“There’s a huge legacy in the public sector of austerity measures that the private sector just isn’t feeling in the same way,” says Anna Penfold, client partner, HR practice, at executive recruitment and talent management consultancy Korn Ferry of her experience working with clients in the public sector. “The commercial world had to make cuts more quickly and more deeply and that’s perhaps still feeding through to the public sector. Cost cutting and redundancies will continue for the next two years.”
“Recession hit us all but austerity has only hit the public sector,” agrees Barry Pirie, associate director of people and policy at Wiltshire District Council and new president of the Public Sector People Managers’ Association (PPMA).
Talent retention is a particular challenge for the public sector, he says. “The private sector can offer higher salaries and better packages to grab some of that talent. But we have fairly rigid terms and conditions and pay constraints. So we have to think more creatively to retain top talent.”
But while recovery might be slower here, the public sector has, like its private counterpart, also in many ways benefited from the radical shake-up brought by recession, believes Pirie.
Pirie cites the example of Wiltshire District Council, where 252 senior middle managers were taken out of the structure in the first year of the recession to make an £8.25 million saving, but where, despite simultaneous terms and conditions reductions, surveys have shown boosted employee engagement.
Pirie reports that many councils have taken lessons from the private sector regarding expectations placed on managers. “In the private sector an operational manager is expected to get on and manage staff without needing HR to do it for them, whereas in the public sector there was at times that expectation. That’s no longer possible,” he says.
Other positive initiatives have included partnership work on HR, and finance and asset management with other local authorities to cut costs.
“We’ve talked about partnership working, for example, for decades,” says Pirie. “We’ve talked about becoming more efficient and working differently. Now we’ve had this burning platform and it’s forced us into repositioning, into doing some things we know we should have done years ago.”