September 1, 2014
As of this week, both my children are in secondary school. Time flies and in no time they will be finished school. If they were to ask me (which they don’t) what they should do after school, what should I say? If they ask, “Dad, what should I do for a living?” or, “Where should I work?” what would you tell your children?
At some stage, most parents believe that they might be of some help to their kids, at least in terms of guidance. Given that in our house I am generally relegated to some pathetic lowly position somewhere between the village idiot and a human ATM, maybe my guidance phase will never come. But if it does, what will my answer be?
When assessed from the perspective of an adult who realises after a few decades in the real world that life is tricky, insecure and that nothing comes easily, an understandable default position is to consider what job pays best, where hours are tolerable and the pension is decent.
The place in Ireland that comes close to giving workers good pay, job security and a decent pension is the public sector.
Figures published last week reinforce what we have all sensed for years: on average, people in the public sector get much better paid than people in the private sector. The CSO now says that public sector workers earn on average 48 per cent more than those employed in the private sector.
Public servants are paid an average of €919 per week, compared to €622 in the private sector. Just take that in for a second. What justifies this significant disparity?
The people representing the public sector say you shouldn’t compare the two sectors because public sector workers have more degrees, have a higher standard of education and are generally older.
This is hardly a satisfactory answer for the rest of society. It is only a legitimate reason if you accept that this way of rewarding people is legitimate.
If you link pay to levels of education or age or the number of degrees, then of course older people with more degrees will get paid most. But what if such a system of rewards sets up a bizarre incentive system?
What if people are doing extra education courses not for the sake of education, but to “qualify” themselves for pay rises or to climb up the public sector promotion ladder which uses a “degree quota” as a measure of merit?
If this is the case, there will always be more degrees in the public sector. This educational inflation will be particularly attractive if there is generous study leave and courses are paid for by other taxpayers. Sure who wouldn’t do an extra degree? But does having a degree in itself qualify you for higher wages? Why should a public servant who decides to do a degree that only has a tangential impact on their actual job as part of a further education programme, be entitled to more wages?
You tell me.
However, if this reward system becomes embedded, it is easy to justify higher wages because you have the reason and the reason is enough. It also helps that the other institutions that give out the degrees are also public sector outfits. It kind of keeps things in the family.
When we stand back, we see that in a capitalist society the only reason anyone should get higher wages is if the service he/she provides is getting better. If yes, great, but if not, then the organisation can’t justify wage increases.
I am not aware of a massive change in the effectiveness of the Irish public sector or its provision of basic services over the last few years.
What I do know is that the ultimate economic sanction – losing your job – is not something public sector workers experience.
Taking wage cuts is not the same as having no wage at all. Most importantly, public sector workers are promised pensions that private sector workers can only dream of. This is an enormous positive and – when taken together with career breaks, nine to five, overtime and higher weekly wages – it suggests that I would be a fool to advise my kids to do anything but get jobs in the public sector. But we still have no real persuasive reason as to why the public sector workers are better off than private sector workers.
In truth, the real reason the public sector is a much better place to work than the private sector has nothing to do with degrees and the like. It has everything to do with unions.
The job of the trade union is to get the best deal for its members and the Irish public sector trade unions have done an amazing job for their members.
They have protected them from the worst of the recession and engineered safety nets insulating their people from the slump, so much so that the relative pay gap between the public and private sector has risen as the country became progressively poorer.
The public sector workers have a say at the top table. They have a stake in society. For many, on lower pay scales, it mightn’t seem like it, but it is the case. They have someone powerful to speak on their behalf and they have a political system that listens to them. In short, they are insiders, not the most conspicuous insiders and not insiders like their civil servant bosses, but insiders nonetheless.
The society splits in a crisis between insiders and outsiders.
The insiders are those with a stake in the society. They have access to the infrastructure of influence. They have the ability to negotiate. They have bargaining power.
The outsiders are those without such a stake. So when the self-employed electrician’s business goes bang, he can’t even get social welfare because he has no stamps.
He is an outsider, even though he has employed people and paid tax for years. He has no one to speak for him, no voice – however small – at the top table.
When the factory closes, its workers are outsiders. They are on their own.
When a pensioner who has worked in the private sector has her pension eviscerated, as her nest egg blows up in Anglo and AIB shares, she has no comeback. She is an outsider.
When the small business goes bang, its suppliers are shafted, languishing at the bottom of the creditor queue. They are outsiders.
When you talk to your kids, what will you advise them: to be an insider or an outsider?