NC tries one-time pay hike to retain state workers

jfrank@newsobserver.com draynor@newsobserver.comJune 17, 2014 

  • Breaking down pay hikes

    The salary increases for the nearly 3,500 state workers covered a wide range, varying based on adjustments for private sector pay, equity issues and job changes.

    Size of pay hike Percent of total
    10 percent or more 2 percent
    8 to 10 percent 4 percent
    6 to 8 percent 7 percent
    4 to 6 percent 67 percent
    2 to 4 percent 12 percent
    Less than 2 percent 7 percent

    *Total percents may not equal 100 because of rounding.

    Source: Office of State Human Resources

To retain workers in high-demand state government fields, a little-noticed fund provided pay raises this year to nearly 3,500 employees that totaled more than $7.5 million.

Gov. Pat McCrory’s office announced the salary raises in January but the administration didn’t release a full list of employees who received the extra money until this month.

The increases came amid a pay freeze for the vast majority of the 85,000 state workers, who received just one raise in the past five years at 1.2 percent. A roughly $1,000 pay hike is part of current negotiations as state lawmakers look to finalize the budget for the next fiscal year.

A News & Observer analysis of the new data shows the pay hikes averaged 4 percent, or $2,500.

The pay hikes were capped at 10 percent but two dozen employees got a bigger boost because they also received a promotion.

The two largest pay hikes this year went to managers in the Western Data Center in Forest City, where the state is feeling particular market pressure from nearby tech giants Google and Facebook, who offer top dollar to skilled workers. One manager received a $15,000 raise, boosting his annual salary to $90,000 and another received a $10,000 raise, moving his salary to $62,600, the state data shows.

Stephanie Hawco, an agency spokeswoman, said the state pays 80 percent of the salaries that the private sector offers.

“We have a big gap in what the state is able to pay and market professionals (salaries),” she said.

Gov. Pat McCrory has repeatedly cited the disparity in state government pay when he discusses the trouble the state has recruiting and retaining top professionals.

“I can’t keep nurses because the hospitals pay much more than state government,” McCrory told a business group earlier this month, recalling his experience as a former corporate recruiter at Duke Energy.

The payroll data does not provide a reason for each increase, but the governor’s office said 73 percent of the hikes made wages more competitive with the private sector, 24 percent rewarded promotions and job changes and 2 percent addressed job equity issues.

The analysis shows that more employees received raises than the initial 3,221 the administration disclosed in January.

Jonathan Bandy, a spokesman for the state human resources office, said the information released in January was preliminary.

State lawmakers set aside $7.5 million in the 2013 budget to address the most urgent cases and state agencies made requests to the state personnel office, which doled out the money. The agencies asked for $18.4 million – far more than they received.

The total cost of the raises reached $8.3 million with the addition of federal funds and other sources that help pay some state employee salaries, Bandy said. The money was not available to teachers and educators, nor the state’s university system.

About 80 percent of the pay raises went to workers who made between $35,000 and $75,000. But for 14 high-paid state employees, the pay hike topped $10,000, boosting them to more than a $150,000 a year. Most were highly trained medical professionals at the Department of Health and Human Services.

“The salary adjustment fund is a very critical resource we don’t get annually,” said Mark Gogal, the agency’s human resources director. “This is a very focused, very detailed strategy. We had to go after those tough (to keep) positions.”

As the state agency with the second-largest number of employees, DHHS accounted for nearly half of the raises. More than 1,000 nurses and doctors received pay hikes to compete against higher salaries offered by private hospitals, officials said.

The salary increases come as the agency’s leadership is under pressure from state lawmakers concerned about cost overruns and delays in providing services. A salary bump also went to the head of the state’s troubled medical examiner’s office and its forensic pathologists.

Other agencies that received significant attention included the departments of Public Safety and Revenue, the Wildlife Resources Commission, the Office of the State Auditor and state crime lab forensic scientists.

“We developed a plan based on where our auditors were and the market rate,” said Bill Holmes, a spokesman for Democratic State Auditor Beth Wood. “We were having some turnover and that’s where we were having the hardest time recruiting.”

Dana Cope, the State Employees Association of North Carolina executive director, said the fund is important but doesn’t go far enough. He is pushing state lawmakers to put substantial raises for state employees into this year’s budget.

“I’m pretty sure there are more than 3,500 inequities,” he said. “But it’s not a replacement for a pay raise. They are not getting that money because it’s a cost-of-living adjustment like a typical pay raise.”

Frank: 919-829-4698

News & Observer is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere in the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

Commenting FAQs | Terms of Service