<mark>of schooling but employed in selected sectors: Government Administration, Health and Social Relief, Education and Training, Agriculture and Agricultural Services, and Private Sector and State-owned Enterprises. Analysis was conducted by a trained statistician, guided by a World Bank staffer with expertise in the LECS and the</mark> international consultant charged with carrying out the civil service pay component of the study.

<mark>The worker analysis faced two main limitations. First, the data were not normalized for the number of hours worked and thus represented reported monthly earnings per respondent, regardless of actual working time. Second, because Lao PDR is a largely agrarian society with relatively few wage-workers in the country and thus in the LECS sample, the mean earnings calculations had a large standard deviation, indicating a substantial degree of uncertainty. These limitations meant that although the analysis yielded useful insights, it was difficult</mark> to draw definitive conclusions.

For the jobs analysis, information on pay in small- and medium-sized private enterprises in Armenia was available from a survey conducted by the National Institute for Labor and Social Research, while a separate commercial survey provided insights into earnings in a small number of elite employers, including Armenian and international entities. The first survey enabled a comparative analysis of benefits, employment stability and working hours—factors that are often mentioned as adding to the appeal of public sector work but are rarely quantified. Findings clearly showed that the public sector came out ahead of the private sector on all three factors. Virtually all government jobs are permanent (99% overall), but only 70% of private sector workers reported having a permanent job. Government workers had a shorter workweek overall (41.4 hours compared to 47.3 hours in the private sector) and even more so for university-educated workers (39.7 hours versus 48.7 hours). The most dramatic difference was in benefits: 85 percent of government wage earners received paid holiday and sick leave, compared to only 17 percent of private sector workers (30 percent when looking only at university-educated workers in the private sector). Taken together these findings suggested that, where public sector workers in Armenia do earn less than their private sector counterparts, the difference may be made up by better provision of benefits, greater employment security, and shorter working hours.

In Lao PDR, a commercial survey provided information on a small number of elite employers that were not deemed to be realistic alternatives for the vast majority of civil servants; thus we conducted a customized survey of private sector employers (detailed in Box 3).

# **Box 3: Pay Comparison in Lao PDR—A Jobs-based Employer Survey**

<mark>The customized survey of employers gathered earnings data for an array of jobs by interviewing employers who included, in addition to ministries, a mix of private firms, state-owned enterprises, and commercial banks, all located in the capital city—a selection best described as a convenience sample. The survey focused on typical domestic employers that might be a realistic option for the average job-seeker; some of the firms had foreign partners or investors and one was foreign-owned. International organizations, non-governmental organizations, and large international corporations and their Lao subsidiaries were excluded, since these generally employ a relatively small, elite staff who are highly paid relative to the local market. Firms ranged in size from very small</mark> (three staff) to very large by local standards (five hundred or more staff).

<mark>Selection factors included the general profile of the jobs offered (managerial, professional white collar, support), the sphere of activity, and whether the jobs are reasonably common in the Lao market. Health and education service delivery jobs were excluded, since there are relatively few formal private sector employers for these professions. The focus was on white collar office jobs—but some service and industrial jobs were included as comparators, both for context and because they may be alternatives for some rank-and-file civil servants. Firms were initially approached in writing or by telephone. Given the sensitive nature of the subject, participants were promised confidentiality and anonymity—hence company names were not released and survey findings were presented so as to prevent individual employers being identified. On the whole, employers welcomed the</mark> opportunity to participate and expressed great interest and openness in discussing labor market issues.

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