Media quotes show timeline of labor cost debacle

By Oregon House Republicnas

Governor Finally Acknowledges Impact of Labor Costs on State Budget…
“‘I’m just going to rip the Band-Aid off this one and say it: Increasing labor costs will be a big contributor to future deficits if we do not change the way we budget and provide compensation for public employees.’

“The costs to the state for the Public Employees Retirement System will increase by more than $350 million in the next two years and by almost $1 billion more by 2017, he noted. And health care costs are rising more than 10 percent a year.”
(Gov. Ted Kulongoski says recession forces Oregon state government to rethink how it operates, The Oregonian, Michelle Cole, 6/26/2010)

…Something Republicans Have Been Saying for Years.“‘You have to go where the money is, and the money really is in the cost for payroll,’ said Rep. Dennis Richardson, R-Central Point. Richardson said he’s been warning for years that the state was spending — and hiring – ‘at a pace that made no sense given its revenue stream.

“Lately, he said, the state has relied on one-time federal bailouts and a tax increase on businesses to stay afloat. Now, he said, others, including the governor are coming to the conclusion that that’s no way to budget. “‘You can’t keep kicking the can down the road,’ Richardson said.
(Recession makes pay, benefits for Oregon state workers latest target, The Oregonian, Harry Esteve, 6/19/2010)

Schools Looking to Cut School Days, Teachers, Programs…
“Skip textbook purchases. Dip into reserves. Keep vacant jobs open. Those are among the first ways that school districts try to trim budgets. But for most Oregon districts, those options have been exhausted.

“Now, many school leaders face a third consecutive year of reductions and are planning cuts that will hit the core of Oregon’s K-12 education system — school days, teachers and programs.”
(Oregon schools consider eliminating programs and restructuring to cover state funding shortfall, The Oregonian, Kimberly Melton, 6/28/2010)

…As House Dems Defend State Labor Benefits, Pension Costs.
“House Speaker Dave Hunt, D-Gladstone, said he’s looking forward to the reset panel’s recommendations. But he said it won’t make sense to cut pay or benefits for state workers if it’s clear that their compensation is on par with their private sector counterparts.

“Instead, he said, lawmakers and the next governor will have to make difficult choices of cutting back on services the state provides.”
(Recession makes pay, benefits for Oregon state workers latest target, The Oregonian, Harry Esteve, 6/19/2010)

Dems Claim Public-, Private-Sector Labor Costs Are Comparable…
“Oregon’s front-line workers have bargained a wage and benefit package comparable to other states and to the private sector. These workers have demonstrated a willingness to sacrifice by accepting wage freezes and unpaid furloughs. We will continue to ask them – through the collective bargaining process – to do their share, but we will not use them as convenient scapegoats.”
(News Release: Statement from House Majority Leader Mary Nolan on Governor’s City Club Speech, House Majority Office, 6/25/2010)

…But the Facts Say Otherwise.
“The money involved is not chump change. According to the Oregon Labor Market Information System, which keeps track of employment using definitions set by the federal government, there are roughly 77,000 state jobs in Oregon. In addition, the state pays a large chunk of the money spent on salaries and benefits in K-12 public education. State employees, at least, are paid better and receive more in benefits than their counterparts in private business.

“Thus, while the average base salary for one group of about 51,000 state employees is about $50,000, according to The Oregonian newspaper, benefits add another $22,000. In fact OLMIS statistics show that total benefits for state employees averaged $13.65 per hour in 2009, while those for private sector workers came in at just $8.02 per hour. The salary gap is every bit as large, meanwhile. Overall, wages and salaries, not including benefits, averaged $26.01 per hour for public employees last year, compared with $19.39 per hour in the private sector.”
(Look who’s talking about labor costs, Bend Bulletin, Editorial, 6/23/2010)