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Who Enters the Public Sector?

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Listed:
  • Clara von Bismarck-Osten

Abstract

Is the public sector losing the most educated to finance, tech, and consulting? Does it act as a Keynesian employment insurer to the less educated? The data constraints behind the limited evidence on this have recently been overcome for England. The probability of entering the public sector rises with education, and this paper documents that this educational gradient has strengthened. Relative to just before the financial crisis, the public sector became a less common workplace for individuals entering the labour market with low levels of education. At the same time, it became a more common destination for the most educated, whether defined by highest qualification, university rank, or final grade. Graduates from top universities do show increased entry into finance, the tech sector, and the consulting industry, but also show-despite a substantial deterioration of pay differentials-an increasing preference for the public sector as an entry-workplace. A decomposition of the trends by graduate discipline and destination industry points to UK-specific policy explanations.

Suggested Citation

  • Clara von Bismarck-Osten, 2026. "Who Enters the Public Sector?," RFBerlin Discussion Paper Series 26094, ROCKWOOL Foundation Berlin (RFBerlin).
    • Handle: RePEc:crm:wpaper:26094
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    References listed on IDEAS

    as
    1. Fabien Postel-Vinay & Hélène Turon, 2007. "The Public Pay Gap in Britain: Small Differences That (Don't?) Matter," Economic Journal, Royal Economic Society, vol. 117(523), pages 1460-1503, October.
    2. Fabien Postel-Vinay, 2015. "Does it pay to be a public-sector employee?," World of Labour, LISER, pages 156-156, June.
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    Keywords

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    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets

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