THE
GROWTH OF STATE WORKERS
BUDGET: Rowland, unions battle for support
HARTFORD - From 1992 to 2001, the number of state employees jumped 22 percent,
from 54,184 to 66,200, according to U.S. Census data.
Payroll costs also mushroomed, matching the rate of some high-growth states, at
a time when Connecticut's economy was shifting from higher-paying industrial
jobs to lower-paying service ones.
Like many other states, Connecticut rode the late-1990s boom as high-flying
stocks padded many residents' portfolios. Racking up surpluses year after year
- the largest was $663 million in fiscal 1998 - Gov. John G. Rowland and the
legislature agreed to cut taxes and expand service programs.
Meanwhile, the administration negotiated union contracts - as well as a 20-year
pension and health care plan - State Budget Director Marc Ryan now considers
too costly with a sour economy.
Connecticut is not alone.
During the 1990s, most U.S. states addressed the service needs of the 1980s and
early part of the 1990s, when budgets were constrained, said Robert Reischauer,
president and an economist at the Urban Institute, a Washington, D.C. think
tank that analyzes social and economic policies.
'Unsustainable positions'
"They reduced taxes and expanded services very significantly and got
themselves into unsustainable positions," he said.
Add to the late-1990s spending and tax cuts a confluence of other
circumstances, which also fueled employee growth. The state's prison-building
spree; more part-time faculty in higher education; the state Judicial branch
absorbing 870 county sheriff workers; and federal consent decrees requiring
employee counts in certain agencies - all contributed to a larger state work
force, documents and interviews show.
As the state grapples with a two-year budget shortfall valued between $2
billion and $2.5 billion, state workers - particularly the approximately 45,000
in unions - are front and center, alternately viewed as scapegoats, victims of
layoffs or role players in an imbroglio they and many other actors have
contributed to.
About 2,800 state workers have received pink slips since early December, while
another 1,000 began to receive them last week. Meanwhile, negotiations on state
worker givebacks remain stalled, and progress appears unlikely.
On Monday, union leaders filed a lawsuit in U.S. District Court here suing
Rowland and Ryan personally, charging the two with violating union members'
constitutional rights by targeting only them for layoffs.
Additionally, the unions and the administration are working opposite ends of a
fight over a Democratic budget proposal.
The administration and state worker representatives disagree on matters big and
small - from how high workers' pay has risen since 1995 to the amount of extra
health care costs state workers should pay and whether public and private
sector wages are comparable.
Wages on the rise
In making their argument for union concessions, Rowland and his state budget
director have repeatedly said the average state worker's pay has risen 43
percent since 1995. By comparison, according to the U.S. Department of Labor,
the national average weekly earnings for production workers went up only 30
percent during that period. Also, the average benefits package for state
employees is 40 percent of their salaries compared with 27 percent for private
sector employees.
"The governor has been generous and we have hit a rocky patch and we need
a little help," Ryan said. "We're saying (to state employees) we gave
good increases during the good times, now we just need some give backs."
Dan Livingston, the unions' chief negotiator, dismisses the 43 percent number
as "extremely deceptive." To reach it, Livingston said the governor
and Ryan include pay-grade steps in the state worker compensation system. Leave
out the annual pay increments and workers' actual income hasn't risen that
much, he said. State clerical workers and engineers saw 17.5 percent and 21.5
percent increases, respectively, for example, he said.
"For Dan Livingston to say that annual increments are not pay increases is
just ridiculous," Ryan counters. "If your pay is guaranteed to go up
each year, that clearly is a pay raise."
A raise is a raise
On this issue, Reischauer agrees with Ryan, saying wage increases, as viewed by
economists, usually mean actual raises, promotional increases, cost-of-living
adjustments and pay steps. "It's the whole kit and caboodle."
The tables turn when the subject becomes how much state union workers might pay
if they agreed to a health care provision of Rowland's plan. Ryan accuses
Livingston of padding the cost to employees with obligations union employees
already shoulder according to negotiated contracts.
As part of his last offer, the governor has asked the roughly 45,000 state
workers in the 13 different unions to give back 1.5 percentage-point wage
increases this year, and defer general increases for 12 months in each of the
next two years.
They also would be deferred for nine months in the third year and for half a
year in the fourth, according to the plan. It also requires employees to
shoulder more health care costs, in the form of higher premiums.
On that last bit, Livingston said the governor has requested an extra 5 percent
of the whole premium, not just the employee's share. "A family paying
$3,338 would pay $5,863," he said.
But Ryan said the governor's latest offer asks for far less than 5 percent.
"We asked on average for $20 biweekly for a family" for the most used
health care plans, the state budget director said. "They're trying to
blame us for inflationary costs. The employee picks up inflationary costs under
the contract."
Underlying much of the debate is the issue of state workers' pay, and whether
it is comparable to their private-sector counterparts. Livingston argues state
worker pay-grade steps - which adjust salaries incrementally for years served,
among other things - keep public sector workers' earning power comparable to
their private-sector counterparts. The idea that public-sector employees earn
less than their counterparts is a myth based on long-dead historical precedent,
Ryan retorts.
Reischauer said the picture is more ambiguous than either side lets on.
"The answer to these conflicting set of statements, is it depends,"
he said. "For many types of manual labor, or less skilled labor, the state
pay scales can be above what they are in private sector, particularly when you
factor in benefits, vacations. But for the higher end, for the lawyers, the
teachers, the health workers, it's clear that they could receive higher
compensation in the private sector but have more job insecurity. By and large,
state workers get pension benefits that exceed those in the private sector. But
they purchase job security at the price of a lower wage than they could get if
they were in the private sector."
Currently, state employees have one of the most generous pension and health
care plans in the nation.
They are provided with group life insurance, a long-term disability insurance,
12 paid holidays and 15 paid sick days a year, besides regular vacations. Their
salaries and benefits account for one-third of the state's $13.2 billion
budget.
Low-growth state
Census data show during the 1990s Connecticut was one of a few low-growth
states with a 50 percent or more jump in payroll costs. Most of the leading
states had experienced rapid growth, such as Utah, Georgia, Florida and
California. It also virtually tied Colorado, a fast-growing state, in the
per-capita increase in full-time equivalent positions.
Connecticut's wealth may explain part of the expansion, Reischauer said.
As a state with a high per-capita income, the population has greater
expectations for better and more services than in other less-affluent states.
Also New England's high cost of living drives up pay scales beyond what they
are in, say, the Southeast or Midwest.
"You pay higher for a person with equal skills than for someone in say,
Nebraska," he said. "Also my guess is, Connecticut is a highly
educated, sophisticated state and wants services to be higher. And you have to
pay for that."
The gridlock on wage increases, health care costs and layoffs between the two
sides has become more pronounced. The animosity reached a fever pitch last
week, with the unions suing Rowland and Ryan as well as in the legislature's
tortured march toward a budget for this year. Unions pressured lawmakers to
support re-instating all laid-off state workers in the budget proposal while
Ryan and his staff tried to add a controversial provision that could shrink the
size of the state's unionized work force.
The provision could open vacancies to be filled by laid-off workers through a
proposed early retirement package.
According to one version's language, during a 15-month period, Ryan would be
required to fill at least 2,000 state job openings created by early retirees
and vacancies from regular attrition. But Ryan could treat new vacancies due to
attrition as non-union positions, thereby putting former union members into
non-union positions and shrinking union membership.
High-stakes politics
The high-stakes politics has fostered demagoguery on both sides. Unions label
Ryan and Rowland's goals part of a "right wing agenda" while
Republicans decry that unions are single-handedly torpedoing the Democratic
plan.
"If I were a Democrat, I'd think they were heavy handed," said House
Minority Leader Rep. Robert Ward, R-North Branford, adding he personally
overheard a union representative threatening a Democratic lawmaker if he voted
for any budget that didn't reinstate all laid off state workers. The punishment
to be meted out: a union-supported primary opponent to run against the
lawmaker.
House Speaker Rep. Moira Lyons, D-Stamford, and Majority Leader Rep. James
Amann, D-Milford, said they had heard no such thing, and counseled that people
should consider the source.
"Maybe Bob Ward is one of those lawmakers who walks into a room with
dynamite strapped on to blow up this deal," Amann said.
As political as the struggle looks, seeping below is the traditional management
vs. labor matchup, which often plays an integral role in these struggles,
Reischauer said.
"This has been a battle that has been going on since the 1950s," he
said. "The politicians and appointed officials responsible for managing
states and federal governments felt that the balance of power had swung too far
in the direction of rights for workers without commensurate responsibility or
performance. They have been arguing without much success, because, after all,
these are political decisions."
Republican politicians have mounted more frontal assaults, he said, while
Democrats, who depend on labor for political support, have been more subtle.
The growth of Connecticut's state government work force, meanwhile, comes at a
time of structural changes in Connecticut's economy.
The 22 percent jump in work force - from 54,184 to 66,200 from 1992 to 2001 -
came in full-time equivalent positions, an accounting category that combines
actual full-time positions plus part-timers' hours broken up into regular
workweek increments.
The state's actual full-time positions, however, grew by 5,000 from 1990 to
now, from roughly 52,000 to more than 57,000. During roughly the same period,
the state's manufacturing and finance, insurance and real estate sectors lost a
combined 97,000 jobs while the service sector gained 114,000.
Part of the growth of state employees is due to the state's building spree in
the 1990s, particularly of prisons.
During that time, the state built 10 correctional centers, later merging some
to produce seven new prisons, said DOC spokesperson Karen Oien.
Simultaneously, the inmate population has swollen to more than 19,000, from
just under 12,000, as the Department of Corrections' full-time equivalents rose
to 8,727, from 5,418, according to various government sources.
Meanwhile, the number of authorized correctional officers has dropped from
7,700 in 1995 to 6,875 now, while overtime has risen, said Dennis O'Neill,
political and legislative director of American Federation of State, County and
Municipal employees. He blames Connecticut's mandatory sentencing laws for the
prison-building spree, and said Rowland is asking employees to pick up the
cost.
Paying for expansion
"Now Mr. Tough on Crime doesn't want to pay for it," said O'Neill, of
Rowland. "He wants the state employees to eat it. We told him this would
cost him eight years ago."
Ryan admits there "has been growth in certain areas, either because of
mandating or truth in sentencing laws. But I don't understand what the unions
mean by paying for it. We are talking about (employees') absolute increases in
wages - the 5 percent (a year) in salary increases overall."
At the same time Connecticut was building more prisons, colleges such as UConn
were turning to more part-timers to teach classes.
The number of higher education's full-time equivalents skyrocketed from 1992 to
2001, to roughly 24,000 positions from 12,400, census data show.
Using part timers to teach more classes is a national trend, experts say.
As of 1998, 42.6 percent of all instructional faculty and staff at two-year and
four-year colleges institutions held part-time positions, said Ruth Flower, of
the American Association of University Professors, quoting the U.S. Department
of Education.
The state's judiciary branch also augmented the state employee force in 2000
when it absorbed the counties' defunct sheriff system and took on 870 new
employees. In one fell swoop, the judiciary inherited three-quarters of the
1,389 new full-time employees it added since 1990, said Robert D. Coffey,
personnel manager at the Office of the Chief Court Administrator.
Finally, there was a federal consent decree in the state Department of Children
and Families that mandated hiring social workers as caseloads increased, Ryan
said.
"There are some consent decrees in the (state Department of Mental
Retardation), the corrections department, but they are not of the magnitude of
DCF's," Ryan said.
News systems editor Howard Fielding contributed to this report.
Hefty package:
Salaries and benefits for the state's 57,000 full-time employees, more than
40,000 of whom are in 30 bargaining units covered by 13 different unions,
account for one-third of the state's $13.2 billion budget. The total state work
force numbers 66,200 if one includes full-time positions plus part-timers'
hours broken up into regular workweek increments.
State Labor Department figures show state workers earning a higher average
salary than the private work force.
Gov. Rowland is seeking about $450 million in lasting labor concessions. He
claims his plan is reasonable, calling for a 2 percentage point cut in expected
wage increases this year and a wage freeze next year. The offer also includes
higher co-payments for prescription drugs and higher health care costs. Co-payments
for state employees' prescription drugs range from $3 for generic drugs to $6
for name-brand drugs
State employees have one of the most generous pension and health care plans in
the nation. They are provided with group life insurance, a long-term disability
insurance, cancer insurance, regular vacations, 12 paid holidays and 15 paid
sick days a year.