Topping-up government wages costs taxpayers $20B per year: CFIB

Federal, provincial or municipal employees make up to 37% more than someone doing the same job in the private sector.

March 23, 2015   by PLANT Staff

TORONTO — If you work in the private sector, you’re making up to $8,150 less per year, and working up to six hours more each week, than someone doing the same job for the government.

This is one of several key findings from the Canadian Federation of Independent Business’ latest Wage Watch report, pointing to a huge wage and benefits advantage for public sector workers over the rest of us.

When salaries, benefits and working hours are factored in, the average federal, provincial or municipal employee makes between 18 to 37% more than someone doing the same job in a private business.

The report finds that Canada Post workers and federal government employees are the biggest beneficiaries.

The report compares private sector employees to those at various government employers, and offers clear solutions to close the earnings gap between these workers, such as capping taxpayer-funded contributions to government pensions.

If government workers were paid at the same rate as their private sector equivalents, taxpayers would save $20 billion each year.

“The public-private wage gap is the elephant in every room when it comes to setting the public policy agenda in this country,” said Ted Mallett, chief economist and vice-president at CFIB. “Public sector earnings have been allowed to drift well above market-tested norms, and cash-strapped governments are looking for ways to invest in infrastructure and other priorities. Closing the gap is not just what’s fair, it’s what is needed.”

Based chiefly on National Household Survey (NHS) returns from 2011, the findings represent average full-time employment earnings for more than 7.2 million Canadians. Occupations that don’t exist in both sectors are excluded.

“Canadians in the private sector see their tax dollars paying for government wages and benefits that they can only dream of,” adds Mallett. “Policymakers need to start reigning in these misaligned costs.”

CFIB is Canada’s largest association of small- and medium-sized businesses with 109,000 members.

Find the full report here.

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1 Comment » for Topping-up government wages costs taxpayers $20B per year: CFIB
  1. Most taxpayers have been complaining about over taxation for several years,but it seems to fall on deaf ears. We, however , see our Governments getting bigger and bigger, with the addition of more and more excessive Public Service administrative bureaucrats.
    The CFIB, I believe have been trying to advise some of our elected Deputees, Ministers etc., but it seems that they do not have the power to direct the senior Public Servants (Non-elected).
    Small and Medium Sized Companies are finding it more and more difficult to operate and grow successfully under the burden of government taxation, regulation, and harassment.
    I, presently own two(2) Corporations, and have recently attempted to sell one of these Corporations to my Son. Much to my surprise, and disbelief, I was advised that ,if I sell to my Son ,then I would not be entitled to the Capital Gains Tax Exemption. If ,however, I sold to a foreign buyer then I would be able to claim the Capital Gains Exemption. As an honest hard-working Canadian Taxpayer, I find this absolutely revolting.
    We can do without many of these Senseless Bureaucrats.
    As a Member of CFIB, I ask that you look into this unacceptable Capital Gains Exemption situation, where bureaucrats are discourageing owners from keeping our Corporations within our Families.

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