Moonlighting and Wage Differentials: A Case Study of the Public and Formal Private Sectors in Ghana

Purpose With widening wage gaps between Ghana’s public and private sectors, many workers engage in secondary employment (moonlighting) to supplement income and sustain living standards. This paper examines the incidence and drivers of moonlighting, focusing on how sectoral wage differentials shape such decisions. While prior studies have explored general motives for multiple jobholding, few have empirically linked these behaviours to wage disparities. The study investigates whether public–private wage gaps influence moonlighting and identifies the main determinants of sectoral wage outcomes. Design/methodology/approach: Drawing on nationally representative data from the Ghana Living Standards Survey (GLSS 7), the study applies Ordinary Least Squares (OLS) to estimate determinants of wages, Oaxaca–Blinder decomposition to quantify wage gaps, and probit models to assess the probability of moonlighting. Explanatory variables include personal (education, gender, marital status), household (size, rural/urban location), and labour market characteristics (experience, hours worked, job security). Findings: Results show that education, location, and experience significantly affect wages in both sectors, while men consistently earn more than women. Oaxaca–Blinder decomposition reveals that most wage differences stem from variations in worker characteristics, though unexplained disparities point to structural inefficiencies. Moonlighting is more prevalent in the public sector, driven by lower wages and cost-of-living pressures. Lower earnings, larger households, and rural residence significantly increase the likelihood of secondary employment. Originality/value: This study provides the first empirical evidence linking public–private wage disparities to moonlighting in Ghana, offering insights to guide wage policy, labour market reforms, and human resource strategies.