Highly-skilled staff earn more in the private sector

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date: 22 November 2011

embargo: 00.01hrs Wednesday 23 November 2011

Workers with degrees earn more in the private sector than the public sector, while staff with lower level and no qualifications earn more in the public sector, according to a TUC analysis of official statistics published ahead of the latest annual pay statistics out later this morning (Wednesday).

While comparisons of overall pay across the public and private sectors are meaningless given the different types of jobs in each sector, the TUC has examined pay levels broken down by qualification level as they provide the best possible comparator.

The TUC analysis shows that people educated to degree level earn 4.7 per cent more than public sector workers with the same level of qualifications, while employees without any qualifications earn 3.2 per cent less in the private sector.

The analysis also highlights a stark skills divide between the sectors, with public sector employees almost twice as likely to have a degree as workers in the private sector. Four in ten public sector staff have a degree - with the civil service and health sector professions such as physiotherapy and radiography increasingly requiring high level qualifications. The proportion of workers with no qualifications is twice as high in the private sector.

This skills divide has been driven by the growing number of specialised public sector jobs such as nursing and teaching, as well as the outsourcing of low-skilled public sector jobs such as cleaners and dinner ladies to the private sector, says the TUC.

While the terms and conditions of outsourced jobs are theoretically protected by TUPE regulations, the wages of workers in newly privatised jobs - the vast majority of which are done by women - are often reduced by private companies as they take on new staff, which increases both the public-private sector pay gap and the gender pay gap, says the TUC.

TUC General Secretary Brendan Barber said: 'The anti-public sector brigade has been guilty of some pretty misleading claims on public sector pay. The fact is that most public and private sector jobs are completely different and overall pay comparisons are meaningless, but it won't stop people using them to attack the pay of nurses, teachers and home care workers.

'But it is true that pay and benefits are fairer in the public sector, with all employees entitled to the same staff pension schemes and the gap between the highest and lowest-paid far smaller than in the private sector.

'While high-flyers with degrees can expect to earn less in the public sector, lower- skilled and lower-paid staff can expect a better deal in the public sector.

'For small-state fanatics to get their wish and bring the public sector into line with the private sector, the government would need to cut the wages of the poorest public sector workers and give huge pay rises to those at the very top. That kind of reform is unlikely to get much support from taxpayers.'

NOTES TO EDITORS:

Gross hourly pay (£), by sector and education level

Highest qualification

Private

Public

Degree or equivalent

18.49

17.66

Higher education

13.41

13.96

GCE A Level or equivalent

11.10

11.00

GCSE grades A-C or equivalent

9.49

10.29

Other qualifications

9.66

10.82

No qualifications

7.84

8.10

Overall

12.17

13.93

Profile of workers by qualification level (000s)

Highest qualification

Private

Public

Total

Degree or equivalent

3,968

3,076

7,044

Higher education

1,560

990

2,550

GCE A Level or equivalent

4,277

1,398

5,676

GCSE grades A-C or equivalent

5,105

1,434

6,539

Other qualifications

1,253

221

1,474

No qualifications

1,213

259

1,472

Don't know

100

13

112

Total

17,476

7,392

24,867

Proportion of workers by qualification level (per cent)

Highest qualification

Private

Public

Total

Degree or equivalent

22.7

41.6

28.3

Higher education

8.9

13.4

10.3

GCE A Level or equivalent

24.5

18.9

22.8

GCSE grades A-C or equivalent

29.2

19.4

26.3

Other qualifications

7.2

3.0

5.9

No qualifications

6.9

3.5

5.9

Don't know

0.6

0.2

0.5

Source: Quarterly Labour Force Survey, January-March 2011

- The Annual Survey of Hours and Earnings (ASHE) will be published by the Office for National Statistics at 9:30am today.

- The Transfer of Undertakings (Protection of Employment) regulations (TUPE) protect employees' terms and conditions of employment when a business is transferred from one owner to another. Further information is available at http://www.acas.org.uk/index.aspx?articleid=1655

- All TUC press releases can be found at www.tuc.org.uk

Contacts:

Media enquiries:
Liz Chinchen T: 020 7467 1248 M: 07778 158175 E: media@tuc.org.uk
Rob Holdsworth T: 020 7467 1372 M: 07717 531150 E: rholdsworth@tuc.org.uk
Elly Gibson T: 020 7467 1337 M: 07900 910624 E: egibson@tuc.org.uk

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