The Office for National Statistics has published a report into the public-private sector pay gap. The report found that, including pension contributions, public sectors were paid on average thousands of pounds more a year then private sector workers. I haven’t read through the methodology, so can’t comment on any flaws or caveats. What I am more interested in is the reaction to the report, specifically by a senior TUC official:
Adam Lent, the head of economics for the TUC, said: “You can’t make direct comparisons. The public sector has many more professional and highly skilled workers within it than the private sector. Averages simply do not tell us anything useful.”
This might indeed be true. But what does it say about the TUC’s stance? Firstly, it could suggest that the TUC supports a free market in employment, which means they will no longer be campaigning against pay freezes. This can be deduced by the fact that Mr. Lent feels that the market should determine workers’ wages (by their qualifications), and not any external factors.
This may be a incorrect interpretation however. The other way to read it is that Mr. Lent feels that people with degrees/professional qualifications are better than those without, and so deserve higher wages. This is not a fallacy restricted to the TUC. An article in the Guardian recently articulated the same feelings. Why is this so? Well, if we let the market decide, that is not a problem. But if you don’t support a free market in employment (which the TUC doesn’t), then you have to make the case that degree-educated workers deserve more. Why though? Because they have sat in a classroom for a few years, as opposed to gaining experience working? This lacks an inherent logic (pay is determined by supply and demand, not educational achievement), as there is no reason other than market forces why say, a civil servant should receive higher wages than a cleaner. There is also a social mobility argument. Private school pupils are overrerepresented at the best universities, so presumably the way to encourage social mobility is for the state to place less emphasis on degree-educated individuals.
Since there is no intrinsic reason why degree-educated people and those with professional qualifications should receive higher pay than those without, the only justification could be snobbery and a sense of entitlement.
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Filed in: Economics,Economy