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European public sector under threat says ILO

29 June 2012
Mirror with people
Budget deficits have led to significant cuts in European public sector expenditure, employment and wages. This according to a new study from the International Labour organisation.

- Unprecedented public sector adjustments combined with a lack of social dialogue between government and employees has lowered job security, pay and working conditions in Europe’s public sectors, a new ILO study says.

The paper on “Public Sector Adjustments in Europe - Scope, Effects and Policy Issues” shows that urgent pressure to reduce public expenditure tends to favour quantitative adjustments, mainly cuts in expenditure, jobs and wages in the public sector.

These changes will affect the future quality of public services, ILO expert Daniel Vaughan-Whitehead says:

"This is already to be observed in education and health care, but also threatens jobs in the public administration."

In a number of countries, public sector employees have lost the wage premium they traditionally had over the private sector, which was empirically justified by higher education levels in the public sector.

Deteriorating wages and working conditions
“Deteriorating wages and working conditions in the public sector compared to those in the private sector have not only led to significant emigration – especially among doctors, nurses and teachers. The public sector has also stopped attracting the quantities of young qualified graduates which hitherto have been its lifeblood,” explains Vaughan-Whitehead.

The study also warns of the worsening social climate in the public sector. Public sector reforms often triggered an immediate and massive wave of demonstrations and strikes by public sector employees – often joined by other social groups – throughout Europe.

Social dialogue needs to be strengthened
According to the ILO expert, there is a need to strengthen social dialogue between government and employees, and to consider a better mix between fiscal and other important considerations.

“Issues like equality, social dialogue, employment prospects, working conditions and the future efficiency and quality of public services merit more attention. Only under these conditions could public services in Europe continue to provide an important source of both social cohesion and economic growth,” Vaughan-Whitehead concludes.

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