The wage gap between public sector workers and those in the private sector is 22 per cent, according to a Canadian Federation of Independent Business (CFIB) report.
Municipal government workers across Canada are making $6.43 more per hour on average in wages and benefits than their private sector counterparts.
The wages and benefits cost taxpayers $3.4 billion per year. If municipal workers, who earn more than $60,000 per year plus benefits, were compensated in line with private sector norms, the savings to cities could be spent on improving civic amenities and upgrading infrastructure.
The municipal compensation gap varies across the country, says the report.
Municipalities in Quebec (23 per cent), Ontario (21 per cent) and New Brunswick (19 per cent) have the biggest imbalances.
Individually, Toronto (26 per cent) and Montreal (25 per cent) are the worst offenders.
Inflated public sector wages and benefits hurt all Canadians. It creates a two-tier workplace system. The public sector worker has job security, great benefits and a high income. The private sector worker has zero job security, can expect to be laid off at any time, has modest benefits and has to work really hard to earn a decent wage. And to make matters worse, thanks to paying public sector employees above the norm salaries and benefits, higher taxes and fees are borne by private sector employees.
The report suggests that employee raises should be controlled until the compensation gap is eliminated.