Growth of public sector is masking a jobs crisis in Switzerland

The restaurant industry was hit hardest by the pandemic in terms of job losses. Keystone / Gian Ehrenzeller

Employment statistics show that addition of jobs in the public sector is helping deflect a major collapse in employment in Switzerland. 

On Sunday, the SonntagsBlick reported on this development based on an analysis of employment statistics. At the top of the biggest losers in jobs is the gastronomy sector. At the end of the third quarter of 2020, Swiss bars, cafés and restaurants employed 168,200 people, some 23,000 fewer than in the previous year. The hotel sector is also one of the big losers, with 6,200 jobs lost in one year. 

By contrast, the health and social services sector now employs 764,300 people, 17,400 more than in the previous year. It is the leading sector in terms of staff growth. Public administration ranks second with an increase of 7,500 employees. The education and training sector saw the third biggest growth with an additional 7300 employees.

How sustainable?

According to the SonntagsBlick, this is not a new development. Even in earlier years, an above-average number of jobs were created in these public sector areas, which are mainly financed by taxpayers and health insurance premiums. This apparently long-term trend is continuing despite the pandemic.

When questioned on the sustainability of these public sector jobs, the State Secretariat for Economic Affairs (SECO) attributed the growth to the development of the knowledge society, an ageing demographic and rising prosperity levels. Another factor is that the education and health sectors are very personnel-intensive and the potential for automation is rather smaller than in other sectors such as industry. However, SECO conceded that sustainable economic growth cannot be based on state-related services alone.

Overall, the job situation is still better than at the height of the pandemic. In contrast to the peak in April, when more than 1.3 million people were on short-time work, the number was down to 204,200 in September. However, this week SECO announced that the second wave was causing demand for short-time work to rise again – and that was before the Federal Council announced the new measures on Friday on restricting opening hours of shops and restaurants.