How to Set Compensation for Government Employees
IMF How To Notes, April 4, 2024
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- How to Set Compensation for Government Employees
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Bibliographic details
- Authors: Celine Thevenot, Sébastien Walker
- Published: April 4, 2024
- Series: IMF How To Notes
- DOI: https://doi.org/10.5089/9798400272653.061
Summary
- Government compensation-setting should be informed by the monitoring of trends in recruitment and retention and benchmarking against the private sector.
- Unduly high compensation is an inefficient use of resources, while insufficient compensation can hinder efforts to recruit, retain, and motivate the workforce needed to deliver adequate public services.
- Analyzing these factors at a granular level, for example, by occupation or position, can help to identify specific challenges.
Key findings and themes
- Recruitment and retention trends are central to effective compensation-setting.
- Benchmarking against the private sector is necessary to evaluate the competitiveness of government compensation.
- Both excessively high and insufficient compensation carry costs: inefficiency versus impaired service delivery capacity.
- Granular analysis (by occupation or position) improves the ability to identify and address specific compensation challenges.
Policy implications and recommendations
- Monitor trends in recruitment and retention systematically to inform compensation policy.
- Use private-sector benchmarks to assess the adequacy and competitiveness of government pay and non-wage benefits.
- Avoid unduly high compensation as it constitutes an inefficient use of scarce public resources.
- Address insufficient compensation to prevent recruitment and retention shortfalls that undermine public service delivery.
- Conduct granular, occupation- or position-level analysis to tailor compensation responses to specific challenges.
Content in this bundle
- How to Set Compensation for Government Employees