Can LA Afford Its High Priced, Inefficient Workforce? Paid Much More Than Private Sector

“Working” for the city of Los Angeles maybe one of the cushiest jobs in California. It is also one of the easiest and best paid—not only by government standards but by private industry levels. Even the Los Angeles Times is taking on this boondoggle. While Mayor Garcetti is crying and begging for more money, the unions running the city are making out like bandits. This is a city that proves hard work is stupid, honesty is foolishness and that theft by union is a way of life.

“In their 1,300 word article, Peter Jamison and Catherine Saillant detailed how many city workers earn considerably more than their private sector counterparts, with premiums ranging from 40% to over 100%.

City workers are also entitled to very hefty benefits that far exceed those in the private sector, including a Cadillac healthcare plan, a generous defined benefit pension plan, ample vacation time, 13 paid holidays, and 12 sick days at full pay.”

Los Angeles is quickly losing its middle class—they can no longer afford the unions owning the city. They are being replaced by the poor and illegal aliens—drive along many of the city streets, LA has become the Calcutta of America. How? Look for the union label.

Photo courtesy of Eric Garcetti, Flickr.

Photo courtesy of Eric Garcetti, Flickr.

Can LA Afford Its High Priced, Inefficient Workforce?

Written by Jack Humphreville, City Watch LA, 5/1/15

LA WATCHDOG-“Public, Private Sector Wage Gap Heavily Favors Many LA Workers,” a front page article in Sunday’s Los Angeles Times, marks the beginning of the conversation involving the efficiency of the City’s operations and whether the City should “outsource” a portion of its operations, including the repair and maintenance of our deteriorating streets and broken sidewalks.

In their 1,300 word article, Peter Jamison and Catherine Saillant detailed how many city workers earn considerably more than their private sector counterparts, with premiums ranging from 40% to over 100%.

City workers are also entitled to very hefty benefits that far exceed those in the private sector, including a Cadillac healthcare plan, a generous defined benefit pension plan, ample vacation time, 13 paid holidays, and 12 sick days at full pay.

The City’s operations also appear to be poorly managed, hindered by the lack of management information systems as was detailed in Controller Ron Galperin’s audit of the Bureau of Street Services.  As a result, the Bureau does not have a very good grasp of its performance metrics and overall operation.

Galperin also revealed that the Bureau has very low direct labor utilization rates (57%) which results in the overstaffing of its work crews.

The City’s cost structure is also burdened by a bloated, paper pushing bureaucracy which results in excessive department overheads.  This is compounded by unsupported allocations for centralized services and City Hall administrative expenses that are needed, in part, to handle the disruptive interference from members of the City Council, their staffs, and their favor seeking cronies.

Our cash strapped City can no longer support these inefficient operations that are crowding out the City’s ability to provide basic core services such as the repair and maintenance of streets and sidewalks and the enforcement of traffic laws, planning and zoning rules, building and safety regulations, and local zoning ordinances, all of which impact our quality of life.

As a first step, the City needs to determine the efficiency of its departments by benchmarking their operations against other governmental entities and private enterprise. While this may be a novel experience for the City, it is standard operating procedure in the private sector.

The City should also implement a policy of “managed competition” where the City contracts with private contractors for a portion of the work and compares the results with those of City work crews.

The Department of Water and Power had such a policy to replace selected water mains.  This resulted in a DWP construction work crew incurring 100% cost overruns while at the same time blowing its deadlines.  The private contractors were, for the most part, on time and on budget.

The City should also consider implementing performance based evaluations of its employees while lessening the importance of seniority.  This would provide the City with considerably more operational flexibility to lower its costs and deliver a finished product on time and on budget.

Together, these three reforms, benchmarking, managed competition, and performance based personnel evaluations, would result in significant savings, freeing up to $200 million (less than 10% of the civilian personnel costs) that would be devoted to eliminating the Structural Deficit, repairing and maintaining our streets and sidewalks, and restoring vital city services that are essential to our quality of life.

Unfortunately, the Herb Wesson led City Council will reject these reforms because it does not have the courage to stand up to the campaign funding City unions.  Its solution is to continue to play games with the budget by raiding the Reserve Fund and deferring needed expenditures.  At the same time, they are concocting a plan to persuade the City’s skeptical voters to approve a massive increase in our taxes.

But this rope-a-dope strategy of prioritizing their own personal political goals at our expense is not going to fly as the voters will demand work place and budget reform.  Maybe it is time that City Hall took the advice of former New York Governor Mario Cuomo:

“It is not government’s obligation to provide services, but to see that they are provided.”

 

About Stephen Frank

Stephen Frank is the publisher and editor of California Political News and Views. He speaks all over California and appears as a guest on several radio shows each week. He has also served as a guest host on radio talk shows. He is a fulltime political consultant.

Comments

  1. Richard Rider says

    Contracting out is where the BIG savings are, and the IMMEDIATE relief. Grandfathering existing workers with their opulent pay and benefits leaves us with the existing problem for the next 20+ years.

    Let’s turn as many government functions as possible over to the private sector via competitive bidding, with companies held fully accountable for performance (something seldom done with government departments and workers). And BTW, the savings are FAR bigger than the immediate budget comparisons, as government systematically understates and under-accounts for unfunded pension AND retiree MEDICAL CARE liabilities.

    A side benefit (some might argue the BIGGEST benefit) is dramatically shrinking the public employee labor unions — the biggest single problem in California. If we can’t ban such public employee labor unions (a recent addition to California), gut them by putting their members back in the private sector.

  2. Richard Rider says

    It’s a common misconception across the political spectrum that the cost savings in government can be had by limiting the pay and pensions of only the top salaried folks — nobody likes those who make more than THEY do. While reforms there would be helpful, the disparity in pay at those levels (compared to the private sector, and factoring in job security) are considerably less than the HUGE pay disparity for blue collar workers. Because of the numbers, the blue collar (and pink collar, if you’re gender insensitive) work force is many times larger, and has far more room or percentage savings. This LA TIMES article needs wide dissemination.

  3. If you sum all the wages, benefits, bonuses and paid retirement plans municipal employees get in California then divide by their years of service you will find they are paid three times what they could make in the private sector with their training and experience. And, they have virtually infinite borrowing power at banks because they cannot be fired!

    Google “Two Minute Conservative” for clarity.

  4. askeptic says

    Socialism is a wonderful system of governance, until you run out of Other People’s Money!

  5. Makes you wonder how much longer the tax payers will put up with this robery. Thousands of city,county,state and federal workers. Wher you need three of them (minimum) to do the job of one. And on top of that the lazy a holes get the best friggin retirement anyone’s could dream of. In some ways I can’t wait until the collapse occurs, then days when these thieves get theirs, their checks don’t come or bounce because the “agency” they work for is busted, out of funds, no more tax payer money.
    The what brill the lazy SOBs do? They will cry, they will file law suits, they will wonder what happened, then they will protest, crying out for the friggin government to save them, their cush jobs gone, evaporated, their Public EmployeeUnion Reps in hiding in anouther country with suitcase full of money. Will the tax payers have sympathy, he’ll no . These people are thieves , screw them.*

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