Gov. Mike Parson proposes pay raises for state workers as agencies struggle to fill jobs

Missouri Gov. Mike Parson is proposing to pay all state employees at least $15 an hour and give every worker a 5.5% raise as the state government struggles to hire and retain workers in an extremely tight labor market.

Parson’s pay plan, announced Monday, comes after he previously approved a much smaller cost-of-living adjustment but vetoed raises for workers in the Department of Social Services’ beleaguered Children’s Division.

The proposal already has the backing of top Republicans in the House and Senate. The leading budget legislators in both chambers endorsed the plan, appearing to pave the way for its quick passage when the General Assembly convenes in January.

Parson said if the bill is passed quickly, the raises can go into effect by February. In a statement, he painted a dire picture of the ability of Missouri agencies to compete for jobs.

“With many positions across state government facing turnover rates anywhere from 10-100 percent and vacancy rates from 30-100 percent, it is past time for us to make these investments in our state workforce, which remains one of the lowest paid in the nation,” Parson said.

“Our direct care and front line staff often make less than entry-level retail positions,” he added. “These public servants have tough jobs and rarely receive the thanks they deserve, and communities all across the state rely on them every day.”

The pay plan would cost a total of $91 million, the governor’s office said, with $52 million of it being paid for with general revenue.

Missouri is currently sitting on a budget surplus of more than $2.5 billion. State coffers have swelled with unspent federal coronavirus relief dollars that Democrats have been calling on Parson and other Republicans to deploy.

“Despite regular pay increases, Missouri’s state employees continue to rank among the lowest paid in the country,” Sen. Dan Hegeman, a Cosby Republican who chairs the Appropriations Committee, said in a statement. “This pay plan proposal will raise the minimum base pay, reduce pay compression, and ensure Missouri is able to recruit and retain talented and dedicated public servants.”

Lawmakers this year included in the current state budget a 2% raise for state workers across all departments that will begin Jan. 1.

But Parson also this year vetoed $2 million in 3 percent raises that lawmakers approved for child welfare workers in the strained Children’s Division, as well as statewide merit-based pay bumps. He explained then he wanted to ensure “equity across departments and divisions” and said the state was analyzing “alternative” ways to use merit raises to retain employees.

Later, his administration revealed it had inked a contract with a consulting firm, Accenture, to study pay issues in the Department of Social Services, to some lawmakers’ chagrin.

Parson’s announcement Monday came days after one state agency filed suit to go over budget in an attempt to raise worker pay.

The commission that oversees the Missouri Department of Transportation filed a lawsuit last week asking for a Cole County judge’s approval to use state road funding to increase pay for highway workers as the agency grapples with severe staffing shortages.

The Missouri Highways and Transportation Commission is suing Acting Commissioner of Administration Kenneth Zellers, who is responsible for certifying payments made by state agencies. The commission wants a ruling that Zellers can certify spending from the State Road Fund to cover salary increases for MoDOT employees.

The bipartisan commission appointed by the governor contends the state constitution allows it to spend as it needs from state road funds on its mission to construct and maintain highways, including to pay personnel. But lawmakers since 2018 have restricted the department’s spending to amounts specified in the budget and not authorized MoDOT’s requested pay raises, according to the lawsuit.

“It will save us money, workers will get paid better and we’ll have fewer vacancies,” said Rep. Peter Merideth, a St. Louis Democrat who tried unsuccessfully to insert pay raises into MoDOT’s budget this year. “Every year the Republicans have said no … So MoDOT’s finally tired of the legislature being completely stupid about this and just punishing our workers.”

MoDOT and the Office of Administration both declined to comment, citing the pending litigation.

The department said in the lawsuit it is expecting to lose 800 workers this year, compared with 600 annually the past five years. Worker pay has increased 8% over the past decade, compared with 30% in the private market that MoDOT recruits from. The department this fall told the public it is several hundred workers short the number of snow plow operators needed to quickly clear roads statewide in the event of a large snowstorm.

MODOT is also asking for $60 million in the budget that begins in July 2022 to boost worker pay and retain staff. The department’s rate of worker turnover has increased from 10.8% in 2017 to 13.1% this year, according to the department’s budget request.

That in turn cost the department $34.5 million in the fiscal year that ended this July in lost productivity and recruitment and training efforts, the department says.