Management & Labor

The 'Silver Tsunami' Has Arrived in Government

Significantly more state and local workers are retiring or quitting, according to a recent survey.
by | May 31, 2016
In some cases, the uptick in retirements may have been spurred by cuts to pension and health-care benefits. (AP/Mel Evans)

For years, there have been warnings about the forthcoming retirements of a large segment of the public sector’s most experienced workers. Now, it appears those retirements may be accelerating across many state and local governments.

A new Center for State and Local Government Excellence survey indicates that governments are experiencing an uptick in retirements. More than half -- 54 percent -- of surveyed governments reported an increase in retirements last year from 2014, while just 10 percent reported a decrease.

“The looming talent crisis that we’ve been talking about for years is right on our doorstep,” said Elizabeth Kellar, the center’s president.

Older workers in all sectors pushed back their retirement in the years following the Great Recession. In the center’s 2012 survey, about 46 percent of human resources representatives reported workers were postponing their retirements. That figure has declined each year since, with only 21 percent reporting retirement postponements in the latest survey.

Baby boomers at or near retirement age make up a large share of senior-level managers in many agencies. Compared to the private sector, public-sector workers tend to be older and possess higher levels of education.

In Virginia, nearly 12 percent of state workers were eligible for retirement, and another quarter of the workforce was eligible to retire within five years as of last year, according to the state Department of Human Resource Management. Similarly, in Washington state 31 percent of executive branch employees are age 55 or older.

While it’s rare for a large swath of public employees to retire all at once, the expiration of union contracts or cuts to retirement benefits have led to spikes in retirements in a few states. In New Jersey, for example, union officials contend that threats of benefit cuts by Gov. Chris Christie led more workers to retire last year. What’s been called the “Silver Tsunami” will instead play out over a number of years given that the youngest baby boomers just turned 52 years old.

Senior-level fire department staff are one segment that’s been hit particularly hard with retirements, said Kellar. That's partially because public safety personnel are generally eligible to retire earlier than other public employees.

The survey also found that 40 percent of governments experienced year-over-year increases in employees quitting (excluding retirements), while just 11 percent reported declines. That’s up from last year, when 28 percent of responding governments said more employees were quitting. Kellar said poor salary increases or pay freezes that have persisted for years may be one explanation. Another contributing factor could be large numbers of younger workers seeking new employment as they tend to switch jobs more than veteran employees.

Don't Know, Unchanged, Lower, Higher

At the same time, governments report that they’re also hiring more workers. Sixty percent of survey respondents hired more employees last year than in 2014, compared to just 8 percent hiring fewer workers. More recently, employment estimates published by the federal Labor Department suggest overall local government employment picked up modestly over the first few months of this year. Meanwhile, state government job estimates have remained mostly flat for more than a year now.

The extent to which individual local governments are able to hire more workers or replace those who retire varies greatly as property taxes and other major sources of revenue have yet to fully recover from the recession in some jurisdictions.

Not surprisingly, recruiting and retaining qualified workers were identified as the most important workforce issues to governments in the survey. Not too far behind were succession planning and staff development.

That's something the Los Angeles County, Calif., government -- which saw retirements climb 20 percent in 2015 -- is already working on. To prepare the workforce, management-level employees participate in experienced-based and classroom learning programs. Each of the county’s 34 departments are expected to maintain and carry out their own succession plans.

Most participants in the survey, which was conducted this spring, represented local governments and were members of either the International Public Management Association for Human Resources or National Association of State Personnel Executives.

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