Measuring public sector employment: a review of some methodological issues

Employment is one of the most commonly used indicators for the size and importance of
establishments as well as for economic sectors. For this reason alone one would expect statistics on
public sector employment to be easily available and reasonably comparable internationally, e.g.
between the member countries of the European Union. However, one of the more surprising facts
about official statistics is that most countries have rather poor statistics on employment in the public
sector, and about the characteristics of those working for the public sector. It is also difficult to find
statistics on public sector employment which are reasonably comparable over time and between
countries, not least because a stable and consistent dividing line between the ‘public sector’ and the
rest of the economy is difficult to draw in practice. This paper reviews some of the reasons for this
as well as some of the quality issues involved in measuring public sector employment. It also relates
various quality concerns to four types of issues for which such statistics may be desired: describing
the importance of public sector employment in national labour markets, as well as the direct impact
on public sector employment of variations in public budgets; analyzing the productivity of the public
sector; and describing the impact on the affected workers of privatization or sub-contracting of
activities which previously have been carried out by (the staff of) public sector units. The hope is
that this review can contribute to a better understanding of the issues and eventually also to an
improvement of the current situation.