Ottawa could save $20 billion per year in wages!

The Canadian Federation of Independent Business (CFIB) recently revisited its old demons and produced a “study” – full of calculation errors and approximations – claiming that public sector wages are too high compared to wages in the private sector.

The Canadian Union of Public Employees (CUPE) and the Broadbent Institute were quick to point out that the CFIB, hampered by its own ideological blindness, was using pretzel logic to reach conclusions that are not borne out by facts.

While it is true that full-time wages in the public sector are 2.3% higher than in the private sector for occupations that exist in both sectors, this is largely because women, visible minorities and Aboriginal people are less likely to experience wage discrimination based on their status in the public sector than in the private sector. In other words, Aboriginal people, visible minorities and women workers are not as well paid by the majority of the businesses which the CFIB claims to represent as they are in the public sector.

Hence, for every dollar earned by a university-educated male worker, a university-educated female worker earns 82 cents in the public sector and only 73 cents in the private sector. The gap is even worse for Aboriginal workers: for every dollar earned by a university-educated non-Aboriginal worker, a university-educated Aboriginal worker earns 86 cents in the public sector, but only 56 cents in the private sector.

As far as the CFIB is concerned, Ottawa can logically save taxpayers $20 billion annually by:

These measures would really do the trick. Thank you CFIB!