State Agency Budget Fight Is Symptomatic of a Bigger Problem

Recently Gallup issued a report entitled “State of Local and State Government Workers’ Engagement in the United States.”  The report reflects the aggregated results of Gallup’s daily tracking surveys between 2009 and 2015 capturing worker responses to its proprietary “Q12” survey which focuses on “actionable workplace elements with proven links to performance outcomes.”  Based on employees’ responses to this survey, Gallup groups respondents into one of three categories:

  • Engaged: employees work with passion and feel a profound connection to their work. They drive innovation and move the organization forward
  • Not engaged:  employees are essentially “checked out” putting time but not energy or passion into their work
  • Actively disengaged: employees are not just unhappy at work, they are busy acting out their unhappiness by undermining what their engaged coworkers accomplish.

Minnesota’s results were more than a little troubling.   Only 28% of state and local government employees were classified as “engaged.”  55% were not engaged and nearly 1 in 5 (17%) were actively disengaged.  

A closer look at these results by Howard Risher in Governing revealed the states with the worst employee engagement scores tended to have one thing in common – reliance on very old and regimented civil service systems.  “There is a striking pattern among the states and it suggests that we need to take a new look at the system that govern public workers.”   He continued:

“Indeed, at each state of a government workers career, civil service systems impact their working lives.  The regulations typically govern not only the hiring process but also career progression, management of performance, pay increases and most work related problems … My own experience tells me civil service laws and regulations inhibit the response to operational problems and contribute to a culture that inhibits employee performance.”

It’s in this context that policymakers' current contentious dispute on funding state government operations deserves to be examined.  Both the House and Senate have passed significant cuts to base state agency operations -- reflective of what one might expect to see during the Greatest of Great Recessions rather than times with a $1.65 billion state surplus.  In the House base budget cuts to Minnesota Management and Budget, the Department of Administration, and the Department of Revenue are 22.7%, 8.8%, and 4.4% respectively, while the Senate used a slightly duller carving knife ( 7.5% 7.0% and 4.1% respectively).   Supporters of the cuts should have to explain why these changes wouldn’t result in massively more employee frustration and disengagement, with the result being large scale deterioration of state services and significantly more taxpayer risk and exposure thanks to a reduction in the level and quality of management, information, and oversight these critical "backroom" operations provide.

At the same time, defenders of current state government operations need to be asked if they are concerned at all about the Gallup findings regarding Minnesota's public employees, if the Governing commentary rings true, and if the answer is "yes" to either, what should be done about it.   They should explain why prolific and narrowly defined job classifications, prescriptive work rules, pay structures designed on what bureaucrats think a job is worth to government rather than what labor supply and demand realities say, and excessively backended and underfunded compensation doesn’t make the biggest chunk of state government operations spending as flexible, adaptive, and responsive to new realities and needs as poured concrete.  They should also explain why managing and treating the government labor force as a giant commodity -- in which tenure and inflation drives compensation changes instead of performance -- doesn’t impact workforce engagement and satisfaction. 

There is an important agenda to pursue here: maintaining the high quality services Minnesota provides by improving government productivity and efficiency as general fund resources become more scarce, creating a workforce that is innovative and engaged, and ensuring the best and brightest are more inclined to come to/remain in the public sector.  Trying to force change through what most objective observers would consider to be counterproductive budget cuts won't deliver those outcomes.    Neither is an unwillingness to acknowledge that labor management methods and compensation constructs rooted in industrial unionism models from a century ago is not conducive to the needs of 21st century government.  But as long as any whiff of pursuing meaningful civil service reforms immediately gets lambasted as an agenda against the public sector and disrespect and contempt for the public sector workforce, get used to more frustration from elected officials and lousy employee Q scores.