Technical Assistance Reports

Republic of Palau: Technical Assistance Report-Managing Government Employment and Compensation

Publication Date:

March 29, 2024

Electronic Access:

Free Download. Use the free Adobe Acrobat Reader to view this PDF file

Summary:

Upon the authorities’ request, the IMF’s Fiscal Affairs Department provided technical assistance to Palau on reforming government employment and compensation policies. Palau is facing significant challenges in recruiting and retaining qualified staff for essential public services due to emigration. The government's compensation structure has become increasingly compressed, making it difficult to recruit and retain skilled workers, particularly in the health and education sectors. The mission suggested that targeted pay increases, subject to available fiscal space, could alleviate these issues. Additionally, innovative approaches, such as merging some state government functions with the national government and facilitating the recruitment of foreign workers, could improve public service delivery efficiency. The recent establishment of the Employment and Compensation Committee (ECC) marks a significant step towards the necessary development of a medium-term strategy to address these challenges.

Series:

Technical Assistance Report No. 2024/027

Subject:

Employment Human capital International organization Labor Labor force Monetary policy Public employment Wages

Frequency:

regular