Job vacancies are inevitable.  Workers quit, retire, get ill; vacancies open opportunities for others.  The openings are posted, job seekers apply, interviews begin.  It’s an ongoing Job for HR.  For employees, job vacancies are opportunities for promotion and career progress. Unexpected retirements or ‘quits’ disrupts work teams for a time, often causing a decline in work unit performance.  New hires need time to reach expected performance levels. That’s been routine for decades.

But COVID changed that reality.  For a year, businesses closed or laid off employees.  Deaths and hospitalizations skyrocketed. The experience working remotely triggered the “Great Resignation.”  The crisis occurred at a time when millions of Boomers were approaching retirement.  A number of recent columns argue the pandemic “has changed work forever.”  Vacancies mushroomed.

The monthly job opening data compiled by the BLS confirm the magnitude of the problem.  At the end of 2007, prior to the 2008/09 recession, state and local government employers had 395,000 openings.  At the end of 2019, the total was 328,000.  In September, the total was 852,000 – a 160% increase.

In the past, with a growing population, there were always more people looking for a job than the number of openings.  At the end of 2010, the BLS reported under 3 million job vacancies and 15 million unemployed – that’s 5 job seekers for every job opening. But since then, labor markets have gotten steadily tighter.  Today, the data show 0.7 job seekers per opening. The country does not have enough job seekers to fill all job vacancies – and the demographics suggest the problem will continue.

The problem is worse for government agencies. They have more workers close to retirement while demographic trends show fewer young people in the age 20-24 cohort starting their careers.  Additionally, recent surveys show few young job seekers are interested in working in government.  When that’s combined with below market salaries, it’s not surprising that growing vacancy problems have been reported at all levels of government.

In a number of cities, the vacancies have been reported as a “crisis.”  In New York City, as a prime example, the city’s Comptroller released a report in December 2022 that began , “New York City government is in the midst of a vacancy crisis across many City agencies.”  In Atlanta, the “Cobb government spent millions to fix the staffing crisis. It got worse.”

Vacancies are more serious in cities than in state and federal government because the failure to maintain essential services can have an almost immediate impact on the people served.  When jobs go unfilled, it can cause problems for city residents.  In a number of cities, large and small, it “led to a deterioration in critical city services . . .” according to the New York Times.

The Diversity of City Operations Adds to the Problem

Cities are the ultimate ‘conglomerate.’  That word is rarely used today but it refers to a company that operates a number of highly diverse, subsidiary businesses.  GE was the most prominent.  At no time, however, was GE or any of the others close to the diversity of city operations.

City departments cover virtually every aspect of living in cities.  The New York City report shows vacancies across the full range of operations, starting with the business services department and ending with the fire department and payroll administration.

The key point is that city departments depend on employees in a far more diverse array of occupations than organizations in other sectors.  Companies all have the common goal of financial success; that makes their organization and approach to management similar.  In contrast, city agencies are very different, with differing staffing configurations, differing cultures, and they operate within differing legal frameworks. The departments also look to different segments of the labor force for hiring.

Business conglomerates failed because of management problems.  Years ago, I managed the compensation program in a conglomerate with nearly 30 subsidiaries as diverse as a telephone answering service in Toronto, a sugar producer in Hawaii, and a local water utility.  Each had its own executive team that handled all the management issues locally except for executive compensation – that was my job.  Each month the operating companies submitted their financial results, and as long as the numbers met expectations, the corporate staff stayed away.  Failing operations were sold or shut down.

Government leaders of course do not have that flexibility.  When public services are disrupted or fail, it’s rare for leaders to have the authority to undertake ‘quick fixes’ or to have proven strategies to do that. Corporate CEOs can act quickly to solve problems, but elected officials often run into strong resistance.  Additionally, many have to overcome laws and regulations decades old.

City agencies are like conglomerate subsidiaries in that each has its own mission and management issues.  The mix of knowledge and skills needed to lead as well as work in Parks & Recreation is clearly different than in a Head Start agency or in City Planning. That may be obvious but the mix of agencies and occupations in city government has significant implications for a central Human Resource office.

The dilemma is that a central HR office cannot be expected to stay abreast of the developments in every occupation’s labor markets.  To illustrate, what’s impacting the supply and demand – and the pay — for Civil Engineers is very different than for Social Workers or for Software Developers.  And there are employees from at least another 25 job families found on a city’s payroll.  It’s unrealistic to expect a central HR office to stay on top of what’s currently important for each job family.

It makes more sense to expect someone, ideally with an HR background, in each department to stay on top of what’s happening in relevant labor markets.  That’s especially important where vacancies are seen as a ‘crisis.’  They should be following the issues driving resignations, enrollment in relevant college programs, recent pay increases, layoffs in local markets – all the factors that influence the strategies for staffing and filling vacancies.  They can also conduct exit interviews, periodic surveys, or host employee focus groups to understand the problems that affect worker engagement.

There are of course jobs found in multiple departments.  Lawyers with different titles and roles are perhaps the most common.  Administrative support jobs are also common.  It’s important to classify them the same way across all departments.

There was a time when staffing was routine.  Jobs and organizations were largely stable over time.  When a vacancy occurred, HR pulled the job description from the files, talked briefly to the manager, posted the vacancy, and waited for applicants.  But the reported “alarming” drop in the number of applicants shows that’s no longer working. Although it’s gotten worse with COVID, that’s been a long term problem.

In the private sector, websites like Indeed or Glassdoor are now the starting place for job seekers.  Careers in Government is the best choice for government jobs.  But the majority of public employers continue to rely on their own websites, which obviously limits the possible applicants.  Government’s reputation or brand adds to the problem.  Simply dropping degree requirements is unlikely to change the minds of “young adults with little interest in working for government.”

Developing new staffing strategies – that is ideas that produce more and better candidates – should be a joint effort bringing together the individuals in departments who understand what’s affecting the supply of qualified job seekers with HR specialists good at posting jobs and assessing applicants. They need to seek out ways to make broader audiences aware of job vacancies.

Pay Is Important but There is More to Recruiting

The NYC Comptroller report makes an important point – the vacancy problem is “driven far more by where there is private sector competition for workers.”  There are vacancy problems in every sector and clearly companies do not have the same constraints on offering higher salaries and hiring bonuses to attract applicants.  The continuing high demand for IT specialists and its impact on starting salaries highlights the problem for public employers.  Now the shortages for healthcare specialists are driving up salaries. It’s important to understand the ‘competitors’ and labor markets from department to department.

Comparative pay increases – Exhibit I — since mid-2019 for jobs in the private and public sectors confirm the problem.  The data clearly support the need for flexibility in granting increases.

Public employers also have to recognize that the ‘total compensation’ argument and the importance of benefits to older workers is far less meaningful to young job seekers.  Retirement benefits 20 or more years in the future are not going to attract current graduates.

But pay is not the only issue.  Private employers are also acting to improve the work experience to attract and retain workers.  The Great Resignation prompted them to adopt more aggressive recruiting tactics, offering flexible work schedules, addressing DEI issues, investing in better onboarding and career development, and training managers to be more effective in the new work environment.  The new thinking has been discussed in numerous books and columns.

A recent column argued for convincing CEOs to “become your organization’s Chief Recruiter,” supporting efforts to improve recruiting results.  They can also support efforts to convince employees why “your organization is a top place to work.”  But that requires a commitment to change.