Employment in public administration falls sharply

Over 800,000 net jobs have been lost in public administration – the part of the public sector responsible for core government functions – since 2008, as governments have sought to reduce public debt through spending cuts. Over the five years, the headcount has declined by 5%, which is proportionally more than the total employment decline.

Nineteen of the 28 Member States have cut their public administration workforces; the most drastic case is Latvia, where 29% of the workforce has been cut, followed by the UK and France, with declines of more than 10%.

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Employment rises overall

However, employment overall in public services has risen by 4% in the EU since 2008, at a time when overall employment in the region has fallen by 2.6%. Most of the gain has occurred in health, but education has also contributed.

Fiscal retrenchment has recently begun to bite in these sectors too, with rates of employment increase flattening out in the most recent two years and a net decline in education sector employment between 2012 and 2013. There is some evidence that an increasing share of new education and health jobs are in the private sector.

Pay cuts or job cuts?

Governments in Ireland, Portugal and Spain – countries among the worst affected by the crisis – more often opted for pay reductions or freezes to control the public sector pay bill, and staff cuts were relatively low, according to a survey of senior public service executives (the COCOPS project). By contrast, layoffs were favoured over pay restraint in Denmark, Finland and Sweden. 

Much of the research on recent public sector restructuring carried out by Eurofound finds that the process was generally flawed: decisions were not well prepared, processes were carried out quickly and often not transparently, and consultation with the social partners was limited. 

An assessment of the impact of the changes on public sector employees, based on the COCOPS survey, is quite negative. When questioned on 16 aspects of internal performance, 2 of the lowest scores were related to staff motivation and the attractiveness of the public sector as an employer. Assessments were particularly negative for these dimensions in France, Italy, Spain and the UK.

Public sector restructuring is the theme of the recently published 2014 ERM annual report, examining the impact on the public sector of government austerity measures.