“State and local governments are struggling to hire and retain workers amid a tight labor market, even as private-sector employment is reaching pre-pandemic levels.
Despite an influx of federal cash they received in response to Covid-19 — much of which remains unspent — and their own booming revenues, governments are having a hard time competing for workers as salaries at private companies rise.
Economists and unions warn that if public-sector employers can’t reverse the trend, it will erode the quality of services like education and slow the overall economic recovery. “
“Altogether, the public sector has gained back 53 percent of the jobs lost since February 2020, a ZipRecruiter analysis of Bureau of Labor Statistics data found. The private sector has won back 93 percent.”
“Economists cite a historically tight labor market as one driver of the discrepancy. Employers in every industry are struggling to attract and retain talent, which has put upward pressure on pay and perks such as remote work that governmentsthus far have been unable to match.
There were a record 11.3 million job openings in January, the most recent month for which data is available — about 5 million more than there are employed workers. At the same time, average hourly earnings have surpassed $31 — a more than 5 percent increase from the previous year.
The year-over-year growth rate for hourly private-sector salaries and wages in each of the past four quarters has exceeded that for state and local governments by the largest margin on record, according to a Pew analysis of Labor Department data.
“Really across the board, many governments are often facing intense competition for workers,” Mike Maciag, who studies the government sector at The Pew Charitable Trusts, said. “Slower [public-sector] wage growth is playing a major role in hindering efforts by a lot of governments to fill openings and retain workers.”
Maciag points to a recent report from Arkansas’ Office of Personnel Management that found competing offers from Walmart, McDonald’s, Amazon and the like were impeding that state’s efforts to fill some positions. All paid significantly more than the state for entry-level jobs — despite the fact that the “complexity and responsibility” of the government roles “far exceeded” that of the private-sector ones, according to the report.”