Category Archives: Public Sector

Public Corruption and Pension Underfunding in the American States

Source: Cheol Liu, John Mikesell, Tima T. Moldogaziev, American Review of Public Administration, OnlineFirst, Published February 16, 2021
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From the abstract:
Unfunded public pension obligations represent a great challenge for policy makers in the American states. We posit that a part of pension underfunding relates to the level of public corruption. Empirical findings in the article show that funding ratios in public pension funds are inversely related to the incidence levels of corruption in the state, with other fiscal, political, and institutional covariates held constant. We show that this can happen through higher pension benefits, lower actuarially required contributions (ARCs), lower percentage of actual ARC contributions, and poorer investment outcomes. Based on empirical estimates, we find that a reduction of corruption by one standard deviation around the mean would permit the states to save on pension benefits by 10.24% annually (or US$1,894.64 per recipient), increase required ARC by 4.40%, increase actual ARC contributions by 8.46%, and improve investment returns by 4.72%. Therefore, policies to reduce public-sector corruption, or to improve the insulation of pension funds in relatively more corrupt environments, can make a significant contribution toward tackling the public pension underfunding crisis in the American states.

Reward Preferences of the Youngest Generation: Attracting, Recruiting, and Retaining Generation Z into Public Sector Organizations

Source: Nana Amma A. Acheampong, Compensation & Benefits Review, Volume 53 Issue 2, April 2021
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From the abstract:
Generation Z is the youngest and newest entrants into the workforce. However, confusion about their characteristics, work values, and reward preferences hinders effort to attract, recruit, and retain this generational cohort into public sector organizations. Accordingly, this study investigates effective reward strategies for recruiting and retaining Generation Z into public sector organizations. I used an evidence-based research approach and an aggregative systematic review as the study methodology. The evidence curated from 32 studies reveals how the background and life experiences of Generation Z influence the importance they assign their work values, reward preferences, and how they prioritize rewards in terms of their employment decisions. Additionally, gender also influenced the importance Gen Z assigned to specific rewards. Overall, Gen Z’s strong attractiveness to specific extrinsic and intrinsic rewards makes public sector organizations a likely employer of choice and offers managers a viable strategy for attracting, recruiting, and retaining the youngest generational workforce.

Public Sector Compensation: An Application of Robust and Quantile Regression

Source: Salomon Alcocer Guajardo, Compensation & Benefits Review, Volume 53 Issue 2, April 2021
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From the abstract:
This study assesses whether the theoretical compensation framework used to explain differences in public sector pay among full-time federal and state employees may also explain differences in pay at a local government level. In doing so, this study uses ordinary least squares (OLS) regression to test the application of the theoretical framework to a specific local government. Robust and quantile regression models are used subsequently to validate the findings obtained by the OLS model. The findings reveal that the covariates used to explain differences in compensation among full-time federal and state employees have similar effects at a local governmental level. While the OLS statistical model explains 26% (R2 = .26) of the variance, the robust regression model explains 39% (R2 = .39) of the variance. The percentage of variation explained by the quantile statistical models ranges from 14% (pseudo-R2 = .14) to 50% (pseudo-R2 = .50).

State Employee Health Insurance: Assessing the Scale of State Purchasing Power

Source: John Kaelin, Jim DeWan, Rockefeller Institute of Government, December 2020

From the introduction: https://rockinst.org/issue-area/state-employee-health-insurance-assessing-the-scale-of-state-purchasing-power/
Across the nation, state governments are major purchasers of health insurance for their employees. According to the US Census Bureau, 100 percent of state governments offered health insurance benefits to their employees in 2018. The Census Bureau further reported that state governments provided health insurance benefits to 67.6 percent of their 5.4 million employees in 2018. This total of approximately 3.7 million employees does not include the number of dependents, retirees, or enrollees of local governments, and other public employers that also participate in states’ health insurance programs. In 2012, based on a report published by Pew Charitable Trusts and MacArthur Foundation, total spending exceeded $30 billion covering 2.7 million households.

Between employee benefits and Medicaid programs, states’ spending on health insurance represents a major budgetary item. In 2018, the federal Center for Medicare and Medicaid Services (CMS) reported that health insurance spending for all state and local governments totaled $433.6 billion and that spending has experienced an average annual increase of 3.9 percent over the past five years. In Fiscal Year 2019-20, the state of New York itself spent $22.1 billion on Medicaid and $4.3 billion on employee and retiree health insurance costs. To alleviate these escalating costs, some states have examined options to coordinate purchasing across state programs in an attempt to achieve economies of scale. Recently, California proposed policies to leverage their purchasing of prescription drugs by combining employee health insurance programs with other state programs such as Medicaid and Correctional Health.

The purpose of this policy brief is to examine the extent to which the states in their role of purchasers drive the evolution of the healthcare delivery system. This brief examines the availability of basic financial and cost data relating to state employee insurance programs. It assesses the scale of state health insurance purchasing using existing data and presents results from a preliminary survey of states. We also review the degree to which employee purchasing decisions are coordinated with other state health policy purchasing goals such as Medicaid and the Affordable Care Act (ACA) insurance marketplaces.

Public Work Provides Economic Security for Black Families and Communities

Source: Michael Madowitz, Anne Price, and Christian E. Weller, Center for American Progress, October 23, 2020

….
Public sector jobs provide economic security for Black households

Public jobs provide good wages, better benefits, and greater job security, all of which are critical components of economic security and help families build wealth. Moreover, the wealth gap in the public sector is much smaller. For example, in the private sector, white households have as much as $10 of wealth for each $1 Black households hold; in the public sector white households hold closer to $2 for every $1 of wealth for Black families.

Public employment can provide greater economic security for Black workers for several reasons:

  • Public sector hiring is more accountable to citizen influence than private sector hiring, providing stronger checks on employment discrimination.
  • Public sector jobs are more likely to provide a defined benefit pension, which guarantees lifetime benefits upon retirement.
  • Public sector jobs offer more stable employment, providing economic security otherwise available only to households with wealth.
  • Public sector jobs are more likely to be unionized. Unionized jobs are highly beneficial to workers, and Black workers in particular.

Walking the Walk: Does Perceptual Congruence Between Managers and Employees Promote Employee Job Satisfaction?

Source: Miyeon Song, Kenneth J. Meier, OnlineFirst, Published October 26, 2020
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From the abstract:
Public managers and employees should be on the same page for successful performance. Managers’ self-evaluations of their own management, however, often do not match employees’ evaluations. Despite the consistent findings of a discrepancy between managers’ and employees’ perceptions of management, little research has examined how this perceptual incongruence affects employee job satisfaction. The present study addresses this question using parallel surveys from both managers and employees in the context of public education. The findings suggest managers overestimate their management effectiveness in general. As the perceptual gap between managers and employees increases, employees are less likely to be satisfied with their organization and their profession. We also find that this relationship is nonlinear, and the negative effects of incongruence could be accelerated when employees have considerable consensus about management. This study highlights the role of perceptual congruence in creating a better work environment and promoting job satisfaction for public employees.

A Manager’s Guide to Free Speech and Social Media in the Public Workplace: An Analysis of the Lower Courts’ Recent Application of Pickering

Source: Adam M. Brewer, Public Personnel Management, OnlineFirst, Published September 4, 2020
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From the abstract:
Public organizations are experiencing a burgeoning of workplace challenges involving employee use of social media. Comments, images, or videos ranging from racist remarks, to calls to violence, simple criticism of one’s organization, to full on whistle blowing significantly challenge public organizations’ policies for addressing speech that creates discord in the workplace. With the blurring of lines between personal and professional lives, these challenges create uncertainty for public organizations regarding how to maintain the efficient operation of the workplace, deal with the social and political fallout of such instances, and manage organizational liability. This article performs content analysis on 33 federal lower court opinions involving speech/social media workplace issues. The study analyzes the manner in which the lower courts apply free speech precedent on contemporary workplace speech cases. The findings suggest that patterns emerge from the opinions providing key insights for public managers regarding how to better manage these complex issues.

The Role of Strategic Human Capital Management in the Performance of Federal Agencies

Source: Andrew Wesemann, Journal of Public Management & Social Policy, Vol. 26, No. 2, 2020
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From the abstract:
The current human capital crisis, compounded by tumultuous workforce conditions in the public sector, holds consequential implications for governmental performance. As a result, scholarship has emerged emphasizing the importance of strategic human capital management (SHCM), which is explicitly intended to curtail organizational instability and concurrently improve performance levels. There is, however, a paucity of empirical research testing whether SHCM does, in fact, influence performance in public sector organizations. In an effort to fill this gap in the literature, this study tests for such a relationship in an analysis of agencies throughout the U.S. federal government. Using data from a large sample of federal employees, within 45 agencies, hierarchical linear modeling results reveal that SHCM holds a significantly positive relationship with performance measures at the employee level, although agency level results are less conclusive. Nevertheless, findings provide foundational quantitative evidence that the performance related benefits of SHCM are generalizable to the public workforce and transcend sector boundaries.

Reward Preferences of the Youngest Generation: Attracting, Recruiting, and Retaining Generation Z into Public Sector Organizations

Source: Nana Amma A. Acheampong, Compensation & Benefits Review, OnlineFirst, September 18, 2020
(subscription required)

From the abstract:
Generation Z is the youngest and newest entrants into the workforce. However, confusion about their characteristics, work values, and reward preferences hinders effort to attract, recruit, and retain this generational cohort into public sector organizations. Accordingly, this study investigates effective reward strategies for recruiting and retaining Generation Z into public sector organizations. I used an evidence-based research approach and an aggregative systematic review as the study methodology. The evidence curated from 32 studies reveals how the background and life experiences of Generation Z influence the importance they assign their work values, reward preferences, and how they prioritize rewards in terms of their employment decisions. Additionally, gender also influenced the importance Gen Z assigned to specific rewards. Overall, Gen Z’s strong attractiveness to specific extrinsic and intrinsic rewards makes public sector organizations a likely employer of choice and offers managers a viable strategy for attracting, recruiting, and retaining the youngest generational workforce.