After raising state worker wages 20 percent in less than five years, Missouri Gov. Mike Parson said employment benefits will be the factor to make the state competitive in attracting and retaining employees.
"We're not going to compete with Boeing, Ford Motor Company and we're not going to compete with Dollar General stores if they're paying $21 an hour," Parson said. "I just can't do that, so I've got to convince my people to stay here and be loyal."
Parson signed the largest state employee pay raise in recent memory on Monday, giving state workers an extra 8.7 percent on their paychecks. The measure also includes a $2 per hour increase to the state's shift differential -- an extra bump in pay for those working outside normal business hours -- for congregate care staff within the Department of Social Services, Department of Corrections, Department of Mental Health and Missouri Veterans Commission.
The pay raise was seen as a tool to combat extreme staff turnover within state agencies and is the second of its kind within two years. Last year, lawmakers approved an emergency supplemental bill with a 5.5 percent raise and $15 minimum wage for state employees.
Staff turnover was exceeding 30 percent across state government before last year's pay raise, state budget director Dan Haug said, and dropped to about 27 percent by the end of 2022. There are approximately 7,000 open positions across state government.
Throughout the budget process, department directors and lawmakers frequently used Fulton as an example of the state's inability to compete with private employers. The largest city in Callaway County, it's home to the Fulton State Hospital and a Dollar General Distribution Site.
Missouri Department of Mental Health Director Valerie Huhn told lawmakers the state psychiatric hospital has 400 open positions. The department reversed course on a $16-million renovation on part of the hospital because of the staff vacancies.
"I don't see a universe where I fill 400 vacancies at Fulton State Hospital, just given what we know about the workforce in the Fulton area," Huhn testified before a House committee.
Parson said the Dollar General distribution site in Fulton is offering $21 per hour and a $2,500 signing bonus.
Looking at strictly dollar amounts, Parson said, the pay raise he signed Monday isn't enough to put the state in competition with Dollar General.
"If you're comparing $16.50 to $21, they'll want the better deal, and that's all it is," Parson said. "But if you look at the benefits of state employees, then I think we compete pretty good."
State employee benefits include nine types of paid leave, retirement plans, health, vision and dental insurance and state holidays off, among others.
A number of bills filed in the General Assembly this year are aimed at modifying benefits and state agency work environments.
Rep. Dave Griffith, R-Jefferson City, and Sen. Mike Bernskoetter, R-Jefferson City, are sponsoring legislation that would give state workers the option of being paid every two weeks, as opposed to twice a month. The measure was approved by the Legislature last year but vetoed by the governor as it was attached to other legislation he disagreed with.
Rep. Rudy Veit, R-Wardsville, is sponsoring legislation to reduce the state employee retirement eligibility age. The current system allows for early retirement when the worker's combined age and years of service to the state reach 90.
HB 89 would reduce the eligibility age from 55 to 50 and allow state workers to retire when their combined age and years of service reach 80. The change would only be in effect when the state retirement system is at least 80 percent funded.
"We're never going to keep employees if we don't have a good retirement system, a good work environment and pay them enough that they can at least make ends meet without undue stress," Veit said Monday at the bill signing for the pay raise.
Veit said he also wants state employee pay raises to become a regular part of yearly budget discussions.
"I think with the way we have inflation now, we're going to have to give a cost of living raise every year or we're going to slide back to the worse position we were at and we're going to lose qualified, good employees," he said.
Bernskoetter is sponsoring an omnibus state employee retirement bill with SB 407, which modifies boards and systems governing retirement and benefits for lawmakers, judges, water patrol employees and more.
Other bills working their way through the Legislature would drop post-secondary degree requirements for some state jobs, allow state agencies to adopt four-day work weeks and permit state agencies to offer employees retention payments or "exceptional employment achievement" payments.
"How do you retain what you have? How do we keep the people with us and be able to recruit people that say, 'Hey, the state government's a good place to come to work?" Parson asked. "That's a challenge for us."
The governor said teacher pay is another area he's tried to address since assuming office. Last year, he championed a program to help increase the starting salary school districts pay teachers from $25,000 to $38,000 annually. To draw down state funding, districts had to contribute a matching amount.
"That takes you from almost bottom-level to middle of the pack, but you're still in the middle of the pack," Parson said, adding more needed to be done to recruit and retain teachers.
The Missouri Teacher Recruitment and Retention Blue Ribbon Commission finalized its recommendations last September, prioritizing pay, stipends and benefits.
Increasing teacher starting salaries to at least $38,000 per year, supporting professional development and creating funds designed to help districts recruit locally were among immediate recommendations. Additional recommendations included mental wellness support and offering student tuition assistance to prospective teachers.
HB 89: Modifies provisions relating to state employee retirement
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NoneSponsor: Rep. Rudy Veit, R-Wardsville
SB 407: Modifies provisions relating to Missouri Department of Transportation and Highway Patrol Employees' Retirement System and Missouri State Employees' Retirement System
Sponsor: Sen. Mike Bernskoetter, R-Jefferson City