Abstracts
Résumé
Vu qu'un grand nombre d'emplois du secteur public n'ont pas de point de comparaison dans le marche, les auteurs suggèrent une méthode de comparaison avec des professions comparable
Abstract
The comparison of wages between the public and the private sector for comparable workers is well documented in the collective bargaining scene in Canada. However, in many cases it happens that there are no strictly comparable employees in the private sector. Such is the case, for example, for teachers, nurses, police officers, etc. In that case, one must develop alternative methods in order to make acceptable and valuable comparisons. This article suggests a comparison of wages between comparable occupations. This method is essentially based on the theory of human capital. We explicitly consider general education and specific training as a basis for occupational comparisons.
Our paper is divided into two sections. The first section develops the theoretical framework while the second section provides evidence for the case of the Montreal Urban Community police officers.
To begin with, we recall the general principle that education is comparable to an investment. It has both costs and returns. Its costs are mainly the opportunity cost of a full time job plus the costs and fees associated with education itself. Its benefits are the present value of the total expected additional income generated by the acquisition of a diploma.
Training or experience is also expected to provide an additional income that will decline overtime. By combining both education and experience, once is able to estimate the income profile of typical individuals who have acquired different levels of education. We can also compute the internal rate of return for any specific occupation.
This technique was applied to the Montreal Urban Community police officers and to a group of occupations that required the same basic general education and specific training background. This was done by using a regression model where wage determination is a function of standard factors such as age, sex, education and so forth. The data came from the 1981 Census which contains 14856 individuals observations on wages and other relevant factors. We have obtained results which are statistically very good and comparable to results obtained in other studies in the same field of research.
From these results, we were able to establish that the rate of return obtained by comparable occupations from college education was 10%. The same rate of return for MUC police officers is estimated at 25%. The application of the human capital theory also led to another interesting result. We built a «basket» of comparable occupations. The latter were comparable in terms of general and professional training (Canadian occupational classification code) as well as job hazards (the data being provided by the Commission de la Sante et de la Securite du travail du Quebec). On the average, MUC police officers showed a positive wage advantage of 45% over the comparable «basket» of occupations (39% if one standardizes for differences in the degree of unionization).
Such a technique does not standardize comparisons for factors such as the size of the firm, management responsibilities, regulation of the profession, etc. However, given that any occupation has on that respect different specifities, it appears recommendable to include a large array of comparable occupations in the composition of the «basket».
Mandatory arbitration is the legal outcome of a workers dispute in the case of police officers in Quebec. Both political and economic forces are then at play. It is our contention that this approach can bring relevant economic informations in the process of wage seulement. However, the method in itself is not strictly limited to the area of municipal police officers, but can easily be extended to other specific employees of the public sector that are said to be non comparable at first sight.