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8 February 2013
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TDRI study finds higher lifetime remuneration for civil servants

Despite lower monthly pay, civil servants’ lifetime remuneration is higher than private companies’ employees, regardless of education levels, according to a study by the Thailand Development Research Institute.

The recent increase in government workers’ salaries, to at least Bt15,000 for civil servants with bachelor’s degrees, will only widen the public-private income gap, said the research conducted by Voravan Chanduaywit and Chayadol Lomthong. It was financed by the Thailand Research Fund.

The researchers based their study on the incomes of civil servants and private companies’ employees over the past 31 years, from 1999 when they were 25-34 years old to 2010 when they turned 55-64. The incomes included bonuses and all allowances.

The lifetime incomes of civil servants who live outside Bangkok were higher than those of private-sector employees, who experienced volatile salary levels. During an economic decline, the employees of private firms face sharp drops in salary, while those of civil servants remain stable.

Civil servants living in the Bangkok area have lower salaries on average than those of the private sector but also experience less income volatility. Therefore, unlike what has been perceived, the salaries of civil servants are not always lower than those of employees in the private sector.

Extra income excluded

This study does not have information on extra income civil servants receive from such sources as tutorial or research fees.

The value of benefits gained by civil servants accounts for half of their lifetime income, while that of employees in private firms is relatively lower.

The study also found that the lifetime salaries of civil servants were higher than those of employees in private firms at all educational levels both in and outside Bangkok.

Because of the higher value of benefits, civil servants with less than a bachelor’s degree also enjoy lifetime income higher than that of employees in the private sector. However, private employees with degrees higher than the bachelor’s level do better than their counterparts with same qualifications in the state sector.

The state budget for newly recruited civil servants is lower than the cost of salary increases for existing staff.

The study found that the increased salaries for civil servants with education lower than a bachelor’s degree would gradually widen the gap between state employees and those in the private sector. But the lifetime salaries of civil servants with bachelor’s degrees are still lower than those with the same qualifications in the private sector. Therefore, it concluded, salary adjustments should be focused on high-ranking civil servants.

The number of new civil servants with low skills should also be limited and their jobs should also be outsourced to private firms, the report said.

First published: The Nation website on 31st December, 2012