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Public sector pay outstrips private sector


Those working in the public sector are earning an average of 14.5% more than those in the private sector according to the Office for National Statistics (ONS).

The average earnings for a public sector employee stood at £16.28 per hour in 2013, compared to an average of £14.16 for private sector workers.

However, it should be noted that the results were skewed by a variety of factors which included public sector workers generally requiring higher levels of skills and university degrees. Additionally, the ONS pointed out that employers in the public sector are generally bigger organisations, so tend to pay higher wages. Therefore, the figures outline why the public sector pays more on average than the private sector, rather than just how much more public sector employees earn.

The ONS said that: "Average pay levels vary between the public and private sectors because of the different jobs and characteristics of the people within each sector."

If you were to take this into consideration, you would actually find that the figures would paint a different story. For example, if you were to ignore the influence of factors such as skill requirements for a job, as well as factors such as age, experience, gender and location – then the pay difference would shrink to between 2.2% and 3.1%. Whilst this still shows that public sector workers earn more, the difference is considerably less than the 14.5% pay difference that appears to be the case.

Moreover, if you were then to consider the tendency for bigger employers to pay higher wages, coupled with the fact that public sector employers are generally bigger employers, the balance of pay actually shifts in favour of the private sector. With these factors taken into consideration you would then find that the private sector actually pays on average between 1.3% and 2.4% higher than employers in the public sector.

Higher Earner Differences

The results also showed that despite the public sector paying higher wages overall, the top earners from the private sector earned more than the top earners in the public sector.

For example, the top 5% of earners in the private sector earned an average of £33.63 an hour, in comparison to the top 5% of earners in the public sector who earned around £31.49 an hour.

Additionally, this trend was even further exaggerated in regards to the top 1% of earners in each group as the private sector outstripped the public sector, earning on average of £60.21 an hour in comparison to the public sector who earned an average of £49.65 an hour.

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