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Tuesday, 14th October 2014

Public Sector Pay in the UK

Source: Institute for Fiscal Studies (UK)

From Executive Summary:

In raw terms, pay levels are higher in the public sector than in the private sector. However, after accounting for differences in education, age and where workers live, the differences are much smaller. Among men, the average public sector pay differential in 2013–14 was close to zero, while among women it was around 8%.

Since the onset of the financial crisis, public and private sector pay trends have been quite different. Between 2008 and 2010, public sector pay grew relative to that in the private sector, a change that was not the intended result of policy. Private sector pay grew by around 1% (much less than the 5% growth in Consumer Price Index inflation over this period), while public sector pay grew by 4.5% (just below inflation). Since 2010, private sector pay has grown more quickly than in the public sector (although both fell in real terms). As a result, the gap that opened up during the crisis is, in 2014–15, almost back to where it was before the crisis started.

The Office for Budget Responsibility (OBR) forecasts that pay will continue to grow faster in the private sector than in the public sector over the next four years. If correct, this implies that the gap between public and private sector pay levels will fall back to levels last seen in the late 1990s and early 2000s, when there were recruitment and retention problems in parts of the public sector. OBR projections also imply further cuts to public sector employment levels, totalling one million between 2010-11 and 2018-19. Delivering both would involve substantial challenges to policymakers.

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Having begun his career in academic libraries, Adrian Janes has subsequently worked extensively in public libraries, chiefly in enquiry work as an Information Services librarian. In this role he has had particular responsibility for information from both the UK Government and the European Union. He wrote a detailed report on sources for the latter which was published by FreePint in 2007, and has contributed articles to FreePint and ResourceShelf. He is involved in training in information literacy and the use of online reference resources.

A Contributing Editor to DocuTicker, he also write reviews for Pennyblackmusic.

More articles by Adrian Janes »

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