Let’s keep what we spend in tune with what we earn

I've lived in Serbia for the last 10 years, those wage figures you have given are fantasy, do you rely on researchers? or just pluck figures from the sky?

Dear All,

This article is one of many that Simon wrote for Serbian media. He covers various topics and this time he decided to focus on the role the wage bill plays in the macro stability of Serbian economy (in others he covered pensions, education, public utilities, productivity…).

The source of the data used in the article is official. The comparisons refer to ten countries in Europe and Central Asia Region (Albania, Armenia, Croatia, Georgia, Kyrgyz Republic, Poland, Romania, Slovak Republic, Turkey, and Ukraine) and the seven countries outside the Region include: Chile, Ireland, Korea, Spain, Thailand, Uganda, and Vietnam.

Vesna Kostic, External Affairs Officer, the World Bank country Office in Serbia

This article failed to mention, as did Ms. Kostic's clarification, The Wages earned at the World Bank. At a time when World governments are being forced to nationalize the damages of the banking communities greed, the World Bank feels it should explain why Serbian wages should be lower than the rate of inflation.

John Davis,

I wouldn't discredit Mr. Gary that fast, he does make a good point. The salary of public payed servants in Serbia do surpasse the average wage of private sector employees. This has by far always been a problem in Serbia. But I am suprised that Mr. Gary did not point out so many other factors which play an even bigger role in the destablization of the Serbian economy. Even tough I can not agree or disagree with his numbers, they are accurate by the fact that public sector pays more than the private sector. In conclusion Serbia spends more than it can produce. Loans from the IMF, WB, paris Club...etc are the only factors which get our country through the fiscal crisis every year. It is also very important not to forget that every sum of money we got from the EU "FUND" came with very worrysome conditions and obligations, which to my regret the citizens of Serbia will never be informed of.

The government has pretty much sold off every asset it has in order to pay its dedts and the interest upon it. There are only several more companies that will go and thats it poeple, Serbia offically does not have anything in its name. NO industry that it can call its own.

A grusome reality

I don’t know which exactly was the sample of countries in Europe and Central Asia you considered concerning the public sector wage expenditures.
French gouvernement in april 2008 edited a “Livre Blanc” about the public service.
In France more than 7 million people, more than 28% of the working population, works for public service!!!
Referring to OCDE numbers for year 2005, the public sector wage expenditures represented 13,1% GDP !!! (Italy 11%, GB under 10%, Germany 7,2%, Japan 6,3%)
But in the same document you can read that the total cost of operation of the public sector (including wages and other expenditures of operation but excluding intervention and investment credits) establishes as follows:
GB 21,5% of GDP
Canada 19% of GDP
France 18% of GDP
US 17,5% of GDP
Italy 16 % of GDP
Germany 11,5% of GDP
Japan 10% of GDP
My point is that it is a very current error that wages should be considered as the only variable of adjustment.
For instance, a university professor in Serbia earns a monthly wage about 600 Euros. In France, for the same position salary is above 3000 Euros! If there’s no reasonable leveling of wages, qualified people will simply leave the country and the “brain drain” would harm Serbia more than to spend a little more.
I have to agree that it is unjustifiable for employees in monopolies to have substantially higher salaries than those paid for identical positions in the labor market and the best thing to do would be to return those monopolies to the private sector where they belong except for those who have a clear mission of public service. But, as everybody knows, most of those public enterprises are largely overstaffed and to return them to the market economy without considering the social consequences would be a big error!
One of the most current errors of the World Bank is to see only numbers and never give a thought about the people who have to suffer the consequences!
Concerning the title of your viewpoint, it would be a good advice for the USA which, for a long time already are living on credit!

Oh Joachim, please give us the address of that French university paying above 3K Euro wages for their educational staff, so that I may inform my superiors here in Strasbourg. I am sure we would all love to hear if this is not just a fairy tale of yours.

It seems to me that this panel is not very representatif: Albania, Armenia, Croatia, Georgia, Kyrgyz Republic, Poland, Romania, Slovak Republic, Turkey, and Ukraine for Europe :) and Chile, Ireland, Korea, Spain, Thailand, Uganda, and Vietnam as seven countries outside the Region :)
I have to admit that I don't understand very well why Ireland or Spain are outside the european region, but anyway,

I think that if the choice of panel countries is right you could prove about everything you would like to prove!

Talking about Europe without talking about the main players (UK, France, Germany, Italy, Spain...) is as nonsense as is to talk about Asia without talking about the main players ( Japan, China...)

Your theories are proven wrong! People of Argentina know something about this!!
No need for Serbia to try the same false path! The more she stays away of World Bank, IMF, the better she's going!!!

John Davis,

I wouldn't discredit Mr. Gary that fast, he does make a good point. The salary of public payed servants in Serbia do surpasse the average wage of private sector employees. This has by far always been a problem in Serbia. But I am suprised that Mr. Gary did not point out so many other factors which play an even bigger role in the destablization of the Serbian economy. Even tough I can not agree or disagree with his numbers, they are accurate by the fact that public sector pays more than the private sector. In conclusion Serbia spends more than it can produce. Loans from the IMF, WB, paris Club...etc are the only factors which get our country through the fiscal crisis every year. It is also very important not to forget that every sum of money we got from the EU "FUND" came with very worrysome conditions and obligations, which to my regret the citizens of Serbia will never be informed of.

The government has pretty much sold off every asset it has in order to pay its dedts and the interest upon it. There are only several more companies that will go and thats it poeple, Serbia offically does not have anything in its name. NO industry that it can call its own.

A grusome reality

I've lived in Serbia for the last 10 years, those wage figures you have given are fantasy, do you rely on researchers? or just pluck figures from the sky?

I don’t know which exactly was the sample of countries in Europe and Central Asia you considered concerning the public sector wage expenditures.
French gouvernement in april 2008 edited a “Livre Blanc” about the public service.
In France more than 7 million people, more than 28% of the working population, works for public service!!!
Referring to OCDE numbers for year 2005, the public sector wage expenditures represented 13,1% GDP !!! (Italy 11%, GB under 10%, Germany 7,2%, Japan 6,3%)
But in the same document you can read that the total cost of operation of the public sector (including wages and other expenditures of operation but excluding intervention and investment credits) establishes as follows:
GB 21,5% of GDP
Canada 19% of GDP
France 18% of GDP
US 17,5% of GDP
Italy 16 % of GDP
Germany 11,5% of GDP
Japan 10% of GDP
My point is that it is a very current error that wages should be considered as the only variable of adjustment.
For instance, a university professor in Serbia earns a monthly wage about 600 Euros. In France, for the same position salary is above 3000 Euros! If there’s no reasonable leveling of wages, qualified people will simply leave the country and the “brain drain” would harm Serbia more than to spend a little more.
I have to agree that it is unjustifiable for employees in monopolies to have substantially higher salaries than those paid for identical positions in the labor market and the best thing to do would be to return those monopolies to the private sector where they belong except for those who have a clear mission of public service. But, as everybody knows, most of those public enterprises are largely overstaffed and to return them to the market economy without considering the social consequences would be a big error!
One of the most current errors of the World Bank is to see only numbers and never give a thought about the people who have to suffer the consequences!
Concerning the title of your viewpoint, it would be a good advice for the USA which, for a long time already are living on credit!

Oh Joachim, please give us the address of that French university paying above 3K Euro wages for their educational staff, so that I may inform my superiors here in Strasbourg. I am sure we would all love to hear if this is not just a fairy tale of yours.

Dear All,

This article is one of many that Simon wrote for Serbian media. He covers various topics and this time he decided to focus on the role the wage bill plays in the macro stability of Serbian economy (in others he covered pensions, education, public utilities, productivity…).

The source of the data used in the article is official. The comparisons refer to ten countries in Europe and Central Asia Region (Albania, Armenia, Croatia, Georgia, Kyrgyz Republic, Poland, Romania, Slovak Republic, Turkey, and Ukraine) and the seven countries outside the Region include: Chile, Ireland, Korea, Spain, Thailand, Uganda, and Vietnam.

Vesna Kostic, External Affairs Officer, the World Bank country Office in Serbia

This article failed to mention, as did Ms. Kostic's clarification, The Wages earned at the World Bank. At a time when World governments are being forced to nationalize the damages of the banking communities greed, the World Bank feels it should explain why Serbian wages should be lower than the rate of inflation.

It seems to me that this panel is not very representatif: Albania, Armenia, Croatia, Georgia, Kyrgyz Republic, Poland, Romania, Slovak Republic, Turkey, and Ukraine for Europe :) and Chile, Ireland, Korea, Spain, Thailand, Uganda, and Vietnam as seven countries outside the Region :)
I have to admit that I don't understand very well why Ireland or Spain are outside the european region, but anyway,

I think that if the choice of panel countries is right you could prove about everything you would like to prove!

Talking about Europe without talking about the main players (UK, France, Germany, Italy, Spain...) is as nonsense as is to talk about Asia without talking about the main players ( Japan, China...)

Your theories are proven wrong! People of Argentina know something about this!!
No need for Serbia to try the same false path! The more she stays away of World Bank, IMF, the better she's going!!!