On paper, the numbers look promising.
The unemployment rate has dropped to pre-recession levels. Gas prices are lower than they’ve been in more than a decade. For the second consecutive year, more cities are hiring rather than firing. According to the National League of Cities, 83% increased employee wages and 71% increased infrastructure spending in 2015.
Almost three-quarters (73%) of the 520 Public Works readers who completed our Salary & Benefits Survey in February got a raise in the last 12 months. The results reflect an upward trend that began when the Great Recession loosened its stranglehold on public budgets (see slideshow).
And yet, many say a raise in and of itself simply isn’t enough.
“Wages aren’t keeping pace with the cost of living, and benefits costs are continuing to rise faster than pay levels,” says an operator from a Colorado grounds/parks (urban forestry)/road maintenance
department who makes $40,000 annually.
It’s a familiar story that’s being told with increased frequency by our annual survey participants.
Many state and local governments are beginning to recover from an incredibly deep and prolonged recession, but their employees are still reeling from cost-cutting measures — pay cuts, salary freezes, and reconfigured benefits packages that increase paycheck deductions and out-of-pocket expenses — enacted to offset lost revenue and health insurance inflation.
For example, a New Jersey public works superintendent who earns $80,000 is concerned about increased employee contributions to health insurance: “The annual raise (2%) isn’t covering the increase in insurance.”
“There have been little to no pay increases for years, yet health care costs rise slightly annually while the coverage lessens,” adds a manager/supervisor in the Southeast making $58,000. It’s a top-of-mind concern for many in the public sector.
A 2015 Center for State & Local Government Excellence survey of human resource managers found that more than half (53%) changed health benefits within the last year, with the most common changes shifting costs from employer to employees through higher premiums, copays, and deductibles. And 29% made changes to pension plans, with the most common modification being increased employee contributions.
These adjustments surpass broad-based pay increases (reported by 36% of HR managers) and position-specific pay increases (reported by 21%).
Next page: More employees expect raises in 2016