Is there room for improvement in wage setting in Poland’s public administration?

Maciej Albinowski and Iga Magda

No 02/2023, IBS Policy Papers from Instytut Badan Strukturalnych

Abstract: There are several areas for improvement in wage setting in the public administration sector in Poland. Public administration pays a lower premium for tertiary education and offers lower wages for young employees than the business sector. Instead, public administration provides significant returns to job tenure, incentivising lifelong employment. Such a model is conducive to the smooth functioning of the administration. However, it limits the possibilities of structural changes in employment. The present remuneration system may also lead to negative selection, where low-productivity workers remain in the public administration till retirement, while high-productivity workers choose employment in the business economy. To address these issues, we propose a reduction in automatic seniority premiums, an increase in basic wages, and better valuation of scarce skills.

Keywords: public administration wages; public-private wage gap; returns to experience (search for similar items in EconPapers)
JEL-codes: H83 J31 J45 (search for similar items in EconPapers)
Pages: 11 pages
Date: 2023-07
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Persistent link: https://EconPapers.repec.org/RePEc:ibt:ppaper:pp022023

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