Politicians love to campaign about reducing the size of government and encouraging reductions in public employment.
But does West Virginia really have more of its residents working for state government than other states? Not according to an analysis of U.S. Census Bureau data performed by Mark Muchow, director of fiscal policy for West Virginia.
“In my analysis of different state and local tax structures and tax policy trends, I found an analysis of expenditure trends including public-sector payroll expenditures to be helpful,” Muchow said.
“The public sector is also a component of the overall economy. Economic forecasts and tax revenue projections are based upon several variables, including state and local government employment and payroll.
“The actual size of West Virginia’s state and local government in terms of its employment levels and payroll is either comparable to or slightly less than the size of government in other states with similar levels of population,” he continued.
“However, the size of the private-sector economy is significantly below average relative to population (in West Virginia). The result of such combination is a perception that government employment is too high.”
As of April 30, 2005, West Virginia had the following public employees:
• Slightly more than 15,000 full-time equivalent employees take $534.6 million of the state’s general revenue account.
• Another 18,000 full-time workers have a total payroll of more than $620 million from special revenue accounts.
• An additional 4,600-some public employees are paid a total of almost $150 million in federal funds.
Looking at the fiscal 2007 budget, roughly one quarter of the total $13.9 billion budget (includes state and federal funds) will go to pay salaries and benefits for state employees — $2.01 billion for state workers and $1.26 billion for public education employees.
It sounds like a lot of people and a lot of money in a poor state, right? But when West Virginia is measured against the rest of thecountry, the truth is revealed.
When Muchow compared West Virginia’s 2003 per-capita payroll and full-time equivalent employees per 1,000 residents with other states, the Mountain State came up short not just in employment but payroll as well.
West Virginia has the 11th-lowest public employment per 1,000 residents in the country with 51.74 state and local full-time equivalent workers for every 1,000 residents based on 2003 data.
States with the lowest public employment are Nevada at 42.75 and Pennsylvania at 46.18 state and local workers per 1,000 residents.
Comparing With Pennsylvania
Muchow compared West Virginia’s public employment with one of its neighbors, Pennsylvania, a state he said traditionally has one of the lowest number of per-capita state and local government employees.
“If West Virginia wishes to employ the least number of government employees per resident population, the Pennsylvania numbers may help guide us to the types of services to be reduced or eliminated here in the process,” Muchow said.
Some of the differences are in the following areas:
• Pennsylvania employs 4.23 fewer full-time equivalent employees per 1,000 residents in public schools than the national average and 2.54 fewer than West Virginia. Muchow said Pennsylvania has more private schools, and the state has no constitutional requirement involving adequate school finances or financial equity among public schools. West Virginia does.
• In terms of hospital employment, Pennsylvania employs 2.12 fewer full-time equivalent workers per 1,000 residents than the national average and 1.17 fewer than in West Virginia. Muchow said Pennsylvania operates fewer government-run health care institutions.
• West Virginia employs 1.66 more full-time equivalent highway workers per 1,000 residents than the national average and 1.6 more than Pennsylvania. But Muchow pointed out that because of differences in how their highway systems are structured, West Virginia must maintain 41,938 highway miles per 1,000 residents, while Pennsylvania maintains 20,216 highway miles per 1,000 residents.
The Division of Motor Vehicles also makes West Virginia’s highway employment numbers higher than average.
“In comparison with other states, West Virginia offers a broad range of motor vehicle and driver’s license services in a greater number of conveniently accessible regional offices,” Muchow said.
When asked whether those regional offices are one area that West Virginia could stand to trim some employment, Muchow recalled the public backlash following news last year that the Citizens’ Conservation Corps Courtesy Patrol was being cut back.
“If public reaction to a proposal to eliminate one shift of the Courtesy Patrol is any indication of public sentiment, then a decision to close local DMV offices would be very painful,” he said, echoing Capehart’s earlier statement about whether residents would accept reduced government services in exchange for budgetary savings.
Workers Paid the Least
Not only are West Virginia’s public employees not out of line in their numbers, they also are far from overpaid as a whole.
“West Virginia’s per-capita government payroll is now the lowest in the country, and average salaries are the fourth lowest,” Muchow said using newly released 2005 Census data. “If education employees are removed from the equation, the average salary for all other government employees is the lowest in the country.”
Since West Virginia is known for its low per-capita income overall, the low public salary performance is not surprising. But given that West Virginia also does not have a disproportionately large number of its residents working for the state, leaders have fewer options when the discussion turns to reducing the size of government.
“Creative management is important, especially since taxpayers are demanding ‘bigger’ government (i.e., more services) over time,” Muchow said. “For example, additional taxpayer demand for public safety in the form of prisons and police protection is the single biggest driver of government employment growth in recent years.”