Public sector employees in the north east, Merseyside and south west of England earn as much as £3,200 more than their equivalents in the private sector, according to analysis by think tank Policy Exchange.
Its report, which analysed the Office for National Statistics’ Labour force survey, published between January and March 2013, found that the average public sector worker benefits from a 6.1% pay ‘premium’, meaning that they can earn as much as £1,400 a year more than someone in the private sector, taking into account factors such as age, gender, full-time and part-time work, region, qualifications and length of employment.
This represents almost a 20% and 8% rise in the premium compared to the same quarters of 2007 and 2010 respectively.
It also found that, in central London, the East and South East, the average public sector employee receives less than their private sector equivalent.
The average premium has been relatively steady since mid-2010, suggesting that the Coalition government’s decision to freeze public sector pay is starting to re-alter the balance.
The report stated that variation in pay has risen because of the system of national pay bargaining, which means that workers are paid the same amount regardless of where they live.
It recommends:
- The abolishment of national pay deals and a move to a system that reflects local labour markets and rewards performance.
- The removal of automatic pay uplifts across the public sector.