Finance Employees Are Fastest-Growing Segment of Local Government Workforce

Local governments in nearly all states reported slight increases in staffing for accounting, budgeting and other areas of public finance.
by | November 6, 2018
Numbers on a spreadsheet.
(Shutterstock)

Most local governments haven’t been on hiring sprees lately. But one area where they appear to be adding employees is finance.

The latest data from the Census Bureau’s Annual Survey of Public Employment and Payroll shows that employees working in finance-related roles increased 5.4 percent between 2014 and 2017. While that might not be a big jump, it’s significant in that it’s the highest of any workforce category tracked in the Census survey.

Finance jobs peaked in 2008, subsequently declined as governments made recession-era cuts and then changed little until 2016. Since then, they’ve expanded at roughly double the rate of total local public-sector employment when education jobs are excluded. Other areas of local government experiencing noticeable growth, albeit at a slower pace, include transit, fire departments, parks and recreation.

 

 

Although payrolls are growing slightly, total U.S. local government employment remains just below pre-recession levels. It’s also worth noting that, despite the uptick, finance employees still account for only a tiny share of the overall public workforce. The Census survey counted about 239,000 full-time equivalent finance employees last year.

Localities in all but five states and the District of Columbia reported increases in financial administration workers over the three-year period. In nine states, the increase exceeded 10 percent: Idaho, Kansas, Louisiana, Nebraska, New Hampshire, Pennsylvania, Tennessee, Utah and Washington. (The bureau’s definition of “financial administration” employees includes those working in accounting, auditing, budgeting, purchasing, revenue collection and other finance activities.)

There’s no single explanation for the increase. But, according to Emily Swenson Brock of the Government Finance Officers Association (GFOA), one factor may be the reorganization or centralization of finance offices. A city, for instance, may consolidate financial activities within each department into a central office. So it might not be that localities are hiring employees working on finance and budget activities, but merely shifting them around.

Relatedly, greater professionalization of public finance could also be playing a role. GFOA reports the number of people taking exams for its certified public finance officer program increased significantly in recent years. Over the past three years, an annual average of 438 people took exams, about 200 more than prior years. Jeff Broughton, director of the Tennessee City Management Association, notes the state passed a law in 2007 requiring nearly all cities employ certified municipal finance officers. The state recorded one of the largest increases nationally in recent years, possibly a result of cities continuing to add certified personnel.

Strengthened reporting requirements, according to GFOA’s Brock, could further be driving up the totals. The Securities and Exchange Commission initiated new disclosure mandates for issuers of municipal securities, while the Governmental Accounting Standards Board has also implemented new rules.

Local government staffing is somewhat a reflection of its shared responsibilities with states, so a greater burden on localities could result in a shift from states to their local public workforces as well. This doesn’t appear to be happening at the state level, though -- at least nationally. Total state government financial administration employment remained essentially unchanged over the three-year period ending last year, according to the survey data.

Cities and counties with tight budgets, though, are keeping a close eye on their finances. "As states have been restricting aid payments to local governments," says Craig Maher, president of the Great Plains Government Finance Officers Association, "they’re really being forced to do more and manage their resources as effectively as possible."

 

Local Government Financial Administration Employment by State

The following data represent aggregate totals for full-time-equivalent local government financial administration employees within each state:

State 2014-17 Change 2014 2015 2016 2017
Kentucky -6.4% 1,907 1,907 1,849 1,784
District of Columbia -2.9% 1,867 1,639 1,719 1,812
Maryland -2.6% 2,693 2,671 2,674 2,622
New Mexico -2.0% 2,216 2,238 2,261 2,172
Michigan -0.6% 6,484 6,627 6,677 6,442
West Virginia -0.1% 1,710 1,713 1,645 1,708
Montana 0.2% 810 787 842 812
Mississippi 0.4% 2,514 2,468 2,434 2,523
Illinois 0.8% 7,558 7,413 7,441 7,621
Missouri 1.2% 3,869 3,789 3,807 3,916
Connecticut 1.7% 2,202 2,181 2,196 2,239
Nevada 2.9% 1,426 1,436 1,437 1,468
North Carolina 3.0% 7,323 7,262 7,312 7,540
Virginia 3.0% 7,602 7,581 7,498 7,833
New York 3.1% 12,845 12,929 12,885 13,238
Wyoming 3.2% 760 735 746 784
Hawaii 3.7% 1,055 1,082 1,114 1,094
Arkansas 3.7% 2,258 2,268 2,345 2,342
Arizona 3.8% 4,535 4,484 4,723 4,708
Oregon 4.1% 3,143 3,136 3,183 3,273
California 4.2% 26,230 26,380 26,687 27,329
Maine 4.2% 1,159 1,192 1,213 1,208
Massachusetts 4.4% 4,419 4,455 4,561 4,613
Wisconsin 4.5% 3,693 3,732 3,803 3,859
New Jersey 4.6% 4,895 5,003 5,105 5,122
Alaska 4.8% 910 906 926 954
South Carolina 4.9% 3,389 3,298 3,409 3,556
Georgia 5.5% 7,767 7,755 7,863 8,198
Oklahoma 5.6% 2,874 3,024 2,870 3,036
Indiana 5.7% 4,393 4,283 4,154 4,644
Rhode Island 5.8% 518 534 534 548
Florida 6.5% 17,255 17,529 17,829 18,380
Ohio 6.6% 8,084 8,108 8,067 8,618
Minnesota 7.6% 5,323 5,417 5,466 5,726
Texas 7.6% 17,368 17,532 17,652 18,692
Delaware 7.7% 454 456 475 489
South Dakota 7.8% 1,070 1,064 1,055 1,153
Iowa 8.2% 2,728 2,739 2,702 2,952
Colorado 8.6% 4,543 4,696 4,778 4,933
Vermont 9.1% 594 535 562 648
North Dakota 9.2% 808 856 829 882
Alabama 9.4% 3,885 3,895 3,924 4,252
Utah 10.5% 1,764 1,731 1,710 1,950
Idaho 10.7% 1,337 1,344 1,352 1,480
Tennessee 10.9% 4,303 4,264 4,386 4,772
Pennsylvania 11.0% 7,901 7,934 8,196 8,772
Louisiana 11.5% 3,437 3,325 3,639 3,832
Washington 13.1% 5,598 6,213 6,342 6,332
Nebraska 13.3% 1,647 1,700 1,754 1,866
Kansas 13.9% 2,938 2,999 3,036 3,346
New Hampshire 15.3% 1,029 1,050 1,043 1,186
See employee classification definitions.

SOURCE: 2014-2017 U.S. Census Bureau Annual Survey of Public Employment & Payroll