In covid times, we are overwhelmed by daily statistics on the number of newly infected, performed tests, current cases… Unfortunately, these data have in common that they are growing (trend).
But there are other statistics that deserve attention. One of them, for example, shows that the gap between private and public sector revenues is also growing.
Z that Information system on average earnings it shows that public sector wages jumped eight percent in the second quarter compared to the same period last year. Thus, they increased by a value that far exceeds not only inflation but also economic growth. At the same time, the private sector was just crawling, with wages rising by 2.1 percent, which does not cover inflation.
The result is that while the average monthly wage of people working in the private sector is 36,593 crowns, employees of the state, regions, municipalities and their budgetary or contributory organizations (public sector employees) will reach 40,572 crowns. The difference is 3979 crowns.
Do you want to compete with the state?
However, the average wage in the private sector is overstated by the wages of the best-paid employees. Therefore, a better picture of the real situation is given by the median income, which lies in the middle – half of the income is below it and half above it. In this case, the difference is directly abysmal. An employee of a private company loses 7508 crowns to a state employee.
It is true to mention the fact that the advocates of higher salaries in the public sphere point out: It employs a larger share of university-educated people than in the private sector. That cannot be denied. At the same time, however, it is clear that people with a university degree have a better chance of a higher income in the private sector, which is not bound by various tariffs.
It is obvious that the big difference between the average and the median is also due to the fact that public administration is becoming more and more attractive for people with an apprenticeship certificate and graduates. It is especially true for them that the treasury has a golden bottom. Today, their income from the state is often at least equal to that which they come up with from a private individual. To do this, they have higher job security.
Once upon a time, job stability was a bonus in explaining why salaries in the state were only catching up with those in the private sector. Today, they have often overtaken them, and they are still moving away from them. Despite the fact that the private sector has to earn salaries for state employees.
At the same time, it is clear that in the age of covid, the difference between wages and salaries will increase. Nothing against higher salaries for teachers. But the corona-nekorona unions are asking for tariffs for public sector workers to increase by at least seven percent next year (10 and 15 percent for some industries).
It can be suspected that there is a time (if it has not already occurred) when, with a few exceptions, private individuals will not be able to compete with the state for a combination of higher salaries and employment security. And it is clear that most workers in the private sector will be “beaten” more in this crisis than government employees. Private individuals have to save more (even on wages) than the state. Especially because the state manages foreign money.
The mentioned difference in income would probably not be so noticeable if the state were not so well-groomed and if we did not live in a time that can be called “treasury”. It has never swelled the state (and at the same time the public) sector as it did under the Babiš movement and the Social Democrats.
In 2013, when Babiš joined the government as Minister of Finance, 413,595 people worked in the civil service. From then until last year, their number increased to 449,018 people, it is written in report Of the Supreme Audit Office from September this year. (The number of employees in the public sphere exceeded 700,000.)
At the same time, state budget expenditures on salaries increased by 77.5 billion crowns, from 132 billion to 209.5 billion (pages 36 and 37 of the report).
And another alarming comparison from the SAO report: The share of salary expenditures in state budget revenues in 2016 reached 11.8 percent. Last year, it was already 13.75 percent – all despite the comforted economic growth and rising government tax revenues.
The SAO report notes: “The efficiency of the government sector has not increased, but has been declining in recent years.”
Otesánek vs. grandmother
The state is Otesánek and he behaves the same way. To refresh the memory – in the fairy tale Otesánek’s appetite grows in proportion to the amount of food he organizes. First he eats the porridge, drinks a sip of milk, then tunes in a loaf of bread and arranges for Mom and Dad. When he comes out, he pulls on a girl with a wheelbarrow full of clover, a farmer with horses and a carriage…
Eventually, Otesánek stumbles to a field where his grandmother digs cabbage. He’s about to swallow her. However, the witty senior woman, protected by an FFP2 respirator and armed with a hoe, does not hesitate, she uses her tool to break up her abdomen and those with whom she stuffed herself climbed out of Otesánek’s stomach.
But this is a fairy tale. In the real economy, the story of a grazed state does not end so easily, quickly and happily.
