The Manitoba government has promised to deliver some tough measures next month in its 2017 budget. A study released Monday urges the province to go even further.
The report said the province is carrying some 35,000 "excessive" public-sector employees compared to the national average among the 10 provinces and massive cost savings could be found in shedding workers "without affecting services delivered to citizens."
"For Manitoba... reducing the number of public-sector employees and restraining their wages will become necessary — even if undesirable — in the years to come," said the authors of The Size and Cost of the Public Sector in Western Canada, published by Winnipeg-based think tank Frontier Centre for Public Policy and the Halifax-based Atlantic Institute for Market Studies.
According to the report, 2015 data collected by Statistics Canada showed Manitoba and Saskatchewan had 111 public-sector employees per 1,000 residents, the most among the 10 provinces. Ontario had the lowest (73), with British Columbia close at 75. The national average was 83.
As a percentage of all jobs, 21.6 per cent of Manitoba employees were in the public sector, second highest in the provinces behind Newfoundland (25 per cent), the report said. Alberta was lowest at 14.1 per cent, with Ontario at 14.2 per cent. The national average was 18.4 per cent.
According to the report, Manitoba's cost of salaries for public-sector employees in 2015 was $2.2-billion more than if it had employed the national average of 83 per 1,000 residents. However, the province's average salary for that group was also the lowest in Western Canada — $62,141 — compared to $81,141 in Alberta, $69,561 in B.C. and $68,299 in Saskatchewan.
The study's figures include municipal and provincial-level public servants paid directly by the government (health-care workers, educators, bureaucrats and police, for example). The numbers do not include employees of the federal government nor Crown corporations and private industry that is subsidized by the provincial government.
However, the report's numbers do not tell the whole story, said David Camfield, associate professor of labour studies and sociology at the University of Manitoba.
"What this report is doing is trying to encourage people to see a problem where no problem exists by suggesting the public sector in Manitoba is bloated," he said Monday. "They are treating the public sector as if it is fundamentally a negative thing, (then) a larger public sector must be a bad thing.
"(The public sector is) providing public goods... it's not waste, it's providing services that provide to the quality of people's lives, the environment in which businesses operate and so on."
The study is "pretty shallow," Camfield said, as it does not delve into reasons behind each province's numbers, such as economy of scale and past privatization. "Larger provinces are going to have, all things being equal, smaller percentages of people in the public sector because you have to run a certain set of government ministries whether you are talking about a small province or a large province."
Manitoba labour leaders were also dismissive of the think tank report.
"The study looks only at the number of employees in each province without looking at the different demands or levels of service in each province. That, combined with the fact that it lumps together municipal and provincial workers, makes it difficult to base any useful recommendations on it," Michelle Gawronsky, president of the Manitoba Government and General Employees' Union, the largest union in the province, said in an email.
"Manitobans enjoy many public services that other Canadians don’t — for example, we have one of the most comprehensive home-care programs in the country. Yes, delivering quality public services requires people to deliver them. Cutting or privatizing jobs is not the answer. That would only hurt the services Manitoba families count on."
"The report lumps in municipal with provincial — an area where the provincial government has no jurisdiction. The report also makes no attempt to investigate the level and types of services provided by the respective governments, nor public satisfaction with the services provided," agreed Kelly Moist, president of CUPE Manitoba.
"The report confirms what we know: provinces with larger populations tend to have lower ratios of public employees to residents than do provinces with lower populations," he said. "Manitoba and Saskatchewan have the disadvantage of having smaller populations in very large provinces... Further, the report does not take into consideration Manitoba and Saskatchewan are home to very large, young Indigenous communities. We know that due to the legacy of colonialism and residential schools that these communities have larger demands on government services."
The Frontier Centre report suggests if the public sector could be reduced by two per cent a year (through moves including a hiring freeze and attrition), Manitoba could decline to the national average in eight years, freeing up some $2 billion a year for other use.
Emails requesting comment Monday from Manitoba's finance minister and deputy finance minister were not returned.
However, citing the example of B.C. privatizing the work of thousands of health-care support employees in the 1990s, Camfield said any potential large-scale cutting exercise must be viewed in more than financial terms. "Was that a good move for society? Do you want to have worse-paid, probably less-motivated people doing those essential... sometimes 'invisible' jobs that keep the public health-care system running?"
Camfield also expressed concern studies such as this may have undue influence on public perception.
"It's fundamental assumption, the way the study is presented, is to encourage people to see these statistics as evidence of a problem... They've been encouraged to see the public sector as the source of a problem," he said.
"Manitoba is not Greece," Camfield said. "Yet we are being encouraged to think we are on the edge of a debt crisis in Manitoba... It is important for people to know that so they don't get scared into supporting public-policy options that might not be the wisest."
According to the 2016-17 budget, Manitoba expected to spend $874 million (up $44 million from the year before) to service its debt with revenue of $15.23 billion and expenditures of $16.3 billion.