European public sector under threat

A new ILO study shows budget deficits have led to significant cuts in European public sector expenditure, employment and wages. It also discusses the key role of social dialogue under the present circumstances.

News | 28 June 2012
GENEVA (ILO News) - 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.

“All these changes cannot be neutral for the future quality of public services. This is already to be observed in education and health care, but also threatens jobs in the public administration,” says Daniel Vaughan-Whitehead, an ILO expert and editor of the study.

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.

An opportunity for social dialogue

“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.

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.

*The report was prepared in cooperation with the European Commission. Journalists interested in accessing the study, please contact the ILO Department of Communication and Public Information: +4122/799-7912, communication@ilo.org