Should I Move From Private To Public Industry? And Vice Versa?

This is a question a lot of professionals ask themselves at some point in their careers. There comes a point where a slower pace and a pension start to look very tempting. I made the switch once… and then went back to private, and then did it again, and then again. I've now been in the private sector for 10 years.

There are plenty of reasons to prefer either one, so in this post I want to take the time to lay out the pros and cons, highlight some gotchas nobody warned me about, and give you a list of things to think through before you decide. I've worked for both the provincial government (Ontario) and the federal government, so I'll speak to both.

One note before we start - this is written from the point of view of an engineer. If you're in a different profession, parts of this will still apply, but the salary dynamics, licensing, and day-to-day work may look different for you.

And to be clear, I'm not here to tell you which one is better. I've left both sides, and I've gone back to both sides. The right answer depends on where you are in life, what you want your money to do, and how you handle different kinds of stress.

Be ready. This is a monster post that took me a while to write.

First - the landscape changed in 2026

If the last time you seriously looked at this was during the pandemic, a lot of your assumptions are probably out of date.

• Ontario Public Service is back in the office full time. All OPS staff and provincial agencies were required to return five days a week as of January 5, 2026. Now, I hear from old colleagues that there are a lot of special arrangements and exceptions but the bottom line is - be ready to spend more time in the office than before.
• Federal public servants are at four days a week. Executives went to five days in May 2026, and everyone else in the core public service went to a minimum of four days on July 6, 2026 (some departments delayed this because they literally didn't have enough desks). Again - I hear from old colleagues that there are special arrangements and exceptions.
• The federal government is cutting jobs. Budget 2025 set out a plan to cut roughly 28,000 positions over four years. In January 2026 alone, tens of thousands of workforce adjustment notices went out across dozens of departments, and PIPSC (the union that represents federal engineers) described it as a "Hunger Games-style fight for jobs." Government jobs are not always completely secure. 

So two of the classic reasons people go public (work flexibility and "you'll never get laid off") are a lot shakier than they were a few years ago. Keep that in mind as you read the rest.

The quick comparison

These are tendencies, not rules. There are stressful government jobs and relaxed private ones.

Now let's go through each one properly.

1. Salary

From my own experience, this is the biggest difference, and it's the one that keeps pulling me back to private - for high-performing engineers, private sector salaries are significantly higher.

But "the private sector pays more" isn't universally true, and that's where people get confused.

• On average, government pays more. The Fraser Institute's 2025 report found that, after controlling for things like age, education, occupation, and location, government workers across Canada earned about 4.8% more in wages than comparable private-sector workers in 2024.
• But averages hide compression. Public pay scales tend to lift the bottom and flatten the top. A junior engineer or an average performer may do as well or better in government. A senior engineer who's very good at their job, or who can manage people and projects, will usually hit the public ceiling long before they hit the private one.
• Engineers specifically have felt this squeeze. Ontario's government engineers (PEGO) spent nearly two years without a contract and went on work-to-rule before reaching a deal in early 2025. Their association said members sometimes earned about half of what people in similar roles at municipalities were making. I can confirm that this was the case many years ago so I am not surprised to read that this continued to be a problem.

A few structural things to understand about public pay:

• You are slotted into a band with steps. You typically move up one step a year or two until you hit the top of your band. After that, the only raises are the across-the-board increases negotiated by your union, until you win a promotion.
• You can't really negotiate. At best, you can argue for where you start within the band based on your experience. There's no "I have a competing offer" conversation. Believe me, I tried that and it didn’t work.
• Your salary may be public. In Ontario, anyone earning $100,000 or more in the broader public sector shows up on the Sunshine List, with name, title, and pay. That threshold hasn't been adjusted for inflation since 1996, and the 2025 list passed 400,000 names. Most mid-career government engineers will be on it.

Questions to ask yourself:

• Where am I on the performance curve, honestly? Am I getting paid for being exceptional right now?
• Which band and step would I start at in the public role, and what's the top of that band?
• How long until I'd hit the max, and what does the promotion path realistically look like after that?

My experience, in the late 2000s/early 2010s, was that junior engineers started at a slightly higher salary at the government. In my experience and circle of friends, government salaries were about 12% higher than private salaries around that time, mainly because private industry got hit hard by the recession. However, within 2 years, salaries equalized. Fast forward a few years, I was making 30% less working at the government than if I had stayed in the private sector. When I left the government for the last time, I received an immediate 30% pay bump. Ten years later, I am making double what I was making at the government and about 40% more than where I would have been at the top of my band and position had I stayed. Of course the money comes at a cost as you will see below.

2. Bonuses and equity

In private, bonuses can be a meaningful part of total compensation, sometimes 5 - 20% or more on top of base, plus stock, RSUs or options at some companies. At my first private job, the bonuses and equity made up close to 25% of my overall compensation on good years. Bonuses and equity only make up around 5% of my current salary. In government, there's essentially no bonus for engineers. Performance pay exists, but mostly for executives.

The catch with private bonuses is that they're not guaranteed. A "target" bonus of 15% can become 5% in a bad year, or zero if the company, or your team, misses its numbers. And this is exactly what happened for several years at one of my jobs. I was also double-hit by bad years because I had equity and payouts were minimal or nil. If you are comparing offers, don't count a bonus as salary. Treat it like a nice-to-have that you shouldn't build your budget around. 

Questions to ask:

• What has the bonus actually paid out in each of the last three years, not what the target is?
• Is it tied to my performance, the company's, or both?
• If there's equity, is it in a public company (liquid) or a private one (could be worth a lot, could be worth nothing)?

3. Pension

This is the big one on the public side, and it's the reason a lot of people make the jump in their late 30s and 40s.

Most government jobs come with a defined benefit (DB) pension, which is a guaranteed, inflation-indexed income for life, calculated from a formula. That's rare in the private sector now. The Fraser Institute found that 86.7% of government workers are covered by a registered pension plan versus 21.8% in the private sector, and of those, more than 9 in 10 public plans are defined benefit. A 2026 C.D. Howe memo estimated that only about 17% of core-age private-sector workers held a pension-covered job at all.

How the two plans you'd most likely end up in work:

• Federal (Public Service Pension Plan): Roughly 2% × your years of service × the average of your best five consecutive years of salary, up to 35 years. It's integrated with CPP, so the amount steps down a bit at 65 when CPP kicks in. If you joined on or after January 1, 2013 (Group 2), you get an unreduced pension at 65, or at 60 with 30 years of service. Pre-2013 members (Group 1) get it at 60, or 55 with 30 years.
• Ontario (Public Service Pension Plan, run by OPB): Also a 2% formula integrated with CPP. It has a Factor 90 rule - if your age plus years of service add up to 90, you can retire early without a reduction.

The pension is not free. You contribute a big chunk. As a federal Group 2 member earning $90,000 in 2026, you'd put about $7,600 a year into the plan, or about 8.4% of your salary. For current service, the cost is shared roughly equally with the employer. A useful way to think about it - it is similar to a generous employer match, except the government takes on the investment risk and the longevity risk, and the payments are indexed to inflation.

Ontario’s plan costs a bit more. Most Ontario Public Service engineers belong to the Public Service Pension Plan, run by OPB. After a three-step increase between July 2025 and April 2026, members now contribute 8.7% of salary up to the YMPE ($74,600 in 2026) and 12.0% on anything above it. On a $90,000 salary, that works out to about $8,340 a year, or roughly 9.3% of your pay. That’s about $740 more than a federal Group 2 member at the same salary. The upside is that your employer is required to match every dollar you put in, so the true value going into your pension is roughly double what you see come off your paycheque.

Neither one is completely free and this catches some people off-guard. Be ready for your net pay to be lower than expected because of the pension contributions and union dues (more on that later).

What happens when you die (and when your spouse dies). A DB pension is designed to pay out for life, but only for your life and your spouse’s. In the federal plan, if you die, your eligible spouse automatically gets a lifetime survivor pension of about half of yours (1% × years of service × your best-five average salary), and it’s indexed to inflation. Your own pension isn’t reduced to pay for this. Ontario’s plan works similarly: the default is a 50% survivor pension with no reduction to your pension, or you can choose a 60–75% survivor pension in exchange for a permanently smaller pension of your own. Once your surviving spouse dies, though, the payments stop. Federally, there’s a minimum guarantee: if less than five times your annual unreduced pension has been paid out in total, the difference goes to your designated beneficiaries. If you both lived a normal retirement, there’s usually nothing left to pass on. An RRSP (or RRIF) works the opposite way. If you name your spouse as beneficiary, the full balance can roll over to them tax-deferred. When they die, whatever is left is added to their income on their final tax return. That can push a big chunk into the top tax bracket, but everything left after tax goes to your kids or your estate. In short, a pension protects you from outliving your money, but it dies with you and your spouse. An RRSP leaves you to manage that longevity risk yourself, but whatever you don’t spend becomes an inheritance. This is one big gotcha for me if you are a good saver. If you are an excellent saver, you could partially compensate for that by using whatever RRSP room you have left to build a small nest egg you can pass onto your kids. 

Pension gotchas:

• It's back-loaded. A DB pension is worth the most to people who stay a long time and finish their career at a high salary. If you leave after 8 years, your deferred pension is based on what you earned then, not where your career would have gone. This is the "golden handcuffs" effect, and it's real.
• You need to vest. Federally, you need at least two years of pensionable service to be entitled to a pension. Leave before that, and you'll generally just get your contributions back.
• Early retirement is penalized. If you leave before you qualify for an unreduced pension, the federal plan reduces your annual allowance by 5% for each year you're short. That matters a lot if you're pursuing FIRE.
• It eats your RRSP room. A DB pension creates a pension adjustment (box 52 on your T4) that reduces your RRSP contribution room, often by most of it. If you've been maxing your RRSP in a private job, expect that to change.
• The boomerang trap. This one is very relevant to people like me who bounce back and forth. If you were in the federal plan before 2013 and you transfer your pension out when you leave (for example, take the commuted value or move it to another plan), and then get rehired, you come back as Group 2. That means your unreduced retirement age moves from 60 to 65. Leaving your pension where it is when you leave may preserve your options.
• Buybacks and transfers exist, but they cost money. Both Ontario plans and the federal plan allow you to buy back certain past service or transfer service in from other plans, but it can be expensive. Price it out before you assume you can "fix" a gap later.
• It doesn’t pass on to your kids. When you die, your spouse gets a survivor pension, usually about half of yours. When your spouse dies, the payments stop. Federally, if less than five years’ worth of your pension has been paid out in total, your beneficiaries get the difference, but after a normal retirement there’s usually nothing left. An RRSP is different: it can roll over to your spouse tax-deferred, and whatever is left after their death (and after tax) goes to your heirs.

Questions to ask:

• How many years do I realistically expect to stay?
• What would my pension look like if I left after 5 years? After 10? After 25?
• How does this fit with my FIRE timeline, if I have one? Would I be retiring before the unreduced age?
• Do I already have pension credits somewhere that I could transfer in or that could be affected?

I ended up transferring most of my pension to my RRSP account because I am aiming for an early retirement. The rest I was forced to pull out in cash which I also threw into my RRSP.

4. Benefits

Government benefits are consistently strong and very predictable. Under the Ontario engineers' collective agreement, for example, the employer has paid 100% of medical premiums, long-term disability covers two-thirds of salary, and short-term disability pays full salary for the first six days of an illness and 75% after that. Note that some friends who recently joined OPS are complaining about lower than expected coverages.

Federally, one benefit people underestimate is that you can keep your health and dental coverage into retirement, which is very valuable once you no longer have an employer plan. That generally requires at least six years of pensionable service and retiring with an immediate pension.

In private, benefits range from excellent to barely there. Large engineering firms and tech companies can be just as good as government. Small firms can be thin.

Sick leave is another quiet difference. The Fraser Institute found government workers lost about 15.7 days for personal reasons in 2024, versus 9.3 days in the private sector. Part of that is generous sick-leave banks in collective agreements.

Questions to ask:

• What's covered for dental, paramedical (physio, massage, psych), drugs, and vision, and what are the caps?
• What does disability coverage look like, short and long term?
• Is there any coverage in retirement?

Currently, my premiums are fully employer-paid and the benefit plan is quite generous. My current personal sick leave is limited to 5 days with full benefits and without cause. But if I provide a valid medical reason for being absent, I get full salary for up to 15 days, after which it drops off for the first 180 days and then some more for another 180 days, and then it is down to 0.

5. Vacation and time off

This one surprises people. I have more vacation in private than I ever had in government. In fact, at my previous private sector job, I had 6 weeks paid! And I was in my late 30s! That's because in private, vacation is negotiable when you're hired, and an experienced engineer can often walk in with four or five weeks. The sixth week accrued at a rate of 1 extra day per year of service.

In government, vacation is set by the collective agreement and grows with years of public service. Under most federal agreements, you start at 15 days (three weeks) and move to 20 days after eight years. Ontario's engineers' agreement has historically started people at 1¾ days per month, which works out to about 21 days a year.

A couple of nuances:

• Your vacation tier usually doesn't reset if you come back. Federally, years of public service, whether continuous or not, generally count toward your vacation entitlement, though some agreements exclude periods where you were paid severance.
• Government often wins on total time off once you add in generous sick leave, family-related leave, and compressed work weeks (more on that below). Not to mention, you can bank vacation while in the private sector you can usually only carry a year’s worth of vacation forward.
• You can't negotiate your private-sector vacation into government. Your 10 years at a firm don't count toward your public vacation tier.

Questions to ask:

• How much vacation am I giving up in year one?
• How many years until the public tier catches up to what I have now?
• What other leave (sick, family, personal) is available on both sides?

6. Flexibility and hours

For me, private has meant more flexibility. I'm not tied to my desk during set hours, and as long as the work gets done, nobody is watching the clock. Many companies are results-driven rather than time-driven.

Government flexibility looks different. It's more formal and rules-based:

• Core hours you're expected to be available.
• Flexible start and end times within a window.
• Compressed work weeks, where you work slightly longer days and get a day off every two weeks. This is one of the underrated perks of government work, and many people would give up a lot of salary for it. I had that during one of my stints and was amazing!
• Overtime that's actually paid, either as cash or time in lieu. In many private engineering roles, overtime is simply expected and unpaid. Or if it is paid, only junior engineers get paid.

So, private tends to give you informal flexibility (which depends heavily on your manager and your company culture), while public gives you formal flexibility (which is guaranteed but more rigid).

Questions to ask:

• Is my current flexibility a written policy, or just a good manager I could lose?
• Would I trade "come and go as I please" for "every second Friday off"?
• How much unpaid overtime am I working today?

7. Working from home

Right now, this is the clearest difference.

• Ontario government - five days in office.
• Federal government - at least four days in office, five for executives.
• Private - it depends entirely on the employer. Plenty of companies have also pushed back toward the office, but many still offer hybrid or fully remote roles, especially for experienced engineers.

I can work from home as much as I want in my current role. That's worth real money to me -  commuting costs, time, flexibility around family, and the ability to live farther from the city.

The bigger lesson is that in government, work-from-home policy is set by politicians and can change with little notice. Unions have filed complaints and fought these mandates, but so far the mandates have held. Don't make a decision based on a remote arrangement that a Treasury Board memo could reverse.

Questions to ask:

• How many days a week would I need to be in the office, and where?
• What does the commute cost me in money and time per year?
• How would I feel if the policy changed again in two years?

8. Job stability

The classic pitch for government is that you'll never get laid off. On average, there's truth to that: the Fraser Institute found that in 2024, 0.6% of public sector workers lost their jobs, compared with 3.2% in the private sector.

But:

• Government jobs depend on budgets and politics. The current federal cuts are a good example. In January 2026, PIPSC alone reported thousands of its members receiving workforce adjustment notices in a single week. A notice doesn't automatically mean a layoff, but it's not a fun place to be.
• In government, your performance doesn't protect you much. If a program is cut, the whole team is affected, regardless of how good you are. One comment I found summed it up well - in private, your productivity helps secure your job; in government, if the budget needs trimming, you might be the one trimmed regardless. Unfortunately, I was a victim of a trim during the great recession.
• In private, a strong engineer can usually find another job. Your real job security is your skill set and your network, not your employer. A common piece of advice I saw from people in tech - job security matters less in your 20s and 30s when you can line up another job quickly, so you can always go into government later for stability.

Questions to ask:

• Is the department or program I'd be joining growing, stable, or a target for cuts?
• If I got laid off from my current job, how long would it realistically take me to find another?
• Do I have an emergency fund that makes job stability less critical?

9. Union

Most government engineers are unionized. Provincially, that's PEGO (Professional Engineers Government of Ontario). Federally, engineers are usually in the NR group represented by PIPSC. Most private-sector engineers are not unionized.

What a union gives you:

• Pay increases, vacation, and benefits that you don't have to negotiate yourself.
• A formal grievance process and protection from arbitrary decisions.
• Representation during layoffs (workforce adjustment) and policy changes.

What it costs you:

• Union dues come off every paycheque.
• You can't negotiate individually. A great performer and an average performer at the same step make the same money.
• Your pay depends on the bargaining cycle. Contracts can expire and you can go a long time without a raise while negotiations drag on (PEGO went nearly two years). Job action like work-to-rule is possible, and you may be asked to take part.

Questions to ask:

• Am I comfortable having my pay set collectively rather than individually?
• When does the current collective agreement expire, and what's the bargaining climate like?

10. Who owns your employer

This one doesn't come up often, but it shapes your day-to-day more than almost anything else.

In private, ownership matters a lot:

• Publicly traded companies answer to shareholders and quarterly results. Expect cost-cutting when the stock dips.
• Private equity-owned firms are often focused on growing margins and selling the company in a few years. That can mean pressure on utilization, headcount, and benefits but it also means higher salaries and bonuses for top performers.
• Employee-owned or partnership firms (common in engineering consulting) can be great if you have a path to ownership, and frustrating if you don't. You start making serious money when you get a piece of the puzzle and the company does well.
• Family-owned companies can be very stable and loyal, or very political.
• Startups offer equity and fast growth with the highest risk, and require a lot of your time.

In government, the owner is effectively the government of the day. Priorities change with elections, budgets, and ministers. Return-to-office mandates, hiring freezes, and program cuts can all come from above with no input from you or your manager.

Questions to ask:

• Who owns this company, and what do they want out of it in the next 3–5 years?
• If government - how politically exposed is this department or program?

11. Stress

From my experience, private sector stress is significantly higher. But it's worth being specific, because the type of stress is different, and people handle different types differently.

Private sector stress tends to be:

• Deadlines and deliverables
• Billable hours and utilization targets (especially in consulting)
• Revenue, clients, and winning work
• Performance reviews with real consequences
• On-call or after-hours work

Public sector stress tends to be:

• Slow decision-making and layers of approval
• Frustration with process, procurement, and outdated tools
• Lack of control over priorities
• Political changes that can undo your work
• Uncertainty during cuts and reorganizations

Some people find private stress energizing and public stress soul-crushing. Others are the opposite. Several people I've talked to (and plenty of posts I've read) said that what pushed them out of government wasn't the work but the feeling that nothing moves. And others said they left private because they were burned out from constant overtime. 

Questions to ask:

• Which kind of stress drains me more - pressure or frustration?
• How is my health right now? Am I running on fumes?
• What does my family need from me in the next few years?

I have experienced both stresses and left employers. I can handle frustration a lot longer than pressure. It is OK to move around until you find a job that works best for you.

12. The work itself

This is engineer-specific, and it's easy to overlook.

• In government, you may design less and manage more. Many government engineering roles involve reviewing, approving, and overseeing work done by consultants and contractors rather than doing the hands-on design yourself. That can be interesting (you see a lot of projects at a high level) or frustrating if you love technical work. On the plus side, you get to interact with a lot of vendors and consultants, which expands your network.
• Scale and variety can be bigger in government. You may work on infrastructure and programs that no private firm would ever own.
• Tools and tech are often older in government. Procurement is slow, and you may not have access to the software or equipment you're used to.
• Licensing. Ask who pays your P.Eng dues and whether the role gives you the type of experience you need if you're still working toward your licence.
• Skill atrophy is real. A common observation in the posts I read was that it's generally harder to move from government back into private than the other way around. If you spend years managing contracts instead of doing technical work, you may find the private market less interested when you want to go back. This is something I was aware of and tried my best to be part of as many technical reviews as possible.

Questions to ask:

• Would I be doing engineering, or managing others who do engineering?
• Will this role keep my skills marketable if I want to leave in 5 years?

13. Career progression

• Private - Usually faster and flatter. Promotions can happen when you prove yourself, and a job change is often the fastest raise.
• Public - More structured. Moving up usually means applying to a competition or getting into a pre-qualified pool, and the process can take months. "Acting" assignments in higher roles are common and are often how people get ahead.

The private sector has much less tolerance for passengers, which cuts both ways. If you're strong, you get noticed and rewarded faster. If you coast, you get noticed too and deal with the consequences.

14. Side businesses and outside work

This is a gotcha a lot of people don't think about until after they're hired.

As a public servant, you'll be bound by a code of conduct and conflict-of-interest rules. Outside employment, consulting, or running a business usually needs to be disclosed, and anything that overlaps with your government role (for example, consulting in the same field) may not be allowed.

If you run a side business, do freelance engineering, or have a corporation, find out what the rules are before you accept.

Same goes for the private sector. Ask potential employers what their stance on side businesses are. Some employers add a blurb on this to their contracts so read the terms and conditions of your employment before signing.

15. The hiring process

Government hiring is usually slow. Expect applications, exams, interviews, reference checks, and often a security clearance, which can take months on their own. You may get placed in a pool and not hear anything for a long time. I got lucky once and was hired within a week of applying to the job but that sort of timeline is rare.

That's not a reason to avoid it, but it does mean you shouldn't quit your current job until you have a signed offer and a confirmed start date.

Gotchas I wish someone had told me

1. Leaving early can cost you more than you think. DB pensions reward long service. Leave after a few years and much of the value disappears.
2. Your RRSP room shrinks. The pension adjustment will eat most of it.
3. Transferring your pension out can change your plan terms if you come back. Especially federally (Group 1 vs. Group 2).
4. Your vacation doesn't come with you. Private sector experience doesn't count toward your public vacation tier.
5. Work-from-home can disappear overnight. It's a policy, not a right.
6. Stability is not guaranteed. Cuts happen, and your performance won't protect you much.
7. Your salary may be public. Hello, Sunshine List.
8. You can't negotiate your way up. Steps and bands are fixed.
9. Bonuses aren't salary. Compare base to base.
10. Check the outside work rules. Especially if you have a side business.
11. It's harder to go back to private than to leave it. Keep your skills sharp.
12. Hiring takes forever. Don't resign early.

Run the numbers - a hypothetical example

Let's say you're a 38-year-old engineer comparing two offers. These numbers are illustrative, not real salary data.

On paper, the private job looks like roughly $40,000+ more in annual compensation if the bonus pays out. But the public job gives you an indexed pension for life that you don't have to manage, and that's worth a lot, especially if you'll be there for 20+ years.

The real question is - what would you do with the difference? If you'd invest that extra $25,000 - $40,000 a year consistently, you can build your own "pension" and keep your flexibility. If you know you'd spend it, the forced saving of a DB pension may serve you better.

Then add the costs that don't show up in a table - commuting four or five days a week, the time lost, and the stress you'd be trading in or out.

So which one is right?

There's no universal answer, and anyone who tells you there is probably only worked on one side.

Public tends to make sense when:

• You value predictability and a guaranteed retirement income over a higher ceiling.
• You plan to stay long enough to make the pension worth it.
• You want formal limits on your hours and real paid overtime.
• You're in a stage of life where less stress is worth more than more money.

Private tends to make sense when:

• You're a strong performer and want to be paid for it.
• You value flexibility and remote work.
• You're comfortable investing on your own instead of relying on a pension.
• You're pursuing early retirement and don't want to be tied to a pension's timeline.

And remember, it's not a one-time decision. I have switched more than once, and every time it was the right call for that season of my life. The important thing is to go in with your eyes open, run the numbers, and know exactly what you're giving up on the way out.