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The state remains the best employer in Greece

18 November 2013 / 17:11:48  GRReporter
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After two memoranda and an over 40 billion euro cut in income within three years, the balance of wages in the public and private sector still tips in favour of the salaries paid from the state budget. The data confirm the undeniable fact that the most productive part of the Greek economy has borne the burden of the financial crisis. The most obvious evidence is the fact that the vast majority of the total of 1.5 million unemployed in the country are former employees in the private sector, such as workers, farmers, freelancers and businessmen.

In addition, the taxes paid by the Greek businessmen are significantly higher than the obligations of their counterparts in other European countries. They are one of the main factors for the increased unemployment in the private sector, for the informal employment, for the non-payment of social security contributions, the reduced private investment and the lack of competition.

In particular, according to a study by the European Commission, the difference between the salaries in the public and private sector is the largest in Greece. In 2006, the salaries of civil servants were 50% higher than the pay in the private sector. Two years later, this difference had fallen to 40% (or 8.3% on average). Nevertheless, after the introduction of the unified payroll table in the public sector and the reduction of the basic salaries in the private sector by 22% - 32%, the difference increased again in 2012. At present, it is almost 30% regarding the basic salaries of employees with primary and secondary education in the public and private sector and, in some cases, the salaries of civil servants are 58% higher.

The study of the European Commission is for the period 2006-2010. The comparison of the last three years was based on data from the unified payroll table in the public sector and data of the Institute for Employment of the trade union of private sector employees GSEE.

For example, in early 2012, the basic salary of an inexperienced employee in the private sector was 751.39 euro, i.e. slightly lower than the corresponding salary of a newly recruited employee in the public sector under the unified payroll table (780 euro). Then, a 22% reduction of the wages of employees aged over 25 years was voted as well as a 32% reduction for those under the specific age. So, the basic salary in the private sector fell to 586.08 euro for employees aged over 25 years and to 510.95 euro for employees under that age. Therefore, the difference between the salaries in the public sector in 2012 had risen by 33% with regard to the people aged over 25 years and by 52% for those under that age. The comparison is based on the gross salary, excluding benefits.

Example № 2: A private unmarried employee with 9 years of experience receives 761.90 euro whereas, in the public sector, the salary of the same employee with secondary education is 1,000 euro per month.

It is not always possible to compare the salaries in the two sectors, because of the following three reasons:

Firstly, because, theoretically, there is no ceiling on income in the private sector whereas it is 2,409 euro per month in the public sector.

Secondly, the salary in the public sector increases on the basis of the level of education and the transition to a higher category every two or three years. For example, upon appointment in the public sector, an employee with primary education and no experience receives a salary for first category, which is 780 euro. In the private sector, however, the basic pay of an employee with higher education and no experience is 586 euro whereas this employee would have received around 1,000 - 1,100 euro in the public sector.

Thirdly, there are 14 categories of salaries in the private sector, at least theoretically, whereas there are 12 in the public sector but the difference still exists.

Tags: SocietySalariesPublic sectorPrivate sector
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