Public Sector Workers 'paid More'

[737]

http://news.bbc.co.uk/1/hi/business/4683879.stm

An odd state of affairs and not, in my opinion, the sign of a healthy economy!

[BandWagon]

http://news.bbc.co.uk/1/hi/business/4683879.stm

An odd state of affairs and not, in my opinion, the sign of a healthy economy!

<{POST_SNAPBACK}>

Yep, Gordon Brown is gearing up to publicly spend his way out of the coming recession.

What I'd like to know is where the money's going to come from, higher tax is a certainty, but what happens to interest rates when the goverment decides they need to borrow more money?

Time will tell.

[Bluelady]

Where's the evidence? What did they research? How many jobs in each sector did they look at? And at what levels? Anyone can say this kind of thing, showing how you reached those conclusions is another. And they haven't provided anything to support it at all.

[737]

Where's the evidence?  What did they research?  How many jobs in each sector did they look at?  And at what levels?  Anyone can say this kind of thing, showing how you reached those conclusions is another.  And they haven't provided anything to support it at all.

<{POST_SNAPBACK}>

They surveyed 5,900 managers.

And there's more

Most (public sector workers) are also still scheduled to retire at 60 on guaranteed salary-related pensions. Plans to bring public servants’ retirement dates in line with the rest of the country were cynically abandoned just before the election. That move is reckoned likely to cost local authorities alone an extra £400 million a year and the longer-term cost of widening the gap between public and private is incalculable.

Given their greater security and higher pay, it is perhaps not surprising that public-sector workers are still relaxed enough about their employment prospects to take nearly twice as many sick days as private-sector workers, without much evidence that one group is sicker or healthier. In business, the bias is to work longer and take less time off.

Edited July 15, 2005 by 737

[okonu]

http://www.cipd.co.uk/press/PressRelease/press_15_07_05.htm

Median wage 3.5% higher in public sector.

I can well believe it - public sector pays well compared to similar private sector jobs. Note that for the top 25%, private is better, but this data is based on median...

[laurejon]

As with all other pension funds, when the money runs dry thats the end the Public Service Workers who desired Commercial Wages and got them should also have Commercial Pensions.

In addition, the Current Public Service Pensions pot should be shared out with those in the community who are financially challenged and who have been unable to make adequate pension provision to themselves due to the high rates charges imposed by Local Authorities.

The should practise what they spent their lives preaching and their pensions could provide social justice to those who have no pension.

[deano]

Public sector - payed more, retire at 60, final salary pension, subsidised key worker housing, full sick pay, good holiday, more sick days, trade union protection, better mortgage rates (job considered more secure).

Private sector - lower pay, retire at 65, worthless pension, fully priced housing, minimal sick allowance (before they sack you), lower holiday, little or no trade protection (higher risk mortgage rates).

This is a two tiered society, the state employed nu-labour with everyone else paying for it.

I wish I could join them I really do!.

PS And they don't have to do unpaid B***dy Overtime!.

Edited July 15, 2005 by deano

[OnlyMe]

Thing to do is to have a look at the overall effect this will have on the housing market.

I suggest it will be something like this:

Private sector gets pushed out of the economy, it cannot afford to compete so will lose skills to the non-productive pucblic sector and as it is non trade earning our trade deficit will balloon. Higher costs all round due to taxation will further push out the private sector. Manufacturing and industry will all but disappear over the decades and will increasing amounts of the private service sector.

Once the trade deficit reaches a critical point interest rates will soar or the pound will collapse and cause inflation which measured or not will affect the net earnings of everyone. There may not be enough spare income to even sustain historic HPE's of 3.5x

[Michael]

it depends on the area too!...........in outlying areas such as Cornwall government jobs are like gold dust.....as the salaries are better than most other jobs......

whereas in London (even with a £4k London weighting) they're relatively poor!

[737]

Interest rates down by up to 2%, a falling Pound and higher taxes.

Are the wheels about to come off the British "economic miracle"?

Editorial from todays FT

"The prospects now are for a slowdown in the growth of public spending and a reversal in the fiscal position. If Gordon Brown is to hit his fiscal rules, deficits must fall, either through a spontaneous rise in the ratio of tax revenue to GDP (as he hopes) or through higher tax rates as well (as most analysts expect). As spending slows and deficits fall, the stimulus to demand provided by the government will fall or be reversed.

Could anything offset these two sources of weakening stimulus? Much lower interest rates would help by sustaining consumption and investment and lowering the exchange rate. But the needed cut in interest rates could be large, possibly as much as two percentage points.

Lower rates would work by encouraging borrowing and a weakening pound. The former looks worrying, given already high debt levels. The latter looks inflationary. The devaluation needed to generate substantial improvements in net exports might prove to be substantial, particularly since the eurozone economy is currently so feeble. The assumption that the Bank of England will easily manage to sustain demand and hit its inflation target might prove over-optimistic."

http://news.ft.com/cms/s/2fca6030-f4cd-11d...000e2511c8.html

[laurejon]

Forget who it was who ridiculed my suggestion of the prospect of 3% interest rates.

You may now help yourself to a huge heap of humble pie.

[Charlie Don't Surf]

Forget who it was who ridiculed my suggestion of the prospect of 3% interest rates.

You may now help yourself to a huge heap of humble pie.

I'm sure he government and VIs would love to see the IRs go down. However it is not the MPCs mandate to pamper to what these people would like.

If you read the article it states lowering IRs would be inflationary, increase borrowing and weaken the pound. I'm sure the BOE is not in favour of at least 2 of these.

[laurejon]

KPI's and sentiment in the City is that rates will be plummeting very soon.

The reports and interviews are flooding the net, I'm sure the BofE know the real sources and will oblige Number11 with a rates cut next month with several more to follow.

For so long as householders are making money on their properties the Gov can do anything they so wish, say what they wish, behave as they wish. They know that, we know that, the world knows that.

The BofE independence is purely a marriage of convenience, the lever is being pulled out of number 10 and 11.

[MarkG]

You may now help yourself to a huge heap of humble pie.

Why? Did the BoE just cut rates to 3%?

Oh, nope, they're still at 4.75%, aren't they?

KPI's and sentiment in the City is that rates will be plummeting very soon.

Then you'd better be ready for a feeding frenzy in the foreign exchange markets and petrol at over a pound a liter. A 3% interest rate in the UK with US rates at 4% would be a sign of utter desperation and a collapsing economy, and the markets know that.

Also, frankly, I think you'd see a mass resignation from the MPC if Brown pushed them into cutting rates that low. Why would they want to take responsibility for the consequences of his interference?

For so long as householders are making money on their properties the Gov can do anything they so wish, say what they wish, behave as they wish.

Brown and Blair are minnows among the pirahnas and great whites of the global markets: as Lawson discovered to his cost. The opinions of British voters are far less important than the opinions of traders around the world.

Edited July 15, 2005 by MarkG

[737]

KPI's and sentiment in the City is that rates will be plummeting very soon.

The reports and interviews are flooding the net, I'm sure the BofE know the real sources and will oblige Number11 with a rates cut next month with several more to follow.

For so long as householders are making money on their properties the Gov can do anything they so wish, say what they wish, behave as they wish. They know that, we know that, the world knows that.

The BofE independence is purely a marriage of convenience, the lever is being pulled out of number 10 and 11.

<{POST_SNAPBACK}>

A 2% fall in rates plus a 3%+ increase in public spending can only result in further house price inflation, perhaps a further 25% over the next three years?. Having just STR'd this brings no joy to me but I'm now seriously considering looking for a couple of small BTLs which I'll finance with cheap and getting cheaper borrowed money.

Edited July 15, 2005 by 737

[BoredTrainBuilder]

Our politicians love to slag off the French model (and we love them for it) but we are rapidly going back to that discredited model ourselves with the resurgence of a vast and parasitical public sector.

With differential pension rights and job security bloating public sector costs each year, feeding the insatiable beast is set to get ever harder.

Why is there no well-argued opposition to this depressing trend?

We will look back at the late 1990s as a golden economic age for the UK and by 2015 we will be back behind our continental neighbours, particularly Germany which has cut labour costs by 20% over recent years.

[Bluelady]

They surveyed 5,900 managers.

Where does it say this? Where did these 5,900 managers work? In the public or private sectors? Where, in that first link, is any reference made to the methodology or sample used for this piece of alleged research?

You will also note that in their own press release (vested interest, anyone?) that again the methodology is not even hinted at and it contains the following:

The CIPD comparison does not offer support to critics who deride the public sector as being over-manned, overpaid and unproductive.

[MarkG]

Why is there no well-argued opposition to this depressing trend?

Because we're 'all getting rich' from the never-ending inflation of house prices.... what party can possibly get elected based on rational economic policies, when competing against a tax-free 40k a year increase in house prices?

In the long run, obviously, it's absolutely disastrous, but few people care about that.

[737]

They surveyed 5,900 managers.

Where does it say this?  Where did these 5,900 managers work?  In the public or private sectors?  Where, in that first link, is any reference made to the methodology or sample used for this piece of alleged research?

You will also note that in their own press release (vested interest, anyone?) that again the methodology is not even hinted at and it contains the following:

The CIPD comparison does not offer support to critics who deride the public sector as being over-manned, overpaid and unproductive.

<{POST_SNAPBACK}>

In Todays Times as in "A survey of 5,900 managers for the Chartered Management Institute "

"i]The CIPD comparison does not offer support to critics who deride the public sector as being over-manned, overpaid and unproductive.[/i]"

It does to many (outside the public service sector of course).

Are you a public sector worker by any chance? I'm not by the way - just someone who works to support them!

Edited July 15, 2005 by 737

[delboypass]

I'm sure he government and VIs would love to see the IRs go down. However it is not the MPCs mandate to pamper to what these people would like.

If you read the article it states lowering IRs would be inflationary, increase borrowing and weaken the pound. I'm sure the BOE is not in favour of at least 2 of these.

<{POST_SNAPBACK}>

Hmm i dont think they would in favour of all 3 to be fair!

[Bluelady]

Well, if you're going to trash your own sources, 737 ... If you don't believe that bit of the article you linked to, why do you believe the rest?

[Gravity's Rainbow]

http://news.bbc.co.uk/1/hi/business/4683879.stm

An odd state of affairs and not, in my opinion, the sign of a healthy economy!

<{POST_SNAPBACK}>

Rather than reading this as evidence of public-sector excess, perhaps the report reflects falling wages in the private sector. This might tie up with the the data that household incomes have dropped in real terms.

Wage increases for most of the people I know in private sector jobs have not matched the rate of inflation in the last few years.

The UK economy is very competitive and employers are screwing down costs as much as they can in order to keep prices down.

[737]

Wage increases for most of the people  I know in private sector jobs have not matched the rate of inflation in the last few years.

<{POST_SNAPBACK}>

In the year to May mainstream public-sector pay went up 5.1 per cent but with lots of extra bonuses for delivering the post or keeping patient waiting times below death rates, overall pay was up 7.6 per cent.

[MarkG]

The UK economy is very competitive and employers are screwing down costs as much as they can in order to keep prices down.

So when are we going to see 'public sector employers' doing the same? I'm sure at least 50-75% of bureaucrats' jobs could be exported to India.

[poospoon]

It really is all too vague for words. There are so many questions to ask about this "research"...never mind if it's all managers why is there a picture of nurse, fireman and a police officer? They are the face of public sector workers, how can you compare their roles to private industry?

And if people think it's so easy to work in the public sector and pay and conditions are so good, why don't they go and work in it? Might be able to afford to buy a house then.

Edited July 15, 2005 by poospoon