Study shows county employee wages below peers

The ongoing labor shortage in rural Wisconsin is leading to increased competition for quality workers.

Taylor County government is not immune from this increase in competition and as reported by county human resources director Marie Koerner is struggling to recruit workers for positions based on the current wage rate scale. Earlier this year, Koerner had come to the county’s finance and personnel committees and asked for the county to conduct a wage study to determine if they were competitive with other public and private sector workplaces and to bring recommendations for what it would take to become competitive.

On December 21, Patrick Glynn of Carlson Dettmann Consulting presented to members of the finance and personnel committees the results of the comprehensive wage study showing that Taylor County lags well behind in its wage package.

According to the Glynn, the county would need to invest approximately $335,000 into its payroll grid in order to come back to being in the mid-point of the wage rates in the region. He said the county lags behind peer counties and private sector in the employment marketplace by about 11.3%. With job positions ranging from highway crew members to social workers Taylor County follows a pay matrix based on job classifications and longevity. The classifications are based on requirements and responsibilities of each position with positions with lower classifications having a lower base wage than those with higher classifications. Most manager level positions are in the higher classifications.

Historically, Taylor County has politically chosen to be at the 50th percentile in the region when it comes to wage packages, however as part of a longterm trend of having fewer new workers to fill available positions, demand has resulted in increased wages. Glynn noted that the private sector has reacted to this, while the public sector has not.

Glynn noted that counties have less flexibility in reacting to increasing wage demands due to levy limit restrictions. “The market doesn’t care about your ability to pay,” Glynn said.

“You have a mess you are dealing with,” he said, This is further aggravated by the demographics of Taylor County’s workforce with about 45% of county employees being beyond the midpoint in their careers and having retirement “on the horizon.” Glynn said that about one third of the county’s workforce is over age 55 and that in the next several years the county will need to fill these positions due to retirements.

“Replacement of the third of the workforce is a big task,” Glynn said, Committee member Scott Mildbrand questioned the impact of groups such as millennials who are known to be “job hoppers.” Glynn said this is a function of age more than any particular generational group. He said younger workers in general are more likely to change careers during their working lives. However he said job hopping is not totally the domain of younger workers. “Half of the American workforce is keeping a watchful eye about work and is at least contemplating leaving their current employment situation,” Glynn said, Within the county’s matrix, there is greater focus on adjusting wage scales on the lower end of the scale than on the top based on the competition of entry level positions. Adjusting the matrix can become a costly endeavor depending how equitably the county seeks to maintain current pay differentials between midpoints in each pay grade. “At some point you stop caring,” he said of the concern over maintaining existing pay grade differentials as they go up the pay scale.

Glynn emphasized that it is the county’s decision what, if anything, to do with the information presented. He noted that one option for the county is to do nothing and instead maintain the status quo. Koerner advised against this noting they were having increasing difficulty in attracting staff. Mildbrand suggested that in order to increase wages within the levy limits, the county will need to look at prioritizing and streamlining its services. “It may come that we have to pay less people, more money to remain competitive,” he said.

Another factor Glynn noted in his study was the county’s standard 35-hour work week compared to more common 40-hour workweek. This means an hourly worker for the county earning the same hourly wage as a peer in the private sector would make about 12.5% less money due to having fewer hours of work in a year.

Glynn cautioned committee members that more pay doesn’t necessarily make more bodies in the workplace, however he said it does make the county more attractive to applicants. Committee members discussed the practicalities of implementing any sort of wage scale adjustment, “It comes down to a notion of affordability,” Glynn said.

Koerner said the county had about $239,000 set aside for adjustments from budgeted wage increases and the sale of property that had been used to house a released sex offender who has since relocated out of the area.

Mildbrand said that was just a shortterm fix because increasing the wage scale would be adding to what would need to be budgeted every year. “We would have to come up with that next year and the years following,” he said.

County finance director Larry Brandl, said he would be comfortable allocating an additional $100,000 from the county sales tax revenues to go toward the wages, which would be enough to cover the $335,000 the wage adjustment the study showed would be needed to bring the county back to the midpoint. However, the amount the county had available does not factor in the increase to the sheriff’s deputies and sergeants in their union contracts.

Mildbrand also noted that it is not a long term fix, saying that the state needs to ease up on levy cap restrictions and allow counties to at least match the increases in the consumer price index. “If we were allowed to raise taxes we would be able to pay for this raise,” he said.

Committee member Lester Lewis, suggested the county may need to look to asking voters to approve a referendum to exceed the levy limit. He noted that such an increase spread over the entire county tax base would have relatively small impact. Another option, which is used in other counties, is to utilize debt service to exceed the limits since debt payments do not count toward the levy limit. However, any of those options do not address the immediate concerns of the county with any proposed wage scale changes.

“Where do we go from here?” Koerner asked.

“I can’t vote on this today, I need time to think about it,” said committee member Tim Hansen.

Koerner said something needed to be done sooner rather than later. “It is killing us right now,” she said of losing prospective candidates to other employers. She noted that with advertising and other costs, recruiting for positions can become costly.

In the end, committee members approved a motion from Ray Soper to have the consultants prepare options around the $335,000 amount for wage scale adjustments and bring it back for a meeting of the finance and personnel committees to take place later in January. The goal of that meeting would be to come up with a firm recommendation to present to the full county board for action.