 25pc more than Private sector

Sleipnir

A report today in today's Indo.

How do you think the unions will react to this news from the ESRI?

My own opinion is that the cost of the public sector is now way beyond a joke and pay cuts are desperately needed.

If only useless public sector employees could lose their jobs. It's ridiculous that in this day and age, people who don't work are guaranteed their jobs while some in the private sector who work hard have no such guarantees! It's insane!

PUBLIC workers are now earning 25pc more than private sector employees, new figures reveal.

A new report by the State's economic thinktank published this week will reveal that the pay gap between public and private workers has widened dramatically.

The study by the Economic and Social Research Institute (ESRI) shows the average gap in earnings more than doubled from 9.7pc in 2003 to just over 21pc in October 2006.

When pensions are added in, the gap jumps a further 3pc -- to almost 25pc on average.

The report also shows the differential between the public and private sectors is higher in Ireland than in most other EU countries.

The findings will be seized upon by the Government, which is preparing to announce pay cuts for more than 300,000 civil servants, teachers, nurses, gardai, local authority staff, HSE and state body employees in the public sector.

The pay cuts will provoke a furious reaction from public sector unions.

But the Government has been left with little option as it desperately seeks to bolster the dwindling public finances, with almost three-quarters of state spending going on public sector salaries and social welfare.

Fianna Fail sources also indicated it would be slightly easier to "sell" reductions in social welfare allowances if they were accompanied by public sector pay cuts in the December Budget, which is being billed as the toughest yet.

The latest ESRI figures compare rates of pay in the civil service, education, health, defence, commercial and non-commercial semi-state bodies, and local authorities with pay in the private sector. Contrary to popular belief, the biggest pay gap is not at the top of the public service but at the lower end. In some cases, they earn up to a third more.

In other words, a typical Leaving Cert student going into the public service will earn considerably more than a student going into a similar job in the private sector.

Salaries

The ESRI study examines in detail salaries in the manufacturing, construction, wholesale, transport, financial intermediation, education (private), health (private) and other services -- and compares them with the public sector.

The sectoral analysis is carried out for both 2003 and 2006.

It updates and deepens research published at the end of last year by ESRI researchers Elish Kelly, Seamus McGuinness and Philip O'Connell.

The main differences in the new study are that it takes pensions into account and that it "drills down" deeper into more direct comparisons between employees in the two sectors. This allows for closer assessment of the extent to which wage differentials have changed over the three years.

The ESRI has shown that the pay gap widened as a result of the report of the benchmarking body, which recommended average rises of 8.9pc for the 138 public service grades examined.

The separate Review Body on Higher Remuneration in the Public Service had recommended a 7.5pc interim increase to basic salary for all the groups within its remit. Half of the increase recommended by the review body was paid out in July 2005 and the rest the following January.

Those salaries are again being reviewed for many at the top, including judges and politicians; and a further report, due shortly, is expected to recommend a reduction.

The ESRI is holding a research seminar at its offices in Whitaker Square, Sir John Rogerson's Quay, Dublin 2, at 4pm on October 8 on the theme: The Public-Private Sector Pay Gap in Ireland: What Lies Beneath?

http://www.independent.ie/national-news/pay-gap-widens-as-public-sector-earns-25pc-more-1891959.html