Pay raises lag in public sector

An analysis of recent wage increases shows that the pay of many local government workers is rising slightly slower than the rate of workers in the private sector.

From 2002 to 2009, workers in the private sector in Spokane County experienced wage increases of 26.4 percent. Wages of workers in local government were up 24.7 percent.

Patrick Jones, executive director of Eastern Washington University’s Institute for Public Policy and Economic Analysis, said given recent rhetoric, the data surprised him.

“The conventional wisdom is that government workers’ economic lot is improving faster than the private sector,” he said.

Especially in the city of Spokane, wage increases have been held down in recent years as administrators have pushed union negotiators for concessions to deal with the economic downturn.

The numbers don’t take into account benefits – an area where government workers enjoy significant advantage over private sector workers – but they do indicate that even in the economic downtown, government wage increases haven’t been out of step with the private sector.

A separate analysis of pay increases from 2000 to 2010 among local government workers in Spokane County shows that in general, Spokane workers have been more successful than county and transit unions in bargaining for wages over the past 10 years. The largest city union, Local 270 of the American Federation of State, County and Municipal Employees, saw pay increase by about 45 percent. That compares with wage increases of closer to 30 percent among most nonpublic safety unions in the county and at Spokane Transit Authority. City library workers’ wages also rose closer to 30 percent.

Among the clear leaders in pay raises among local government employees are firefighters. Both in Spokane and Spokane Valley, firefighters saw wage increases of more than 50 percent from 2000 to 2010.

Mark Vietzke, president of Spokane’s Local 29 of the International Association of Fire Fighters, said firefighters saw bigger increases because the pay was lower compared with similar departments to start the decade.

“We’ve just had a couple years where we’re catching up with our comparables,” Vietzke said.

Under state law, if local governments can’t agree to terms with police and firefighter unions during contract negotiations, the dispute is sent to an arbitrator who will set pay raises based on wages and benefits of “comparable” agencies. Police and firefighters are not allowed to strike.

Spokane officials have made changing the state law a priority this year during their annual legislative lobbying efforts. The Association of Washington Cities is backing a bill that would force arbitrators to consider other factors in setting pay for police and firefighters – including a government’s ability to pay and the standard of living of a community’s population.

Former Mayor Dennis Hession said local governments have been hurt by not being able to consider “the ability to pay.”

“The only other way to do it is by raising taxes. In this climate, that’s not something people are very interested in,” Hession said. “What I always focused on was not so much a value judgment but how much we could afford to pay.”

Spokane Mayor Mary Verner said the desire of the city to change the law has little to do with recent negotiations. She noted that the city’s fire and police unions both agreed to concessions late last year to save jobs.

“The reason has to do as much with local control of our destiny as with anything else,” Verner said. “We’re just not wealthy enough as a city to be benchmarked to other communities.”

Hession said one possible reason that city salaries rose higher than county pay is that city leaders have focused more on holding down health care costs. At the bargaining table, that often means giving up on demands to keep wage increases low.

Spokane County CEO Marshall Farnell said county wages have lagged behind city of Spokane pay for as long as he remembers. He thinks the difference partly results from cities having utility taxes and business license fees.

“The cities’ diversity of revenue is a little bit broader,” he said. “They have the ability to pay – more so than the county.”

In the early part of the decade, the number of private sector jobs being created in Spokane County outpaced the number of government jobs being created. That situation began to reverse during the recession as private sector jobs declined while local governments continued creating jobs, according to state statistics.

James Gregory, a University of Washington history professor and director of the Harry Bridges Center for Labor Studies, said wages of government workers likely have been sustained in the downturn in part by union contracts. But political forces are changing and that likely will affect government wages.

“In the years ahead, that could really deteriorate dramatically,” he said. “That is likely to last for a long time even after the national economy and state economy begins to recover substantially.”

Gregory, an expert on the Great Depression, said much of the rhetoric against government employee unions has been “wildly misleading and opportunistic.” Unions tend to drive up the standards of living of even nonunion workers, he said. That’s especially true among public sector workers because their wages are readily known and private employers have to compete with them.

Susan Meyer, STA’s CEO, said the agency and transit unions have agreed to smaller increases in recent years because the economic downtown threatened service cuts.

“The public expects that,” she said.