Tuesday, August 17, 2010

Cost Reduction and City Employees

Obnoxious workplace cliches of the 1980's include "Work Smarter, Not Harder", "Do More With Less", "Right Sizing" (a euphemism meaning innocent people will lose their jobs) and a variety of others that those of us who started their careers in that benighted era still cringe whenever we hear them. They all meant one thing - employees were going to lose.

In real terms, wages have remained flat for over 90% of workers since 1990. This is not some far out socialist claim, the Wall Street Journal for one has reported extensively on this phenomenon. The only real growth has been in the cost of nonsalaried benefits such as health insurance, where the cost has risen but the benefits themselves have not.

As North Bay Village comes to grips too slowly with the budget crisis, a key proposal is to reduce wages across the board using a furlough system. A 10% (more or less) reduction in all wages is scheduled again next year, and while employees will get 26 days off, one day per biweekly pay period, they are expected to produce at the current levels. Additionally, it looks as though there will also be an increase in the amount that employees pay for their benefits, as much as 15% for health care.

These cuts are an important emergency measure to balance the budget. We should not forget that these represent real sacrifice on the part of the employees. It's easy to think that anyone in this economy should be happy just to have a job, and there's some truth to that, but that's cold comfort when the bills are due.

North Bay Village has to be very careful with how we approach the benefit and wage cuts and Bob Pushkin is showing prudence and sensitivity as he formulates the budget. It's clear that many citizens will pay more in taxes and services than we are accustomed and that our services will be reduced. This is a sacrifice but on the scales, it weighs far less than the sacrifices our own employees are making and we need to be mindful and grateful of those sacrifices.

Kevin Vericker
August 17, 2010

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