It still pays to work for the public sector

Despite the austerity cuts and public sector redundancies, working for government still lines the pocket. Latest figures from the ONS show that the pay gap between the private and public sectors stands at 8%.

by Rebecca Burn-Callander
Last Updated: 19 Aug 2013

The Office for National Statistics has crunched the average hourly earnings of workers in the private and public sectors to work out who made more moolah in 2011. The answer is still the public sector, for the tenth year running (with only a decade of data to play with) with 8.2% more take-home pay.

The pay gap is a hard thing to calculate, however, because it is ruled by so many contributing factors. The ONS doesn't include pension contributions, health insurance or perks like company cars for example. The self-employed are also excluded from the survey, so the private sector wage bill doesn't take into account the 4.09 million odd earners in this bracket (be they high or be they low).

Interestingly, the Office for National Statistics have gone to some pains to stress that their pay gap statistics may not be an accurate reflection of real pay. It has even released a video highlighting the difficulties in processing the data. The survey is skewed because of the number of low-skilled workers in the private sector, it says. And pay is often commensurate with age and experience, it goes on to add, meaning that public sector workers, who are typically older, get larger salaries.

Do the statisticians protest too much?

Well, the onus is clearly on the ONS to prove to the cash strapped populace that the public sector isn't some bloated over-paying, under-working beast. Perhaps this explains the decision to keep the tax-payer owned banks, technically 'public sector' these days, in the 'private' sector for the sake of analysis?

And, on some levels, it may have a point. For example, a degree is widely held to boost your earning potential. In the public sector, 40% of the workforce held a degree or similar qualification in 2011, compared to 25% in the private sector. And then there's the outsourcing point: many of the low paid jobs in the public sector are shopped out to the private. This skews the figures and contributes to the wider spread of earnings in the private sector: the top 5% of private sector workers are paid around 5.7 times more than the bottom 5%. And that gap is lower in the public sector at 4.5 times.

But, despite all the rhetoric about ‘low-skilled’ and ‘young’ workers skewing results, the bankers’ salaries no doubt bump up the private sector average. So, dear ONS, pay equality between the public and private workers is still some way off…

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