Reforms in the area of employment and determining of wages in the public sector of RS needed – the sooner the better

9. April 2012.

In the analysis of effectiveness of the Republic of Srpska’s public authorities made by the Center for Research and Studies GEA it was determined that RS has no choice and, sooner or later, has to decrease the number of Governmental sector employees.

At the moment, around 28.5% of all employees from RS works within the Government and Governmental institutions, which is among the highest percentages in Europe. Employees from public companies, where the problem of overemployment is also significant, were not included in the mentioned data. RS also holds record when it comes to the difference between wages in public and private sector.

Conclusions of the analysis:

  1. fiscal burden for domestic economy is becoming unbearable
  2. there was an increased growth of deficiency of the republic budget and funds
  3. through its wage policy, public sector, being the biggest employer by far, prevents the development of healthy negotiation between employers and trade unions in private sector
  4. public sector, as the employer, has become unfair competition to private sector
  5. attractiveness of employment in public sector has lead to suppressing entrepreneurial initiative, especially among the youth

Recommendations for new public sector wage policy:

  1. to level wages in the public sector with comparable workplaces in teh private sector
  2. to link further growth of the base for public sector wages increase to average wage movements in private sector
  3. to improve the quality of statistical data on wages (especially in private sector).