Great jobs apartheid: Public sector staff spend nine fewer years at work over lifetime than private employees AND earn 30% more



Public sector employees work nine years less than their private sector counterparts but are paid 30 per cent more, a bombshell report reveals today.

Extraordinary research tells a tale of two Britains - a state sector awash with taxpayers' cash while the rest of the economy struggles to stay afloat.

Public sector workers enjoy better pay than those in the private sector, as well as better pensions, shorter hours, and earlier retirement.



Deal: Public sector workers spend less time at work but earn more (file picture)

Over their lifetimes, those in the private sector work 23 per cent longer - equivalent to an extra nine years and ten weeks - than public sector employees. This is thanks to a combination of shorter hours, more time off and earlier retirement.

The findings explode once and for all the old idea that public sector workers have better job security and gold-plated pensions because they have lower salaries.

They will be seized on by the Coalition Government, which has warned that the bloated state sector has been artificially insulated from the recession and is in line for massive spending cuts.

The report, by centre-Right think tank Policy Exchange, also found that the chance of being made compulsorily redundant in the civil service is an astonishing 0.00007 per cent.



Generous pension schemes in the state sector are now worth up to 15 per cent on top of salary, the report says, while public sector pay costs have soared by more than a third in real terms over the last seven years - three times faster than in the private sector.

The report uses figures from the Office for National Statistics to show that more than seven million people are now employed in the public sector, over a million more than official figures suggest.

And £4billion more is spent on marketing, PR, customer service and office managers' jobs in the public sector than in 2002.

Policy Exchange director Neil O'Brien said: 'Under the last government the pay bill got totally out of control, increasing three times faster than in the private sector. Pay spiralled even though productivity was collapsing.

'We should freeze the public sector pay bill in cash terms for the next four years, taking the pay bill back to where it was in 2003 in real terms. We should also follow the example of Ireland and other European countries, and ask public sector workers to pay some more towards their pensions.'



The report says median gross pay is now £22,417 in the public sector and £19,932 in the private sector.



It adds that between 1997 and 2007 public sector productivity fell, while productivity in the private sector increased by nearly 28 per cent - leaving the former only two-thirds as productive as the latter.

Between 2002 and 2009, the number working in the public sector increased nearly five times more quickly than numbers in the private sector.

The report says that on an hourly basis, the typical public sector worker is 30 per cent better paid than their private sector counterpart.

Before 1997, when Labour came to power, private and public sector salaries rose at similar rates. But between 2002 and 2009, typical pay grew 86 per cent faster in the public sector, partly funded by additional public spending. Meanwhile, real earnings for private workers have been largely stagnant since 2002.

Between 1997 and 2008 the proportion of public sector workers without any pension provision from their employer fell from 21 per cent to 16 per cent. However, in the private sector the same figure rose from 54 per cent to 63 per cent.

While the proportion of public sector workers in generous defined-benefit schemes has risen, the number in the private sector has progressively declined - to just 8 per cent of the workforce compared to 80 per cent in the public sector by 2007.

The report says gold-plated public sector pensions - which have been targeted by the Government for cuts - are worth between an extra 12 per cent and 15.6 per cent of total salary. Ministers are next week expected to announce a major review of public sector pensions after the independent economic watchdog warned their cost will more than double by 2014.

Today's report also highlights the generous redundancy payments in the civil service. Civil servants over 50 qualify for compensation of three years' pay, funded by the taxpayer, while those who joined before 1987 can qualify for six-and-a-half years' pay, on top of their pensions.

TUC General Secretary Brendan Barber said it was 'impossible' to accurately compare private and public sector pay because of the higher number of skilled and professional workers and differences in the nature of jobs.

He said the report used 'deliberately misleading' figures and painted 'every nurse, every doctor, every teacher as a drag on the economy'.



