Category Archives: Public Sector

Does Increasing Racial Minority Representation Contribute to Overall Organizational Performance? The Role of Organizational Mission and Diversity Climate

Source: Hongseok Lee, The American Review of Public Administration, Early View, March 10, 2019
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From the abstract:
One underexplored question in the representative bureaucracy literature is whether public employees advocate for their demographic groups at the expense of other groups or their organizational roles. Many studies have focused on the link between passive representation, or the extent to which the public workforce reflects the demographic characteristics of its clients, and active representation, or the extent to which policies advance the interests of those people. However, little research has been done on whether and when increased representation by a certain group enhances overall organizational performance. This study examines the relationship between racial minority representation in U.S. federal agencies and the agencies’ goal achievement while considering the moderating role of organizational mission and diversity climate. The panel data analysis shows that increased minority representation lowers agencies’ goal achievement. However, a positive relationship exists between the two in agencies that mainly work to promote social equity for disadvantaged populations and foster a positive diversity climate in the workplace. These findings suggest that racial minority employees can better contribute to organizational success in agencies where they balance advocacy and organizational roles well and they are treated fairly and respectfully.

Pension Brief: Are Asset Transfers A Gimmick Or A Sound Fiscal Strategy?

Source: S&P Global Ratings, February 19, 2019
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(Editor’s note: This publication marks the start of a series of short comments on credit matters of interest in the municipal retirement space. This first “Pension Brief” follows up on our publication one year ago surveying pension reform initiatives across the states (“Recent U.S. State Pension Reform: Balancing Long-Term Strategy And Budget Reality,” Feb. 9, 2018). ….)

…. To face persistent and growing pension challenges, some U.S. state and local governments have looked to develop creative solutions to help mitigate expanding liabilities and bolster wanting asset levels. ….

Illinois Budget Proposal Places Risky Bets On Asset Transfers and Graduated Income Tax

Source: S&P Global Ratings, February 22, 2019
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S&P Global Ratings believes that Illinois’ (BBB-/Stable) executive budget proposal precariously balances the current budget, but punts measures to address fiscal progress to future years. It prioritizes service solvency at the expense of lower pension contributions and does not make meaningful progress toward tackling the $7.9 billion bill backlog or projected out-year deficits….

Amid Strikes and Shortages, Governors Prioritize State Workers’ Plight

Source: Katherine Barrett and Richard Greene, Governing, February 25, 2019

Protesting teachers likely won’t be the only public employees who see pay raises and workplace improvements this year. ….

– In their State of the State addresses and executive orders this year, many governors are making public workforce issues a priority.
– They are particularly targeting teachers and corrections staff for pay raises.
– Several governors are focused on fighting sexual harassment and LGBT discrimination in state government…..

State and local government — US: Market volatility underscores risk of high pension investment return targets

Source: Thomas Aaron, Timothy Blake, Moody’s, Sector In-Depth, February 20, 2019
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Equity market losses in late 2018 will translate into larger than expected pension cost hikes in 2021 for many governments because of equity-heavy investment allocations within their pension systems’ assets. Despite the long-term investment focus of US public pension systems and favorable returns in the past two fiscal years, recent market losses highlight the uphill credit challenge facing governments that rely on high-return/high-risk pension assets to cover a large portion of their pension benefit promises.

How Government and Community Nonprofit Collaboration and Non-Collaboration Affects Public Sector Outcomes

Source: Rebecca H. Padot, International Journal of Public Administration, OnlineFirst, February 15, 2019
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From the abstract:
This four state foster care study seeks to understand what practices state public managers perform with regards to community nonprofits that contributes to effectiveness in producing better public sector outcomes. The study produced key player field research data on the conditions under which community nonprofits produce better public sector outcomes.

This article offers reasons as to why some effective community nonprofits were able to achieve collaboration with the public sector, while others were not, despite their effectiveness. Effective public managers in the area of foster care administration permit, and at times recruit, community nonprofits to have an impact on their foster care domain, while ineffective public managers never reach out to community nonprofits as partners or further yet, block nonprofits from access.

State and local government – US: Retiree benefits drive growth in fixed costs, posing greater challenges than debt

Source: Benjamin J VanMetre, Grayson Nichols, Thomas Aaron, Rachel Cortez, Alexandra S. Parker, Moody’s, Sector In-Depth, February 5, 2019
(subscription required)

Fixed costs — the combination of debt service, pension contributions and retiree healthcare— continue to rise for many US state and local governments. While retiree benefits (pensions and healthcare) will continue to drive this trend, the growth level is heavily dependent on unpredictable factors such as pension investment performance and workforce demographics. Debt service costs, on the other hand, are largely stable and unlikely to increase materially,continuing the trend of the last decade. Still, total fixed costs create budgetary challenges for some governments, potentially affecting their ability to deliver core services, a dynamic also known as “crowd-out” risk…..

2018 NCPERS Public Retirement Systems Study

Source: National Conference on Public Employee Retirement Systems and Cobalt Community Research,January 30, 2019

From the press release:
Fueled by strong investment returns, public retirement systems continued to strengthen their funding levels and fine-tune their assumptions, according to an annual study by the National Conference on Public Employee Retirement Systems.

The 2018 NCPERS Public Retirement Systems Study underscores the success of efforts by pension trustees, managers, and administrators to make steady improvements that enhance the sustainability of pension funds, said Hank H. Kim, executive director and chief counsel of NCPERS. ….

…The 2018 study draws on responses from 167 state and local government pension funds with more than 18.7 million active and retired memberships, actuarial assets exceeding $2.5 trillion and market assets exceeding $2.6 trillion. The majority—62 percent—were local pension funds, while 38 percent were state-wide pension funds. NCPERS conducted the eighth annual study in September through December 2018 in partnership with Cobalt Community Research.

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The Gender Disparity in Climbing Local Government’s Ladder

Source: Katherine Barrett & Richard Greene, Governing, January 28, 2019

Women are less likely than men to aspire for and occupy top jobs. They’re also less optimistic about their chances of moving up at all.

…. Late last year, National Research Center, Inc., released data it had collected over the last five years from 20,000 local government workers in more than 40 jurisdictions. Its survey reveals some gender disparities: 39 percent of men rated their opportunities for promotion as excellent or good, compared to only 29 percent of women. And 49 percent of men rated their opportunities for career growth as excellent or good, compared to just 43 percent of women. ….