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CSO report on public-private pay gap

Geuze

CSO study of the pay gap published today:

http://www.cso.ie/en/media/csoie/releasespublications/documents/earnings/2010/nes_0910supp.pdf

Press release:

http://www.cso.ie/en/newsandevents/pressreleases/2012pressreleases/pressreleasenationalemploymentsurvey2009and2010supplementaryanalysis/

Main findings:

Overall, the summary results show that, on average, public sector employees had higher educational attainment, longer service, were older, and were more likely to be in professional jobs than their counterparts in the private sector.

The multivariate analysis provided a range of estimates of the public/private pay gap. The range of estimates provided reflect the fact that there is no unanimity in the international literature regarding the most appropriate model/parameters to use and as such no single best measure exists and to present one would be subjective and prone to over simplification. The pay gap estimates ranged from 6.1% to 18.9% for NES 2010 and all estimates showed a reduction in the pay gap between 2009 and 2010.

People often mention a 50% pay premium, which is clearly wrong. Now we know that it's more like 6-18%, depending how it's measured.

NB: the analysis does not take into account the second PS pay cut (PRD). This was about 6-8%.

So the pay premium is now about 0-10%.

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flintash

barneystinson wrote: »

Tut, too lazy to Google "junior doctor working hours" eh?.....still not happy.

Is this happening in HSE department?
I though they cant make people do acctual work there, never mind 120hours

relax dude, reading too much newspapers, uh?

p.s. (off-topic) run and buy a house - prices are rising again

Peace

OMD

Godge wrote: »

OMD wrote: »

Are you saying the vast majority of PS workers do not have a final salary of less than €50,000? Please provide proof. The average salary is above 40k so common sense dictates final salary will be above 50k. It is final salary that counts

Just thinking about this again. Are you saying the state old age pension is €24,000 a year?

No he wasn't. What he said was the spouse's pension is half the public servant's pension which is therefore a quarter of salary.

Sorry about that. Of course it is half but it still applies to the majority rather than the minority as the previous poster made out.

OMD

Godge wrote: »

OMD wrote: »

Do you understand PS pensions?
Do you think the pension board link can calculate the equivalent of a PS pension?
If you do then you seriously do not understand pensions.
From your comments I presume you cannot/will not answer the previous questions

I don't think you understand pensions either. Public servants have a new pension scheme. Have a read of the Trident report on this site.

http://www.into.ie/pensions/

I know it is a union report but since the report was commissioned there have been further cuts in pay for new teachers.

some interesting quotes in relation to the new scheme

"15) We have tested the new proposals across various scenarios and the following

profiles are among those which would pay more in than they would get out of

the new scheme:

a) age 21 joiner, no promotion, unbroken service;

b) age 21 joiner, Special Duties post at age 40, unbroken service;

c) age 25 joiner, no promotion, unbroken service;

d) age 25 joiner, no promotion, 5 year career break."

Right so. Just out of curiosity. Of all the current Public sector workers and all the current PS pensioners to what percentage does this apply? Just a rough figure. Seeing as you say I don't understand public sector pensions that apply to the enormous majority of PS workers current and past.

barneystinson

flintash wrote: »

Chris_5339762 wrote: »

I would add to that the public sector junior docs, registrars, etc etc who are similarly working absolutely ridiculous hours that are expressly forbidden under the working time directives. eg: Surgery trainees doing up to 120 hours per week and not getting a bit of overtime for any of it over their standard 35,37 or whatever contract.

31 hours does seem quite low though. Most contracts that I'm aware of are 35 hours over 7 days, 8am - 8pm rostering. If the AVERAGE is 31, what have they included? Are part timers thrown into that average? Are there people on ridiculously short contracts?

really? so he's 48 hours left in a week to sleep. Make me believe it:D

Tut, too lazy to Google "junior doctor working hours" eh?
Well here's one of the first hits, and it's as recent as 2 months ago: http://www.irishtimes.com/newspaper/letters/2012/0809/1224321806412.html

"Recently I spoke to a young doctor in a busy hospital who commenced work that day at 8.30am and was having her first break at 11.10pm as she took a call from me. The only food available to her was a bowl of cereal. She was on duty for the rest of the night and the following day and was expected to work more than 100 hours that week."

Now you may say, sure that's only anecdotal evidence from a letter to the Irish Times, in which case I'd say the letter is signed so feck off and ask yerwoman who wrote it what the name of the doctor in question is, if you're still not happy.

OMD

cosbloodymick wrote: »

The elephant in the room is the state pension of circa 12k per annum that public sector workers are not entitled to. This pension is paid to all citizens of this state bar public sector workers (the non contributary pension is slightly less) whether they have worked or not. So this figure should be subtracted from any calculation of the value of a public sector pension.
For example if a public sector worker retires on a salary of 36000 his/her pension would be 18000 per annum. 18000 - 12000 = 6000.
For this 6000 per annum the public sector worker has to contribute at least 15% of salary for 40 years. That would be equal to 5400 x 40 = 216000.
If a person paid 216000 into a private pension fund you would expect a return of 11000 per annum. yet in effect the public sector worker only gets 6000. No wonder some public sector workers want to opt out of the pension scheme but unfortunately cannot. Its compulsory!

Your figures are wrong for 2 reasons. You are not including the lump sum if up to 1.5 times final salary.

You are also assuming if the person retires on €36,000 that they actually earned that all their working lives. This applies to no public servant. By doing this you are ignoring inflation, pay rises and pay increments and promotions. So the figures you supply are totally wrong.

In addition the 15% pension contribution while actually closer to 13%, only applies to the last 4 years. So someone returning now would not have paid this for the vast majority of their working lives. For most if the time they would have paid 6.5%.

Anyway future PS retirees will be entitled to the PRSI pension. Current ones are not because they did not pay enough PRSI.

flintash

Chris_5339762 wrote: »

I would add to that the public sector junior docs, registrars, etc etc who are similarly working absolutely ridiculous hours that are expressly forbidden under the working time directives. eg: Surgery trainees doing up to 120 hours per week and not getting a bit of overtime for any of it over their standard 35,37 or whatever contract.

31 hours does seem quite low though. Most contracts that I'm aware of are 35 hours over 7 days, 8am - 8pm rostering. If the AVERAGE is 31, what have they included? Are part timers thrown into that average? Are there people on ridiculously short contracts?

really? so he's 48 hours left in a week to sleep. Make me believe it:D

Head The Wall

cosbloodymick wrote: »

The elephant in the room is the state pension of circa 12k per annum that public sector workers are not entitled to. This pension is paid to all citizens of this state bar public sector workers (the non contributary pension is slightly less) whether they have worked or not. So this figure should be subtracted from any calculation of the value of a public sector pension.
For example if a public sector worker retires on a salary of 36000 his/her pension would be 18000 per annum. 18000 - 12000 = 6000.
For this 6000 per annum the public sector worker has to contribute at least 15% of salary for 40 years. That would be equal to 5400 x 40 = 216000.
If a person paid 216000 into a private pension fund you would expect a return of 11000 per annum. yet in effect the public sector worker only gets 6000. No wonder some public sector workers want to opt out of the pension scheme but unfortunately cannot. Its compulsory!

Another way to look at this is seeing as Private sector and public sector both make social contributions to the govt for pensions they are the ones getting a raw deal. Why do people that get a non contributory pension receive nearly the same as someone that has contributed most of their life.

Godge

OMD wrote: »

Are you saying the vast majority of PS workers do not have a final salary of less than €50,000? Please provide proof. The average salary is above 40k so common sense dictates final salary will be above 50k. It is final salary that counts

Just thinking about this again. Are you saying the state old age pension is €24,000 a year?

No he wasn't. What he said was the spouse's pension is half the public servant's pension which is therefore a quarter of salary.

Godge

OMD wrote: »

Do you understand PS pensions?
Do you think the pension board link can calculate the equivalent of a PS pension?
If you do then you seriously do not understand pensions.
From your comments I presume you cannot/will not answer the previous questions

I don't think you understand pensions either. Public servants have a new pension scheme. Have a read of the Trident report on this site.

http://www.into.ie/pensions/

I know it is a union report but since the report was commissioned there have been further cuts in pay for new teachers.

some interesting quotes in relation to the new scheme

"15) We have tested the new proposals across various scenarios and the following

profiles are among those which would pay more in than they would get out of

the new scheme:

a) age 21 joiner, no promotion, unbroken service;

b) age 21 joiner, Special Duties post at age 40, unbroken service;

c) age 25 joiner, no promotion, unbroken service;

d) age 25 joiner, no promotion, 5 year career break."

ardmacha

So this figure should be subtracted from any calculation of the value of a public sector pension.

But if people starting doing calculations like this it would derail entire threads!

cosbloodymick

The elephant in the room is the state pension of circa 12k per annum that public sector workers are not entitled to. This pension is paid to all citizens of this state bar public sector workers (the non contributary pension is slightly less) whether they have worked or not. So this figure should be subtracted from any calculation of the value of a public sector pension.
For example if a public sector worker retires on a salary of 36000 his/her pension would be 18000 per annum. 18000 - 12000 = 6000.
For this 6000 per annum the public sector worker has to contribute at least 15% of salary for 40 years. That would be equal to 5400 x 40 = 216000.
If a person paid 216000 into a private pension fund you would expect a return of 11000 per annum. yet in effect the public sector worker only gets 6000. No wonder some public sector workers want to opt out of the pension scheme but unfortunately cannot. Its compulsory!

woodoo

Vizzy wrote: »

And what is more comical is that if you look at posts on Boards about 12 months ago they speak of a differential of 45% but over the last month or so this has been widened to 50%.
Now it appears that the actual difference is closer to 10%.
But don't let that get in the way of a good PS bashing argument.

I'm glad that CSO data was released. It shows that much of what we have been reading over the past few years in the media and on places like boards.ie, politics.ie etc have been wrong.

At a quick glace over that report it looks like the PS is paid about 10 to 15% more than the private sector. But this seems to be due to the higher education achieved by PS workers, a higher number of professional qualifications in the PS. And most worryingly of all the private sector seems to be stuck in the last century in terms of sexism and low pay for women.

Vizzy

woodoo wrote: »

I'm glad i'm never going to have to see that ridiculous 50% figure anymore. I knew all along it was tripe.

Next false fact up to be torn down is the 70% to 80% of the health budget is on wages.

Slowly but surely a mockery will be made of all the Sunday Indo type lies and spin.

And what is more comical is that if you look at posts on Boards about 12 months ago they speak of a differential of 45% but over the last month or so this has been widened to 50%.
Now it appears that the actual difference is closer to 10%.
But don't let that get in the way of a good PS bashing argument.

woodoo

I'm glad i'm never going to have to see that ridiculous 50% figure anymore. I knew all along it was tripe.

Next false fact up to be torn down is the 70% to 80% of the health budget is on wages.

Slowly but surely a mockery will be made of all the Sunday Indo type lies and spin.

OMD

kceire wrote: »

OMD wrote: »

No it doesn't. How the hell can it? The vast majority of people today have no idea what their final salary will be. It doesn't allow for a tax free lump sum on retirement. It cannot calculate spouses pension as it cannot allow for final salary. And it cannot assess my other questions either. So will you answer the questions or just post other pointless links

Doesn't suit your argument ehh
If you don't wana use the link, then don't.

Try remain calm, don't want to have you to endure a visit to a PS hospital with high blood pressure now do we

Do you understand PS pensions?
Do you think the pension board link can calculate the equivalent of a PS pension?
If you do then you seriously do not understand pensions.
From your comments I presume you cannot/will not answer the previous questions

Head The Wall

kceire wrote: »

There ya go, knock yourself out : http://www.pensionsboard.ie/en/Pensions_Calculators/

It's a rhetorical question(statement). The amount of the pension contributions is irrelevant as it isn't taken into account for public or private.

Gumbo

OMD wrote: »

No it doesn't. How the hell can it? The vast majority of people today have no idea what their final salary will be. It doesn't allow for a tax free lump sum on retirement. It cannot calculate spouses pension as it cannot allow for final salary. And it cannot assess my other questions either. So will you answer the questions or just post other pointless links

Doesn't suit your argument ehh
If you don't wana use the link, then don't.

Try remain calm, don't want to have you to endure a visit to a PS hospital with high blood pressure now do we

ardmacha

NB: the analysis does not take into account the second PS pay cut (PRD). This was about 6-8%.

So the pay premium is now about 0-10%.

Or rather was in 2010. Over the life of the CPA private pay will increase moderately and so the gap will end up as -5% - +5%.

OMD

kceire wrote: »

Yes it does :

No it doesn't. How the hell can it? The vast majority of people today have no idea what their final salary will be. It doesn't allow for a tax free lump sum on retirement. It cannot calculate spouses pension as it cannot allow for final salary. And it cannot assess my other questions either. So will you answer the questions or just post other pointless links

OMD

Kristopherus wrote: »

A PS does not get a pension for his wife & kids. His widow will get a pension of max 50% of his pension. That 50% will, in most cases, be less than the current widows pension. A PS would have to have a final salary of c.€48000.00 in order for his widow to have a pension in excess of what she would get from the state.The vast majority of PS have a salary of less than €50.000.00.

Are you saying the vast majority of PS workers do not have a final salary of less than €50,000? Please provide proof. The average salary is above 40k so common sense dictates final salary will be above 50k. It is final salary that counts

Just thinking about this again. Are you saying the state old age pension is €24,000 a year?

Gumbo

OMD wrote: »

That doesn't calculate final salary pension. What

Yes it does :

** Target Pension as % of Pre-Retirement Salary

Just select 50%

It also allows for 50% spouse pension :

Allow for 50% spouse's pension on death?

Kristopherus wrote: »

A PS does not get a pension for his wife & kids. His widow will get a pension of max 50% of his pension. That 50% will, in most cases, be less than the current widows pension. A PS would have to have a final salary of c.€48000.00 in order for his widow to have a pension in excess of what she would get from the state.

+1

But some posters up above would make out that PS people pay no pension contribution, no pension levy, and would make it seem that PS get their own pension, and pensions for their wives and kids.......

Kristopherus

A PS does not get a pension for his wife & kids. His widow will get a pension of max 50% of his pension. That 50% will, in most cases, be less than the current widows pension. A PS would have to have a final salary of c.€48000.00 in order for his widow to have a pension in excess of what she would get from the state.The vast majority of PS have a salary of less than €50.000.00.

OMD

kceire wrote: »

OMD wrote: »

But if the private sector worker wanted to get the same pension entitlements, ie pension of 1/80 final salary (remember final salary) per year worked and 3/80 final salary X years worked lump sum. Plus a pension for his wife and kids. How much would he have to pay?

While you are at it how much extra would he have to pay into a permanent health insurance plan to get the same sick leave benefits as a PS worker.

Oh yeah and how much extra to get the equivalent of the in service death benefit?

Oh one final thing. Does pay include allowances?

There ya go, knock yourself out : http://www.pensionsboard.ie/en/Pensions_Calculators/

That doesn't calculate final salary pension. It doesn't calculate tax free lump sum. Obviously it doesn't answer my other questions either.

What was the point of the link?

Gumbo

OMD wrote: »

But if the private sector worker wanted to get the same pension entitlements, ie pension of 1/80 final salary (remember final salary) per year worked and 3/80 final salary X years worked lump sum. Plus a pension for his wife and kids. How much would he have to pay?

While you are at it how much extra would he have to pay into a permanent health insurance plan to get the same sick leave benefits as a PS worker.

Oh yeah and how much extra to get the equivalent of the in service death benefit?

Oh one final thing. Does pay include allowances?

There ya go, knock yourself out : http://www.pensionsboard.ie/en/Pensions_Calculators/

OMD

Geuze wrote: »

Note that most PS pay a pension cont, plus the recent PRD. So, overall, the normal pension cont plus the PRD exceeds the typical cont of a non PS.

But if the private sector worker wanted to get the same pension entitlements, ie pension of 1/80 final salary (remember final salary) per year worked and 3/80 final salary X years worked lump sum. Plus a pension for his wife and kids. How much would he have to pay?

While you are at it how much extra would he have to pay into a permanent health insurance plan to get the same sick leave benefits as a PS worker.

Oh yeah and how much extra to get the equivalent of the in service death benefit?

Oh one final thing. Does pay include allowances?

Riskymove

Chris_5339762 wrote: »

Are part timers thrown into that average? Are there people on ridiculously short contracts?

ALL PS are included so yes, all sorts of part time and contract work included

Head The Wall

Geuze wrote: »

Note that most PS pay a pension cont, plus the recent PRD. So, overall, the normal pension cont plus the PRD exceeds the typical cont of a non PS.

That's not really relevant though, it has been left out so a proper comparison can be made against Private sector wages.

Head The Wall

Well, obviously they didn't and don't forget the private sector pension levy as well.

It's good to see that they actually Gross wages for proper comparisons, so many PS posters here use net figures.

Geuze

Note that most PS pay a pension cont, plus the recent PRD. So, overall, the normal pension cont plus the PRD exceeds the typical cont of a non PS.

OMD

Geuze wrote: »

CSO study of the pay gap published today:

NB: the analysis does not take into account the second PS pay cut (PRD). This was about 6-8%.

So the pay premium is now about 0-10%.

And how did they address private sector pension contributions.