BUSINESS

Newfoundland and Labrador to cut 1,420 public service jobs over next five years

04/27/2015 11:08 EDT | Updated 07/30/2015 05:59 EDT
ST. JOHN'S, N.L. - The government of Newfoundland and Labrador said Monday it will cut 1,420 jobs in the public service through a five-year attrition plan in an effort to save money as the province grapples with low oil prices.

Finance Minister Ross Wiseman said the plan would save $300 million between now and 2020.

"If you were talking about trying to do this overnight, absolutely you would have a huge impact," Wiseman said at the announcement in St. John's.

"But we believe with the right planning and the right lead time and putting in place some good change management processes that we're going to be able to achieve this over a five-year period."

Wiseman said the plan is based on statistics indicating almost 40 per cent of core government workers are currently 50 or older, and that 9,000 employees will retire from public service in the province over the next five years.

The government will replace eight out of every 10 who retire or quit, leaving the remaining 20 per cent of vacated jobs empty, he said. There are no planned incentives for retirement.

More than 46,000 people are currently employed in Newfoundland and Labrador's public service.

Wiseman estimated 87 positions would be removed annually from core government departments to a total of 435 positions over the five-year period. Another 197 positions would be cut each year from organizations like health authorities and school boards, for a total of 985 jobs, he said.

Although Wiseman said the government believes all those numbers can be reached through attrition, he can't guarantee there won't be layoffs.

"As we adjust some of our work programs and services, there may be some other impacts," he said.

The cuts come as the province, which depends on its offshore energy sector for about a third of its revenues, copes with the low price of oil.

Wiseman said the government will hire a consultant in the next few days to help execute the plan. He said the provincial budget to be presented Thursday includes $300,000 to cover those costs.