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# Why does public administration capture 8.8% of employee compensation from 5.9% of hours worked?
- URL: https://www.benchmarkanalytics.com.au/public-administration-compensation-hours-worked/
- Published: 2026-09-06T10:50:25.000Z
- Updated: 2026-09-06T10:50:25.000Z
- Description: Public Administration and Safety accounts for less than 6% of Australian hours worked but almost 9% of employee compensation — the largest positive gap of any industry. The statistic raises an intriguing question about why.
- Author: Nick Hossack
- Tags: Labour Market, ABS, Public Sector, Wages, Productivity, Government

Australia’s Labour Account reveals an unusual mismatch in **Public Administration and Safety**.

In the June quarter 2026, the industry accounted for **5.85% of all hours actually worked but 8.80% of total employee compensation**. The resulting **+2.95 percentage-point gap is the largest of any Australian industry**.

Put another way, employee compensation equated to about **$89.75 for each hour worked** in Public Administration and Safety, compared with **$59.69 across all industries** — a premium of roughly 50%.

For some industries, a large premium has an intuitive economic explanation. Mining, for example, generated 3.38% of employee compensation from 2.07% of hours worked. Mining is extraordinarily capital intensive and uses scarce specialised labour.

Public administration is less obvious.

The ABS category is broader than office-based bureaucracy: it includes government administration and courts, defence, police, fire and emergency services, corrections, regulation and border control.

Possible explanations include a relatively highly skilled workforce, public-sector wage structures and bargaining, overtime and allowances in safety occupations, higher employer superannuation contributions, or the outsourcing of lower-paid support functions into other industries.

None necessarily provides the full explanation.

Nor should the statistic be interpreted as proof of excessive public-sector pay or unusually high productivity. Public administration largely produces **non-market services**, making economic output and productivity particularly difficult to value.

But the question remains intriguing: **why does an industry responsible for less than 6% of Australia’s working hours receive almost 9% of employee compensation?**

*Source: ABS, Labour Account Australia, June 2026, released 4 September 2026; seasonally adjusted industry series. Compensation of employees includes wages and salaries plus employer social contributions. Benchmark Analytics calculations from the industry data.* 

Where compensation exceeds the share of hours worked 

June quarter 2026, seasonally adjusted 

| Industry                             | Hours | Compensation | Gap     |
| ------------------------------------ | ----- | ------------ | ------- |
| Public administration & safety       | 5.85% | 8.80%        | +2.95pp |
| Professional, scientific & technical | 9.10% | 10.81%       | +1.72pp |
| Financial & insurance services       | 3.63% | 5.21%        | +1.58pp |
| Mining                               | 2.07% | 3.38%        | +1.31pp |
| Administrative & support services    | 4.81% | 5.88%        | +1.07pp |
| Education & training                 | 7.68% | 8.65%        | +0.97pp |

Public Administration & Safety

$89.75 compensation per hour worked 

versus $59.69 across all Australian industries 

Source: ABS, Labour Account Australia, June 2026\. Seasonally adjusted. Gap equals industry's share of total employee compensation less its share of total hours actually worked. Benchmark Analytics calculations.