By Rivka Liss-Levinson and Gerald Young, MissionSquare Research Institute
Recent research by MissionSquare Research Institute highlights key strategies and actions public service employers can take in 2024 to be employers of choice.
Predicting the future can be a fool’s game, particularly when it concerns the pace of change in artificial intelligence. So, while that technology will continue to have impacts on state and local government in 2024, the list that follows focuses on other areas where public sector managers can make a difference for their workforce in the new year:
1. Engaging New Generations of Talent.
Generational shift in the workforce happens automatically as more older workers retire. However, the challenge of attracting younger candidates to the public sector is a matter of familiarization, promotion, and engagement. Familiarization can start at an early age with visits to city hall or the state capitol and robust civic education. As K-12 students think about career choices, public employers should actively promote explorer programs, job shadowing, internships, or short-term service projects. Schools of higher education can also play a role in enhancing the interest of those inclined to public service to select a career in state and local government.
The Institute’s survey of public employees revealed that 49% had some prior part-time or temporary experience with a public agency before taking a full-time job. Bolstering such opportunities may be key to increasing future job applications.
For younger job seekers, motivation often extends beyond salary. In both the 35 and under study and a survey of government fellowship applicants, the factors most often motivating public sector employment were job security, meaningful work, an inclusive workplace culture, and personal satisfaction from being of service to their community. Engaging with applicants and new employees to promote these intangibles, listen to their interests, and collaborate on professional development can lead to long-term workforce stability.
2. Expanding Retirement Plan Auto-Features.
In the public sector, Defined Benefit (DB) retirement plans remain the norm, with most employers also offering a supplemental Defined Contribution (DC) plan or some hybrid. DC plans typically entail the individual participant deciding whether to enroll, in what amount, and how to invest their funds. Given the number of other benefits decisions facing new employees and the tendency among many younger staff to consider retirement as a far-off event, participation remains low.i
Auto-enrollment and auto-escalation provisions enroll all employees at some pre-set default level while allowing them to opt out or change the contribution amount. While such provisions are not new, the new Secure 2.0 law will make them even more common within the private sector. Recent research provides an overview of how auto-features are structured and public sector case studies.
Governments that had not previously implemented auto features or similar agreements with employee bargaining groups may find that doing so both increases retirement savings and makes for a more financially secure workforce.
3. Supporting Employees’ Financial Security.
Two-thirds of public sector employees worry about personal finances while at work.ii In addition, 64% are worried about inflation, and 59% are considering leaving their jobs in the near future.iii Coupled with a lack of competitive salaries ranked as the top reason for leaving,iv employers would do well to consider how to enhance the value of their salaries and benefits to employees as well as the provision of financial literacy education to help employees optimize the use of their resources.
Retirement and health benefits, paid time off, and non-traditional or voluntary benefits all contribute to employees’ financial well-being, along with their understanding of key financial concepts. Available resources include the Institute’s survey and a report on the financial well-being of the public workforce.
4. Understanding and Addressing Student Loan Debt.
While the federal debate on student debt continues, state and local governments will play a critical role in understanding and responding to the debt carried by their current or prospective employees.
In the Institute’s survey on morale, motivation, and retention, 80% of public employees indicated that their debt is a problem, and 77% consider it an impediment to saving more for retirement. Further, 26% currently bear student loan debt for themselves, and 11% bear student loan debt for a family member. Among those 35 and under, 25% are worried about paying back their student loans.v
But how does that translate to those working in specific occupations? The Institute is finalizing a study looking at debt loads for specific degrees and how they impact the ability to hire for hard-to-fill positions. Knowing, for example, the likely debt of a civil engineer, registered nurse, elementary school teacher, or police officer can help employers make more informed choices about debt assistance, tuition reimbursement, or other incentives like hiring or performance bonuses.
5. Modernizing Workforce Systems and Classifications.
The Institute’s 2023 Workforce Survey results reflect both the application of technology and the limitations of that approach. Of the HR managers surveyed, 93% have needed to re-open recruitments at least occasionally due to an insufficient number of qualified applicants. Meanwhile, only 9% of employers offer a mobile app for job candidates to track the status of their applications. Will extended time to hire or a lack of responsiveness simply discourage candidates from considering public employment?
The solution may lie in some of the other common initiatives employers are implementing:
- Completing a compensation or classification study
- Reducing minimum education, skills, or licensing requirements
- Dropping degree requirements for some positions
- Hiring below minimum qualifications for post-hiring upskilling
Change requires balancing the needs of each position, the evolving nature of the work, and the education or experience likely to correlate to professionalism, critical thinking, and specialized skills. Where historical standards for entry-level credentials may limit access to those otherwise qualified to perform the work, amending those standards may lead to a wider array of candidates, less need to re-open recruitments, and mobile apps that actually show progress in filling positions.
The public workforce continues to evolve, particularly with generational change, increased diversity, and heightened competition for talent. Paying attention to the trends outlined here can help employers optimize recruitment, better engage staff, and improve morale and retention. And with success in those areas, public agencies can weather whatever changes AI may bring.
i Even though 38% of state and local government employees have a DC plan available to them, only 18% participate; see Benefits of State and Local Government Employees.
ii See Public Sector Employee Financial Wellness Program Needs and Preferences
iii See Morale, Public Service Motivation, Financial Concerns, and Retention
iv See State and Local Workforce: 2023 Survey Findings
v See 35 and Under in the Public Sector: Why Younger Workers Enter and Why They Stay (or Don’t)
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