State workers would get their biggest pay raise in living memory under a plan proposed Wednesday by Missouri Gov. Mike Parson.
In a news release, Parson said he wants to boost all state workers by 8.7% and to offer a $2 an hour night shift differential to employees in four agencies responsible for people under the care of the state.
Parson is asking lawmakers to pass a supplemental appropriations bill by March 1 so that the raises are included in paychecks issued at the end of the month.
It is the second consecutive year that Parson has pushed for significant pay increases for state workers to combat inflation and competition from the private sector. Last year, lawmakers approved a 5.5% increase in pay and a $15 base wage for all state jobs.
The raise last year was on top of a 2% raise that began Jan. 1.
“There is no question that the recruitment and retention of state employees have been a severe problem for our state, and we must do better,” Parson said in a news release.
The announcement came a day after Parson outlined some of his budget priorities in a meeting with GOP legislative leaders. Senate Majority Leader Cindy O’Laughlin, R-Shelbina, said there was general agreement that a pay increase is needed.
“Everyone agrees that there is a shortage of workers in the state and state government is no different,” O’Laughlin said in an interview with The Independent.
The Democratic leader of the Missouri House, Rep. Crystal Quade of Springfield, said in a statement that Parson’s pay raise plan should go further.
“As a starting point, the governor’s proposed pay raise for state employees has merit,” Quade said in a news release. “But it isn’t nearly enough to end Missouri’s sorry status of having the worst average state worker pay in the nation.”
Missouri employs about 50,000 people in all departments of state government.
There are 7,000 open positions, Parson noted in his news release, calling his proposal “the minimum we must do to support our state workers and the people of Missouri.”
The $2 night shift differential would be paid to employees who take evening and overnight shifts in prisons, mental hospitals, veterans nursing homes and other state-operated care facilities. Employees in the Corrections, Social Services and Mental Health departments, along with care employees of the Missouri Veterans Commission, would be eligible for the differential.
“We want to be clear, this is not state government attempting to set the market,” Parson said. “This is merely an attempt by state government to stay competitive with the market.”
The release quoted the directors of all four departments saying it will be easier to fill open positions and provide overnight care under Parson’s pay proposal.
“The $2 an hour shift differential for the congregate care workforce at 24/7 state-operated programs is very important,” Mental Health Director Valerie Huhn said. “It acknowledges that increased pay is needed for the State of Missouri’s front line team members who work during hours when other staff are home with their families.”
While inflation is slowing, prices in November were 7.1% higher than a year earlier, the Bureau of Labor Statistics reported last month. The report on prices in December is due Thursday.
During 2022, average hourly earnings nationwide increased by 4.6%.
There’s money available for large raises because high inflation and higher wages being offered to attract workers generally continue to bring double-digit growth to state revenues despite a forecast in early December that tax receipts would slow in the second half of the fiscal year. As of Tuesday, revenues were up 14.2% for the fiscal year.
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The state is also sitting on its largest surplus in history. At the end of December, there was $5.2 billion in the general revenue fund and almost $1.6 billion in other funds that can be spent like general revenue.
Senate Appropriations Committee Chairman Lincoln Hough, R-Springfield, said both state employees and contract providers are being pinched by inflation and staff shortages.
“We’re dealing with workforce issues and job placement issues all over the state, not just in the state workforce, but in these longer term care facilities,” Hough said. “We’ve got to have competitive wages, not just at the state, but also in those providers that are taking care of our aging populations.”
Parson estimated the cost of his pay plan at $151.2 million through the end of the fiscal year on June 30, including $82.4 million in general revenue. Continuing the raises for a full budget year would cost more than $450 million, including about $245 million in general revenue.
Parson will deliver his full budget plan and package of legislative proposals next Wednesday.