Pay and employment trends in the public and private sectors

[Proposition Joe]

An interesting paper by Colm McCarthy.

The main conclusion is the effect of the pension levy has not diminished the public sector pay premium, as its been matched by pay cuts across the private sector.

Some interesting discussion on the topic over at irisheconomy.ie.

[feargach]

There's the quality issue to consider. There are no Irish companies which are the best in the world at what they do. Ryanair are just the cheapest, and they cogged their entire business model from Southwest Airlines in the US. Irish business is simply shoddy compared with the rest of Western Europe.

There are places in the world with more expensive houses, but those houses elsewhere are at least well-built. Even Paraguay has affordable, reliable broadband.

There is huge room for improvement in the health sector in Ireland, but if their standards were as low as indigenous Irish private companies, the hospitals here would be as bad as those in Lagos.

Looking at what international investors have done to the ISEQ in recent months, it looks like others have noticed too.

[Proposition Joe]

There's the quality issue to consider. There are no Irish companies which are the best in the world at what they do. Ryanair are just the cheapest, and they cogged their entire business model from Southwest Airlines in the US. Irish business is simply shoddy compared with the rest of Western Europe.

There are places in the world with more expensive houses, but those houses elsewhere are at least well-built. Even Paraguay has affordable, reliable broadband.

There is huge room for improvement in the health sector in Ireland, but if their standards were as low as indigenous Irish private companies, the hospitals here would be as bad as those in Lagos.

Looking at what international investors have done to the ISEQ in recent months, it looks like others have noticed too.

Do you mean the differential is justified by the relative crap-ness of the Irish private sector?

On that train of thought, it would be very hard to argue that the Irish public sector provide a world-beating service either. Outside of education and a few other outliers, the quality of service provided is low by European standards.

[GJG]

There's the quality issue to consider. There are no Irish companies which are the best in the world at what they do. Ryanair are just the cheapest, and they cogged their entire business model from Southwest Airlines in the US. Irish business is simply shoddy compared with the rest of Western Europe.

There are places in the world with more expensive houses, but those houses elsewhere are at least well-built. Even Paraguay has affordable, reliable broadband.

There is huge room for improvement in the health sector in Ireland, but if their standards were as low as indigenous Irish private companies, the hospitals here would be as bad as those in Lagos.

Looking at what international investors have done to the ISEQ in recent months, it looks like others have noticed too.

Are you drunk? Are you even sure whether you are slating Irish private sector workers or their management?

Ryanair copied and bettered SouthWest, but if it was that easy anybody could have done it. They are now the biggest airline in Europe, that didn't happen by accident.

In an world that is as globalised as it is, there are few businesses that rooted in a single country, but Ireland has produced an impressive list of entrepreneurs and products, from Ballygowan to O'Briens Sandwiches. The public sector has produced little but excuses.

The issue here is that the private sector is playing with their own money. Sure some of them make dreadful mistakes and, give or take a bailout, they pay for them themselves. In 99 per cent of cases, private sector companies that are badly managed, or lazy, or just unlucky, workers and management lose their jobs and shareholders lose their shirts. With the public sector, they can be as indolent as they like, and the taxpayer has to pick up the tab.

[feargach]

In an world that is as globalised as it is, there are few businesses that rooted in a single country, but Ireland has produced an impressive list of entrepreneurs and products, from Ballygowan to O'Briens Sandwiches. The public sector has produced little but excuses.

Bottled water (paying for what you can get for free out of the tap) and sandwiches that cost 1500% what it costs to make them? That's the best Ireland's private sector can do. Those are our business champions: reasonably good imitations of things that had already been done and perfected elsewhere are the pinnacle of our private sector achievement.

If Ireland's public sector aimed as low as its private businesses, we'd be taken over by Zimbabwe.

OK I realise that the real culprit are the banks who still refuse to loan a penny to non-property businesses, but the point still stands.

Irish business standards would probably improve if they got some decent credit from the banks, and the take-home pay of private sector employees relative to the public sector would improve as a result of them starting to raise their game.

[politicaldonations]

Well seems like FF are preparing to follow my suggestions and benchmark to Average EU public sector pay. About time and should see PS pay cut 30+% in years to come.
Benchmark deal on public pay criticised by Mansergh - The Irish Times - Fri, Apr 10, 2009
QUOTE:
He said that Minister for Finance Brian Lenihan had expressed the belief that pay at leadership levels in the public sector should be more in line with pay in other countries, rather than with top-level private sector pay in this country which had become over-inflated in recent years and was now falling in any event.

“The Minister has defined in a nutshell what has gone wrong over the past decade or so,” he added
END QUOTE.

[feargach]

The issue here is that the private sector is playing with their own money.

What you say is, unfortunately, literally true.

There actually are Irish businesses that are world-beaters (in quality terms) at what they do, unfortunately they have to set up in the UK to get access to credit.

As McWilliams has been pointing out forever: Irish banks refuse to lend to Irish businesses unless they're part of the property bubble.

But bear in mind, the public sector workers are well aware that, whatever the flaws in the service they provide, it is nothing compared to the raping they get every time they purchase a good or service from a typical Irish business. Rip-off Ireland became a cliché for a reason, you know.

[Proposition Joe]

Bottled water (paying for what you can get for free out of the tap) and sandwiches that cost 1500% what it costs to make them? That's the best Ireland's private sector can do. Those are our business champions: reasonably good imitations of things that had already been done and perfected elsewhere are the pinnacle of our private sector achievement.

Those companies are clearly not the pinnacle of private sector achievement. I guess the other poster mentioned them as they are globally known brands.

There are a number of better examples in the technology sector: Havok, TrinTech, Iona to name a few. Granted there are not as many as there should be, arguably this is down to government policy in over-emphasizing FDI, the education sector being too focused on rote-learning over creative thinking and the property bubble gobbling up cash that might otherwise have been invested as VC.

Anyway the original point is being lost: that the top dog in An Bord Snip Nua has clear views on subject of the pay disparity.

[Mar Tweedy]

Well seems like FF are preparing to follow my suggestions and benchmark to Average EU public sector pay. About time and should see PS pay cut 30+% in years to come.
Benchmark deal on public pay criticised by Mansergh - The Irish Times - Fri, Apr 10, 2009
QUOTE:
He said that Minister for Finance Brian Lenihan had expressed the belief that pay at leadership levels in the public sector should be more in line with pay in other countries, rather than with top-level private sector pay in this country which had become over-inflated in recent years and was now falling in any event.

“The Minister has defined in a nutshell what has gone wrong over the past decade or so,” he added
END QUOTE.

I'm all for average EU pay so long as it goes along with average EU taxes and insurance payments and average EU publicly provided services! Social democracy rather than a country run for the interests of banks and property developers. Heaven!

[Dios]

Bottled water (paying for what you can get for free out of the tap) and sandwiches that cost 1500% what it costs to make them?

Its fairly clear your entire experience with the private sector has been buying your lunch down the garage forecourt. Invaluable and all as that input is, thanks anyway.

If Ireland's public sector aimed as low as its private businesses, we'd be taken over by Zimbabwe.

In order for that to be the case, the public sector would first need to have aims.