Right-sizing needed to remedy bloated labor costs
Louisiana ranks 1st in the South and 8th in the nation for the number of state employees per 10,000 population. Our state also faces a $3 billion to $4 billion budget shortfall over the next several years.
Should our leaders continue to arbitrarily cut higher education and health care to address yet another budget crisis? Or should they choose the more thoughtful, strategic approach, by right-sizing Louisiana state government, beginning with the cost of labor?
As a member of the legislatively-created Louisiana Commission on Streamlining Government, I support the latter approach.
The subcommittee that I chair has voted to recommend to the Commission, the governor and the Legislature that we eliminate 5,000 state government positions each year for the next three years using best practices recommended by the committee for a SECURE Louisiana in its report published in 1995.
SECURE was a statewide organization committed to reforming Louisiana state government, made up of business owners, corporate CEOs, labor leaders, teachers, students, state and public officials and government watchdog groups. Many of its recommendations were adopted, but the suggestions for gaining control of Louisiana’s labor costs were not.
Now is our opportunity to do what should have been done in 1995.
Reducing the number of state government positions by 15,000 over three years will save the taxpayers of Louisiana between $600 million and $1 billion. No state employee will be fired or laid off – we would simply eliminate these positions by not filling vacancies.
Louisiana has a turnover rate in state government employment of between 15 and 22 percent, depending upon whose study you believe, so there will be plenty of vacancies to not fill.
Under our proposal, department heads would be directed to fully reexamine their department functions and appropriately reorganize to manage the reduction of positions.
For example, department heads would be told to limit layers of management to no more than six layers, and preferably four or five. One manager would supervise no less than 10 staff, and the amount of clerical staff would be limited to a reasonable level of 15 percent or less.
Regional units and small units with two to five employees would be consolidated into larger, more efficient units. Additionally, the largest percentage reduction in staffing would be at central and regional headquarters.
The subcommittee also recommended that 20 percent of the savings achieved from these position eliminations be used to increase the salaries of remaining employees who assume new and additional responsibilities as a result.
Finally, these position reductions would not be allowed to reduce the quality of the services or products provided by each department.
No department head in Louisiana state government earns less than $115,000 a year (more with benefits). If a department head does not believe he or she can achieve the staff reductions required without reducing quality, the department head will be asked to notify the governor as soon as possible so he can be replaced with a department head who can.
No law says that Louisiana state government must be a big, fat, dumb, one-size-fits-all, top-down institution. Right-sizing makes sense even in the best of times, but especially when our state is looking at $3 billion to $4 billion in lost revenue over the next several years.
Families do it. Small businesses do it. It’s time for Louisiana state government to do it.