Another Attack on Public Servants
Today’s National Post gave front page coverage to a “study” from the Frontier Centre claiming that wages of public servants have far outstripped those of private sector workers over the past decade.
“Wage increases doled out to federal and provincial public servants have nearly doubled those given to private-sector employees in the past decade, according to a new report that calls on governments to take a closer look at efficiency among their ranks of workers.
The Frontier Centre for Public Policy, an independent Prairie-based think-tank, analyzed the Statistics Canada reports for all 20 industries the national agency tracks and found that federal public servants’ wages rose by 59%, far outpacing the average worker. Provincial government workers came in at a close second with a 55% rise. Overall, wage growth for federal and public administrators dwarfs the 30% economy-wide weekly-wage growth, and shows the civil servants have seen faster boosts than any other industry.”
I got in a brief critical comment in the on line story, and my colleague Sylvain Schetagne has since gone through the tortured number crunchingÂ which delivered this highly misleading conclusion.
The study looks at wage growth using the average weekly earnings from the Employment, Hours and Payrolls survey (SEPH) of Statistics Canada.
This method fails to control for the number of hours worked in each industry. Clearly, average weekly earnings will rise faster than the average if the proportion of full-timers in an industry is high and rising, and if hours are on the increase. Conversely, average weekly earnings will rise more slowly in sectors where there is a high and rising proportion of part-timers.
When looking at the results of this study and trends in part-timers by industry using the Labour Force Survey, SylvainÂ found that six of seven industries at the bottom end of average weekly wage increases have seen an increase in the proportion of part-timers. At the other end of the spectrum, six out of seven industries at the top end in terms of increases in average weekly earnings saw a significant reduction in the proportion of part-timers. In fact, the proportion of part-timers in public administration was reduced by a third over that period of time, which contributes significantly to the increase in the average weekly wage over the decade, as workers were working more hours, not necessarily being paid a lot more per hour.
Moreover, a number of Statscan studies have shown that the incidence of unpaid overtime in the public sector is significantly higher than in the private sector. In 2009, 14.3% of public sector employees worked unpaid overtime, as compared to 11.4% of all employees.
The study also neglects to consider several reasonable explanations for a modest premium in public administration hourly wage growth compared to the average.
Some significant pay equityÂ adjustments took place in public administration during that period of time, and the workforce in public administration has been aging at a more rapid rate than average. Even in the private sector, more experienced workers generally command higher pay. And there has probably been an above averageÂ shift in the public administration job mix from clerical and other less skilled workers workers to highly educated professionals.
As for the alleged union effect highlighted by the Frontier Centre, it is true that public sector wage settlements did somewhat exceed private sector settlements over this period, but only by a small amount, and that after a decade in which public sector settlements lagged behind. (Private sector settlements averaged 2.5% 2000-09 compared to 2.8% in the public sector.)Â Private sector settlements are now running a bit above those in the public sector.