Public Sector Wage Growth in Alberta

Abstract

In recent years, Alberta’s fiscal stance has shifted from large surpluses to deficits, and a large part of the blame appears to be due to rising public sector salaries. Since 2000, the province’s public sector wage bill has shot up by 119 percent — almost double the rate of growth in the rest of Canada. Wages, previously roughly at par with the rest of the country, are now higher (in many cases very substantially) across all public sector categories, including health care, social services, education and government, consuming 95 percent of the increase in provincial revenues over the past decade. At the same time, the number of public sector employees has grown faster than the overall population; it is difficult to attribute this sharp uptick to a rise in productivity, or the need to compete with private industry for skilled workers.This paper breaks down the increases in every category, arguing that if the provincial government is looking to trim expenditures, public sector salaries are a good place to start.The authors make their case using detailed Statistics Canada data, throwing down the gauntlet to defenders of the status quo and challenging them to justify these disparate increases.