Government employees in Atlantic Canada earned 6.3 per cent higher wages on average than comparable private-sector workers in 2024, according to a new Fraser Institute study. The wage gap persists even after adjusting for factors such as age, education, occupation and tenure.
The study found government workers in the region also receive substantially more generous non-wage benefits than their private-sector counterparts. More than 60 per cent of government employees are covered by registered pension plans, compared to less than 25 per cent of private-sector workers.
“Bringing government-sector compensation in line with the private sector would not only help governments in Atlantic Canada control spending without reducing services, but would also maintain fairness for taxpayers,” said Jake Fuss, director of fiscal policy at the Fraser Institute.
Unadjusted wage gap reaches 33%
Before accounting for differences between workers in the two sectors, government employees in Atlantic Canada received 33 per cent higher wages on average than private-sector workers in 2024. The gap narrowed to 6.3 per cent after researchers adjusted for characteristics including gender, sector, type of work and other factors.
The analysis covered federal, provincial and municipal government workers across New Brunswick, Nova Scotia, Prince Edward Island, and Newfoundland and Labrador.
Retirement and leave benefits favour public sector
Government workers in Atlantic Canada retire earlier and receive more personal leave than private-sector employees. In Newfoundland and Labrador, government employees retire at an average age of 61.5 years compared to 64 years for private-sector workers.
Government employees in that province also receive 19.7 days off for personal leave compared to 9.7 days for private-sector workers. Nova Scotia government workers receive 16.3 personal leave days versus 11 days in the private sector.
Pension coverage rates vary by province but consistently favour government workers. In Nova Scotia, 94 per cent of government employees have pension plan coverage compared to 20.6 per cent of private-sector workers. Prince Edward Island shows the smallest gap, with 63.6 per cent of government workers covered versus 11.9 per cent in the private sector.
“Of course, governments in Atlantic Canada should provide competitive compensation to attract qualified employees but clearly wages and benefits in the government sector are out of step with the private sector,” said Grady Munro, policy analyst at the Fraser Institute.
The Fraser Institute is a public policy research organization based in Vancouver with offices across Canada.
