Study
| EST. READ TIME 2 MIN.Government workers across Canada receive 9.4% higher wages, on average, than comparable private-sector workers
Comparing Government and Private Sector Compensation in Canada, 2020
Main Conclusions
- Using data on individual workers from January to December 2018, this report estimates the wage differential between the government and private sectors in Canada. It also evaluates four non-wage benefits for which data are available to quantify differences in the compensations offered by the two sectors in these provinces.
- After controlling for factors like gender, age, marital status, education, tenure, size of firm, job permanence, immigrant status, industry, occupation, province, and city, the authors found that Canada’s government-sector workers (from federal, provincial, and local governments) enjoyed an 9.4% wage premium, on average, over their private-sector counterparts in 2018. When the wage difference between unionized and non-unionized workers is taken into account, the wage premium for the government sector declines to 5.8%.
- Available data on non-wage benefits suggest that the government sector enjoys an advantage over the private sector. For example, 87.7% of government workers are covered by a registered pension plan compared to 22.5% of private-sector workers. Of those covered by a registered pension plan, 90.8% of government workers enjoyed a defined-benefit pension compared to two in five (40.7%) of private-sector workers.
- In addition, government workers retire earlier than those in the private-sector—about 2.4 years earlier on average—and were much less likely to lose their jobs: 0.4% in the public sector compared to 2.4% in the private sector.
- Moreover, full-time workers in the government sector lost more work time in 2018 for personal reasons (14.6 days on average) than their private-sector counterparts (8.6 days).
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Milagros Palacios
Director, Addington Centre for Measurement, Fraser Institute
Milagros Palacios is the Director for the Addington Centre for Measurement at the Fraser Institute. She holds a B.S. in IndustrialEngineering from the Pontifical Catholic University of Peru and a M.Sc. in Economics from the University of Concepcion, Chile. Ms. Palacios has studied public policy involving taxation, government finances, investment, productivity, labour markets, and charitable giving, for nearly 10 years. Since joining the Institute, Ms. Palacios has authored or coauthored over 70 comprehensive research studies, 70 commentaries and four books. Her recent commentaries have appeared in major Canadian newspapers such as the National Post, Toronto Sun, Windsor Star, and Vancouver Sun.… Read more Read Less… -
Nathaniel Li
Senior Economist, Fraser InstituteNathaniel Li is a Senior Economist at the Fraser Institute. He holds a B.A. from the Fudan University in China anda Ph.D. in Food, Agricultural and Resource Economics from the University of Guelph. Prior to joining the Fraser Institute, he worked for the University of Toronto as a postdoctoral fellow and the University of Guelph as a research associate. His past research work has been published in many high-quality, peer-reviewed academic journals, including the Applied Economic Perspectives and Policy, Agricultural Economics, Preventive Medicine, and Canadian Public Policy. His current research covers a wide range of issues in fiscal, education, and labour-market policies.… Read more Read Less…
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