Numbers released by the Ministry of Administrative reform show the extent to which the public sector has been shrunk since Greece entered the Memorandum agreement. Today almost 30 per cent fewer individuals work in the public sector compared to 2009.

According to the figures, in 2009 the number of people working in the state sector either as permanent employees or on fixed term contracts came to 952,625 people. In December of 2013 that number had fallen to 675,530 – a drop of 277,095, or about 70,000 per year.

The group most impacted by the drive to shrink the public sector were those on fixed term contracts that were not renewed. In 2009, 148,634 people were employed in the state sector on that basis, however the vast majority lost their positions as a result of the government’s drive to reduce payroll costs. By December 2013 only 12,196 people remained employed on fixed term contracts.

The numbers highlight the indiscriminate nature of the cuts to the public sector. It should be noted that in many cases those on fixed term (and often low paid) contracts provided valuable services to ministries and municipalities, however it was legally much easier for the government to meet its Memorandum targets simply by not renewing those contracts rather than lay-off permanently employed state workers.

Similarly, the majority of the remaining public sector reductions stem from individuals who retired and were not subsequently replaced. New hirings by the public sector have effectively been put on ice since the outbreak of the crisis. While this practice has allowed the government to reduce its payroll costs without directly increasing unemployment, it also means that the country’s biggest employer has all but stopped hiring young people, thus indirectly increasing youth unemployment, which stands at well over 50 per cent.

The reduction in staff numbers has occurred in parallel with drastic cuts in public sector salaries. As a result the payroll cost has dropped from 24.5 billion euros initially to approximately 15.8 billion euros.

Prior to the crisis Greece’s public sector spending in relation to GDP was below the European average.

Source: the pressproject