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Budget chief says lost benefits could be channeled to wages

Rick Snyder
WKAR-MSU
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Gov. Rick Snyder will unveil his budget plan to state lawmakers on Thursday.

By Rick Pluta, Michigan Public Radio Network

http://stream.publicbroadcasting.net/production/mp3/wkar/local-wkar-952125.mp3

LANSING, MI – Governor Rick Snyder will unveil his budget proposal for the coming fiscal year later this week. Few details have been revealed in advance, but public employee compensation is expected to be a target as part of a plan to deal with a one and a half billion dollar shortfall.

AUDIO:

Comparing public and private compensation can be tricky because some jobs are so unique.

"I'm just driving around kinda looking to see what's out there tonight. If I see a traffic violation, I might stop em," says Officer Adam Park.

Park is an eight-year veteran the East Lansing Police Department. He has a bachelor's degree in social work from Western Michigan University. He completed a 20-week police academy before joining the force. He is also a trained police dog handler. Park's partner is a German Shepherd named Max - a tracking and narcotics dog.

Rick Pluta asked Parks - what would be a comparable job to his in the private sector?

"It's hard to come up with something that would take my skill set and use," Park says. "I deal a lot with people, something maybe in the social work field. We end up at a lot of fights, a lot of disputes, I'm in the middle of them trying to negotiate. That sort of deal. That's the best I guess I can come up with. We do a fair amount of investigative work, so maybe something in claims, something in private investigations, something in social work fields."

What is a comparable private sector job to a parole officer, a child welfare caseworker, or a prison guard? It's hard to say. But it's become a question in the debate over public employee compensation.

Governor Snyder's Citizen's Guide to Michigan's Financial Health says public employees in Michigan on the average earn more than workers in the private sector. It also says public employee compensation grew in recent years as private sector compensation was hammered down by the recession.

The governor says that is critical information for taxpayers and policymakers.

"The most important thing is to get the facts, be honest about the facts, just get our act together and go," Snyder says.

But public employee unions and researchers say those are not all the facts. The Snyder report compares all public employees in the state to all private sector workers.

"You know, it's pretty silly to compare a prison psychologist to a teenager that works at a fast-food joint," says Ray Holman, who works for United Auto Workers Local 6000.

The union represents thousands of workers throughout state government. He says what's missing is: public employees are far more likely to have college degrees than workers in the private sector.

"When you factor in for education, we make less money than the private sector does, and we're the people that make sure the highways are safe, we're the people that test your water, and we're the people who monitor the felons who are released back into the community," Holman says.

A report by the union-backed Economic Policy Institute says, that's true. It says, on an hourly basis, public employees with bachelor's degrees make about 7 percent less than college-educated workers in Michigan's private sector. That includes wages and benefits.

The EPI study found that even though public employees' salaries tend to be lower than private sector positions, their benefits are more generous.

Public employees are also a lot more likely than private sector workers to have union protection, so they're less likely to be laid off or have cost-saving concessions forced on them. That makes their paychecks and benefits less vulnerable.

There's also another question - what can taxpayers afford, or at least, what will
they pay for? Employee compensation makes up about one-tenth of the entire state budget. For local governments, personnel costs can make up about half of their budgets.

"I think people realize that we need to right-size our budget, we need to live within our means," says John Nixon, Governor Snyder's budget director. He says part of the administration's plan might be to offer public workers better wages in exchange for concessions that save taxpayers' money on benefits.

"What we're saying is, we want to get a model that we can sustain going forward and a model that people care about as far as their wages and those other things," Nixon says.

Nixon will be joined by Governor Snyder on Thursday to present their budget proposal to state lawmakers. Nixon says they'll also go to work to sell public employees on their plans, but there is no choice but to find new ways to save money, and that includes payrolls.

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