Public service investment, an important driver for the Canadian economy?

MONTREAL, Sept. 25, 2019 /CNW Telbec/ - Public service investment makes the economy grow.
The question of the number of public service employees is often raised during election campaigns. IRIS (the Institute for Socioeconomic Research and Information) has analysed relevant data on economic side-effects since 1980 for each Canadian province or territory. Despite the positive impact of public service, the study underlines the overall tendency towards the reduction of the number of jobs in this sector. Notably, 25,000 jobs were cut in the federal public service in 2011.

Multiplier effect of each $1M invested in the federal public service on the GDP of provinces and territories (CNW Group/Institut de recherche et d'informations socio-économiques (IRIS))

In all provincesThe study illustrates the structural effect of the public service on economic stability, on recovery following economic slowdowns and on regions with undiversified economies. 'Public service spending contributes to the economic vitality of all Canadian provinces and territories' states François Desrochers, associate researcher at the Institute. Bertrand Schepper, co-author of the study, adds that 'on average, every dollar invested in the federal public service generates 1.77 $.'

Ecological transition
The results are even greater in regions where the economy is not very diversified. 'Money spent on the public service has a greater impact on employment and the GDP in provinces with the least economic diversity' says Mr Desrochers. Economically, public service investment in these provinces would increase their resilience and could contribute to a transition strategy away from fossil fuels.

Women and employment
Finally, women represent 63% of public sector employees and jobs in this sector are generally better than average. 'The presence of a strong public sector contributes in reducing inequalities between men and women in the work force,' concludes Bertrand Schepper.

About IRIS
A non-profit, independent, progressive research institute, IRIS was founded in 2000. It produces research on the important questions of the day (public-private partnership, fiscal policy, education, health, environment, etc.). It publishes an alternative discourse to views proposed by economic elites.

Read the study here : https://iris-recherche.qc.ca/publications/fed-public-service.

SOURCE Institut de recherche et d'informations socio-économiques (IRIS)

Laurent Deslauriers, Public relations officer, 438 862-8051, [email protected]