Where Things Stand: The State and Local Workforce Going into 2013

As 2012 comes to a close, Center Vice President of Research Joshua Franzel has been speaking to various groups about the current structure of state and local government workforces, changes to this labor force, related trends, and challenges governments face as employers. Here are the highlights.

State and local workforce is aging

It is important to note some key attributes among the state and local sectors. An analysis of Current Population Survey data shows that the state and local workforce as a whole is aging:

  • In 1992, the median ages of the state and local workforces were 40 and 41 years of age, respectively. This was at a time when their wage/salary private sector peers had a median age of 35.
  • Today the state and local workforces have a median age of 44/45 in 2012, relative to 40 in the wage/salary private sector.
  • Of particular note, in 1992 about a quarter of all state and local workers were 50 or older. As of 2012, 37 percent now fit in this age group.

Educated and becoming more so

State and local government employees have been quite educated and have become even more so over the past 20 years. Current Population Survey data show that in 2012:

  • One in five state and local workers have achieved a high school education. About a third of the wage/salary private sector has this level of education.
  • Twenty-eight percent of state workers have a bachelor’s degree and 29 percent have a masters, professional, or doctorate degree.
  • A quarter of local government employees have a bachelor’s degree and roughly another quarter of these employees have higher levels of education.
  • Among wage/salary private sector workers, 20 percent have a bachelor’s degree and 9 percent of these workers have attained higher levels of education.

These higher levels of education in the state and local sector make sense given the type of work governments do: much of it is knowledge-based and requires advanced education or training, both before and during employment.

Freezes begin to thaw

The Center for State and Local Government Excellence, along with the National Association of State Personnel Executives and International Public Management Association for Human Resources, has been tracking, through a series of surveys, changes in personnel policies state and local governments have made since the end of the great recession.

In 2012, half of the respondents reported that their governments had imposed pay freezes over the past year, 42 percent had imposed hiring freezes, and 29 percent made layoffs (“State and Local Government Workforce: 2012 Trends”).

The silver lining, if you want to call it that, is that these numbers have been improving since the end of the recession and match with Bureau of Labor Statistics figures that show state and local layoff and discharges rates decreasing from their 2009 peak .

Center surveys point to an uptick in the number of retirement–eligible employees actually retiring. This is a trend worth watching given the age demographics of the workforce overall.

These surveys also ask about what positions governments continue to have a hard time filling, even in the current economic climate. The list has gotten longer over the past few years, populated by many knowledge-based positions that require advanced training — engineers, epidemiologists, IT professionals, physicians, nurses, skilled trades, and many others. This is in an environment of 7.7 percent overall unemployment, with unemployment rates less than half that for those with a bachelors degree or higher.

Given the approaches state and local governments have taken in response to the Great Recession —  regional and inter-local cooperation on service provision, public-private partnerships, etc. — and given relatively flat government revenues, it will be some time until their employment levels return to their 2008 peak. That said, governments have difficult choices to make as to how they will offer competitive compensation and benefit packages that will attract and retain personnel with key skill sets, while also ensuring that these packages are fiscally sustainable.