Measuring the Size and Cost of Manitoba’s and Saskatchewan’s Public Sectors

Commentary, Public Sector, Joseph Quesnel

In September 2014, the Atlantic Institute for Market Studies (AIMS) released a policy paper that looked at the size and cost of Atlantic Canada’s public sector. AIMS researchers Ben Eisen and Shaun Fantauzzo examined Statistics Canada data to empirically assess the claim that Atlantic Canada’s public sector is unusually large compared with other regions of the country. After careful analysis, they discovered that public sector employment rates in the Atlantic region, relative to population, are higher than the rates in the rest of Canada.

Using the methodology of that policy paper, this study examines the size of the public sector in Manitoba and Saskatchewan as well as the financial implications of sustaining these sectors for both the government and the taxpayers. We began by assessing the size of Manitoba’s and Saskatchewan’s public sectors relative to all jobs. In order to reflect the way in which the public sector directly affects a province’s tax base and its policy-makers, we then narrowed our focus to the sub-national public sector. Following that, we assessed the size of the sub-national public sector relative to the province’s entire population, which we used to calculate the additional spending of each province on the public sector wage bill. We find the size and cost of public sector employment in Manitoba and Saskatchewan is indeed higher than the national average. After that we explore how the provinces can bring the size of their public sectors in line with Canadian standards without resorting to drastic layoffs that could be detrimental to government and public services.

In 2011, the Frontier Centre released a similar study written by one of the authors of the AIMS policy paper. Frontier’s study looked at the size of Manitoba’s public sector and examined the notion that Manitoba had an unusually large public sector relative to the other provinces. After carefully analyzing data from Statistics Canada, the Frontier Centre’s study found that Manitoba’s government sector is much larger than that of most other provinces. Specifically, the rate of government employment at the combined provincial and local levels relative to population is high by Canadian standards. This study will demonstrate that Manitoba’s public sector has grown even further since 2011, and it will continue to build upon that previous work by adding Saskatchewan to the mix.

View entire study here.