Belfast Telegraph

Public sector workers earn 40% more than private sector staff in Northern Ireland

By Adrian Rutherford

Public sector workers in Northern Ireland are earning 40% more than those employed in the private sector, a new report shows.

Although the pay gap has narrowed slightly, it is still more than double the difference elsewhere in the UK, prompting claims that it is neither sustainable nor affordable.

Private sector wages are also falling - again contrasting with other regions where there has been a rise.

The figures are revealed in the Northern Ireland Annual Survey of Hours and Earnings.

Other key findings include:

  • Average full-time earnings in Northern Ireland fell by 1.4%, but increased in the rest of the UK;
  • A typical full-time employee here has the lowest gross weekly earnings in the UK - just £457;
  • We also lag behind the rest of the UK in job creation, with the number of jobs rising by 2.1% last year compared to 2.4% elsewhere.

The report is part of a UK-wide survey of employers and is based on a 1% sample of jobs.

One of the main findings concerns the continuing chasm between public and private sector pay.

Now standing at 40.8%, the gap is far greater than in the UK overall, where public sector earnings are 17.3% higher.

Women in particular benefit in the public sector, earning 68% more than their private sector counterparts. For men the gap is 33%.

Northern Ireland's politicians have long championed a private sector-led economic recovery.

Nigel Smyth, who is Northern Ireland director of business lobby group the CBI, urged the Executive to get a handle on public sector labour costs, which now account for almost 60% of public expenditure in Northern Ireland.

"At a time of public expenditure constraint, and in the context of the recent draft budget 2015/16 outcome, it is concerning that the earnings differential between the public and private sectors continues to be so high," he said.

"This is neither sustainable nor affordable, and undermines efforts to rebalance the Northern Ireland economy.

"It also emphasises both the importance of the pay restraint the Executive has agreed in the draft budget and that we should be seriously considering regionalised rates of public sector pay."

Yesterday's report shows that weekly earnings for full-time employees in the private sector here fell by 0.9% to £405. Equivalent figures for the UK as a whole show a growth of 0.7% with private sector workers earning £493 on average.

The Northern Ireland-UK private sector pay gap has widened, with our private sector at 82.2% of the UK figure.

Paul Mac Flynn, an economist with the union-backed Nevin Economic Research Institute, said the weak private sector was the primary driver in the continued wage gap.

"We've had a significant deficit in private sector wages that has been evident for many years," he said.

"For all the growth - even during the good times - we never managed to make any progress towards closing the private sector Northern Ireland-UK gap.

"It is persistent and it's a misdirection to focus between the public and private sector in Northern Ireland."

He added: "There is always a gap between the public and private sector, and you can see that at UK level too.

"It's the fact that Northern Ireland's private sector lags so significantly behind the rest of the UK that makes the figures seem more alarming than they actually are."

Factfile

The Department of Enterprise, Trade and Investment attempts to explain the pay gap in the report. It notes the difference may be due to variances in the composition of the respective workforces. "Many of the lowest paid occupations, such as bar and restaurant staff, hairdressers, elementary sales occupations and cashiers, exist primarily in the private sector, while there are a larger proportion of graduate-level and professional occupations in the public sector," it states.

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