06:44 AM EDT, 09/05/2025 (MT Newswires) -- It's been reported that the upcoming Canadian federal budget will feature large outlays on investments -- such as infrastructure and defense -- but also "austerity" on current spending, said Bank of Montreal (BMO).

There is apparently much "trepidation" in Ottawa around public sector employment tallies, noted the bank.

However, BMO recalled where Canada is starting from -- the federal government's share of the overall payroll employment has risen to 2.0% from 1.7% a decade ago.

True, that latter figure was also an extreme, and the share has backed down already in the past six months from the high of 2.1%, pointed out the bank.

But federal payrolls are still notably above their 25-year average, and some restraint would hardly be akin to austerity, added BMO.