PANAMA CITY, Panama – The Panamanian government spent over $400 million per month on public sector salaries through the first eight months of 2025, with August reaching a yearly high of $450 million in wage payments alone. According to official data from the Comptroller General of the Republic, total salary expenditures from January to August 2025 reached $3.4 billion, showing a net increase of $21.1 million despite some monthly fluctuations.
The comprehensive payroll report covering 95 public institutions reveals a steadily growing public sector workforce that reached 264,774 employees by August 2025. This figure represents a 1.5% increase compared to August 2024, adding 3,944 additional workers to the government payroll despite ongoing national debates about public finance adjustments.
Public Sector Workforce Expansion Details
The August 2025 payroll analysis shows the government workforce consists of 242,474 permanent employees and 22,300 temporary workers. The distribution includes 170,353 positions within the Central Government and 94,421 in the decentralized sector. The data demonstrates a significant shift toward permanent employment, with permanent workers increasing by 6,824 (2.9%) while temporary positions decreased by 2,880 (-11.4%).
The report from the Comptroller General includes data from 95 entities. Of this total, 29 belong to the Central Government, 42 are decentralized institutions, 16 public companies, and 8 financial intermediaries.
The monthly comparison between July and August 2025 shows the state payroll added 769 new employees, with significant hiring occurring at the National Assembly, the Instituto Panameño de Habilitación Especial (IPHE), the Ministry of Education (MEDUCA), the Ministry of Health (MINSA), and the Caja de Seguro Social (CSS).
Social Security Agency Leads Workforce Growth
The Caja de Seguro Social (CSS) experienced the most substantial workforce expansion, adding 2,153 employees between August 2024 and August 2025. The social security institution now employs 35,026 workers who receive over $70 million in monthly salary payments.
This personnel increase at CSS directly impacted the institution’s salary expenditures, which grew by $7.5 million compared to August 2024. The expansion reflects the growing demands on Panama’s social security system amid broader public sector growth.
This increase in personnel at CSS was reflected in the gross salary paid, with an increase of $7.5 million compared to August 2024.
Central Government Hiring Patterns
The Central Government increased its workforce by 1,132 employees compared to August 2024, with several ministries showing significant expansion. The Ministry of Public Security led with 1,172 additional employees, followed by the Ministry of Public Works with 521 new hires.
Other institutions with substantial workforce growth included Corregimiento Representatives (+395), the National Assembly of Deputies (+437), and the Attorney General’s Office (+375). These increases occurred while Panama continues discussions about optimizing public finances and government efficiency.
The payroll report excludes several significant categories, including the Panama Canal Authority, patronage organizations, and municipalities (except for corregimiento representatives). The data also doesn’t account for overtime pay, thirteenth-month bonuses, representation expenses, pensions, or temporary investment project salaries.
The analysis of Panama’s public sector payroll from January to August 2025 shows a progressive increase in government workers, though with seasonal contraction at the beginning of each year due to the renewal of temporary contracts. The ongoing growth in both workforce numbers and salary expenditures presents continued challenges for Panama’s fiscal management as the government balances public service delivery with financial sustainability.