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Largest pay gap discrepancy between public and private in 10 years

28 Mar 2012 12:00 AM | Anonymous

The Office of National Statistics (ONS) has reported that the pay gap between the public and private sector has reached its height, with civil servants being paid up to 9pc more on average.

According to ONS public sector workers were paid on average between 7.7pc and 8.7pc more than private sector employees last year. The April 2011 figure compares with a gap of 7.8pc in 2010, and 5.3pc in 2007, before the financial crisis began.

In order to ensure the figures are consistent over time, the numbers assume employees of those banks nationalised in 2008 were in the private sector until 2011; if the ONS had not made that assumption, the pay gap would have widened even more to 9.3pc.

There are many reasons for these high figures, such as the higher number of older employees with higher wages in the public sector, the public sector holds higher skilled jobs and therefore has a higher proportion of employees with degrees or higher education and it outsources the lower-skilled jobs to private businesses.

The ONS's figures do not take into account that the private sector excludes self-employed people and non-cash remuneration such as pension contributions and health insurance.

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