Government Workers Earn 12% More Than Public Sector: Study

Government workers in Atlantic Canada are paid an average of nearly 12 per cent more than their private-sector counterparts.

That was one of the findings of a new study released Tuesday by the Fraser Institute, an independent think-tank.

“At a time when governments are facing serious fiscal pressures, bringing government sector compensation in line with the private sector would help reduce costs without necessarily affecting services,” Ben Eisen, a senior fellow with the Fraser Institute, said in a news release.

The study found the wages of government employees in Atlantic Canada are 38 per cent higher, on average, than wages in the private sector in 2021.

After adjusting for differences such as age, gender, education, tenure, type of work, industry, and occupation, government employees are still paid 11.9 per cent higher wages.

The study noted that government workers also enjoy more generous non-wage benefits than their private-sector counterparts, such as pensions, early retirement, and personal leave.

More than 70 per cent of workers in the public sector were covered by a registered pension plan, compared to fewer than 30 per cent of private-sector workers.

Government workers retired between 3.0 and 4.4 years earlier, on average, than their counterparts working in the private sector.

In 2021, full-time workers in the government sector were absent from their jobs for personal reasons between 15.2 and 16.5 days, compared to 9.3 to 11.3 days for private-sector workers.

And the rate of job loss was lower in the public sector (from 0.6 to 1.1 per cent) than the private sector (from 4.2 to 7.8 per cent).

Eisen said closing the compensation gap between the government and private sectors would reduce costs and can help ensure the long-term sustainability of government finances.

“It’s important that all levels of government in Canada — municipal, provincial and federal — continuously review expenditures with an eye to producing better value-for-money to taxpayers,” said Eisen.

You can view the full study by clicking here.