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December 1, 2014

Young leaders: Deputy minister or private executive?

Are the top business grads in Canada headed for private sector employment or is government able to attract their talent?

A study surveying 400 commerce students at the business school of a Canadian university found that the students with the highest grades and work experience have the same attitudes toward working for the government as their peers. Nearly 40 percent of the students had positive attitudes toward government employment, suggesting a willingness to work for government, but many factors may influence their actual recruitment decisions.

The future of government
The 2012 Federal budget delivered by then Finance Minister, the late Jim Flaherty, announced roughly 19,200 job cuts in the public sector. In fact, the federal government has eliminated more than 20,000 public service jobs since then and expects to eliminate about another 9,000 jobs by 2016-17. In contrast, the private sector is increasingly becoming a choice employer, and has consistently shown itself able to meet the needs of the top new-graduates in Canada.

With these factors in mind, an important question becomes: Are Canada’s highest performing students choosing government work or the private sector, and what would the answer mean for the government’s ability to attract top talent, and be an effective and dynamic workplace? This question resulted in a study examining the perceptions of government and private sector employment for top performing Canadian students. The study focused specifically on students enrolled in commerce classes at the business school of a Canadian university, surveying 400 students to measure their attitudes toward working in the federal government, using GPA and work experience to identify the top students.

Public sector job cuts
The 2012 and more recent Harper budget cuts are reminiscent of the budgets delivered by the Chretien government in 1995 and 1996, when as many as 55,000 job cuts were announced. By 1997, the government reported about 30,000 cuts had taken place. More recently in 2003, the Martin government enacted a two-year hiring freeze.

After both of these program reviews, the proportion of middle-aged employees increased, and younger demographics often decreased. By 1997, 70 percent of the public service was between the ages of 35 and 54, and in 2003 33.6 percent was over 50, with only 12 percent under the age of 30. This remained largely unchanged between 2003 and 2008

The federal government is a large player in student recruitment. Since 2005 the government Post Secondary Recruitment (PSR) campaign has hired an average of 1,099 students each year, with an average of 23,511 applications per year! Over the same time it hired an average of 33 graduate or PhD students a year into its elite fast-track RPL program, with an average of 1,457 applicants per year. Much of the RPL hiring targets Canadian grads at foreign universities like Harvard or Oxford. For perspective, the PSR annual hires only account for about 2.14 percent of total external hires made by the government in a year.

Attitudes of top students
Perhaps surprisingly, no significant difference was found between top performers and other students in terms of what job characteristics they find most important, or their attitudes toward government employment. This is significant because it means that at least from this sample, the highest achieving students seem equally willing to work in government as their peers.

Students were asked to rate various job characteristics to determine which were the most important to them. The five job characteristics students in the survey care most about are 1) advancement opportunities; 2) job security; 3) total compensation; 4) flexibility and work-life balance; and 5) benefits and perks.

Examining which sector was chosen to best offer each characteristic, and weighting for each characteristic’s overall rating by students, the private sector scored 12 percent higher than the public sector in its ability to offer each job characteristic. Students indicated that they think the private sector can better offer them the job characteristics they desire, but only by a modest margin over the public sector.

A large portion (43%) of students think that government offers the characteristics they want in a job, and many (40%) would consider the government in their top five most preferred employers. This apparent popularity mirrors ratings for the government of Canada in the annual Top Campus Employers survey conducted by Universum, where the government ranked third behind only Google and Ernst and Young in 2014.

The current study also found that students’ ratings for total compensation or performance pay as job characteristics had a negative relationship with positive attitudes toward government employment, while students’ ratings for flexibility/work-life balance, and job security had a positive relationship with positive government employment attitudes. It seems that those concerned with monetary characteristics were not as likely to want to work in government, which is consistent with previous research. Those who valued flexibility or security were more positive about government work.

Another interesting finding was that students with a general specialization (as opposed to accounting, or marketing for example) had the most positive attitudes of government employment, followed by those with human resources specializations.

Is that the full story?
Attitudes of top talent only tell part of the story. There are many other factors or barriers that will affect the government’s ability to get top students in the door. To gain a first-hand perspective, two recruits into the government’s elite Recruitment of Policy Leaders program were interviewed: one who works for the federal government and one who chose an elite private sector position. Both have PhD’s from a world-class foreign university.

Both interviewees agreed that civil servants they dealt with are very proud of their jobs, which job seekers could see as a positive reflection of the work in the sector. The interviewees spoke of bureaucracy in the government, which can be very frustrating for young high-achievers who want to move fast and gain responsibility. They also both agree the government needs to do a better job of recruiting from the private sector to staff vacancies rather than focusing so heavily on internal hierarchical movement. This last point is important because having these top performers in government later in their careers can be extremely beneficial.

Our public sector interviewee enjoyed the flexibility and commitment of government because it allowed her to finish her PhD knowing that she could go work in RPL after she was done. This is an important consideration, as government work may be well-suited and even favour arts or sciences students pursuing advanced degrees. She also thinks that the government can do more by collaborating with think tanks and the private sector in a way that makes employment transitions from these organizations into the government easier.

Our private sector interviewee suggests the government needs to be more aggressive in recruiting and make earlier offers to get the attention of and receive acceptances from the best students. This assertion is a major one, as something as simple as offer timing or recruitment presence can have profound effects on an employer’s ability to sign the top graduates.

Also often discussed in government circles and think tanks are barriers such as a cumbersome recruiting processes, geographic barriers, or lower pay for organizational leaders. For example, a top grad from British Columbia may see moving to Ottawa to work for the government as a barrier to choosing federal public service. A top finance grad may see the compensation gap between private and government executives as a barrier – a gap, which in 2011, was $475,800 between the highest government executive level tracked (deputy ministers) and comparable private sector executives.

What does this mean?
This research shows that at least in the sample, there is no difference in attitudes toward government work between the average and top students. There is an apparent willingness to work in government, but the conversion rate of willing, high-achieving grads to being hired as public servants is unclear. An important finding was that the private sector is more popular amongst students by a margin of about 12 percent overall, as measured by the job characteristics in the study.

Certain job characteristic preferences also emerged as important for government recruiters to understand, as they could be indicative of an applicant’s willingness to work in government. Pay related characteristics correlated negatively to a desire to work in government, while flexibility and job security correlated positively to a desire for government employment.

Many factors remain to be discussed that can turn top employees away from government employment. The government needs to find which of these are the most important, and begin to remove barriers or improve their end of the relationship to ensure they are able to recruit and retain Canada’s future leaders.

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