Area government payrolls plunge during COVID-19. Will they get help?

The lobby of Dayton City Hall. It has been modified to reduce the risk of COVID-19. CORNELIUS FROLIK / STAFF
The lobby of Dayton City Hall. It has been modified to reduce the risk of COVID-19. CORNELIUS FROLIK / STAFF

While all sectors of the regional economy have been impacted by the coronavirus economic crisis, local governments have recovered lost jobs much more slowly.

Local governments employ more than 32,000 workers in Montgomery, Miami and Greene counties, according to federal labor data, but their payrolls are down more than 11% from a year ago ― which is a steeper decline than some notably hard-hit industries.

Cities like Dayton and Kettering have reduced staff and eliminated positions, and most jurisdictions face tough budget challenges in 2021 because of COVID-19 revenue losses.

Some officials and researchers say local governments could be in big financial trouble if federal lawmakers don’t approve another stimulus package containing rescue funds for the public sector.

“The uncertainty of 2021 will lead to continued negative impacts on the city’s revenue sources,” said Mark Schwieterman, Kettering’s city manager. “Any additional federal and state assistance would assist in stabilizing the 2021 budget situation.”

Greg Lawson, research fellow with the conservative-leaning Buckeye Institute, said he opposes bailing out state and local governments with a “blank check” because they could use that money to try to solve budget issues of their own creation that are not tied to the pandemic.

He said new stimulus funding should only be allowed to help with genuine COVID-19 expenses, like public health, public safety and the delivery of essential services.

 FILE
FILE

Credit: FILE

Credit: FILE

Local governments in the Dayton metro area employed about 32,900 workers in October, which is a decrease of 4,100 jobs from a year ago (-11.1%), according to not seasonally adjusted data from the Bureau of Labor Statistics.

In this region, the only sector with a larger decrease in employment, year-over-year, was state government (-23.8%).

But state government only employs about 4,800 workers in Montgomery, Miami and Greene counties. Local governments employ more than one out of every 12 workers in the region.

Local government employment saw a large drop early in the pandemic, but it was far less dramatic than the labor market carnage in industries like leisure and hospitality, retail and other services.

But other harder-hit sectors benefitted from at least one bounce-back month of strong job growth, followed by continued employment gains, as lockdown restrictions eased.

Local government did not have a similar kind of immediate rebound, and it has registered little growth. Many cities and counties have made major cuts during the outbreak because of significant revenue losses.

Dayton’s city manager instituted a hiring freeze in March, followed by a voluntary separation plan and the elimination of all vacant positions citywide, said Diane Shannon, Dayton’s director of procurement, management and budget.

About 100 unfilled positions were eliminated, saving the city about $7.2 million this year, Shannon said, and 99 employees opted for voluntary separation, saving another $3.5 million.

The city’s workforce has shrunk about 7% from a year ago, to about 1,841 workers.

Diane Shannon, Dayton’s director of procurement, management and budget, says the city is working on a budget correction plan. CORNELIUS FROLIK / STAFF
Diane Shannon, Dayton’s director of procurement, management and budget, says the city is working on a budget correction plan. CORNELIUS FROLIK / STAFF

Kettering had about 958 employees at the end of September 2019, but it employed about 637 employees at the same point this year (down 33%), said Schwieterman, city manager.

“We anticipate that number to continue to decrease for 2021,” he said.

Kettering laid off 201 part-time employees in April and furloughed 42 others, and more personnel changes will occur through attrition moving forward through next year, Schwieterman said.

A hiring freeze for non-public safety positions led to many vacancies, and most vacant positions will not be filled in 2021, he said.

Montgomery County slashed $30 million from its 2020 budget this year, and the board of county commissioners is cutting department budgets 3% in 2021, said Deb Decker, the county’s interim director of communications.

The board of commissioners was able to avoid layoffs by cutting in other areas, and the across-the-board cuts next year should help the county maintain its workforce, she said.

But the county this year implemented a hiring freeze for some noncritical positions that were vacant at the start of the pandemic, including 55 that were under the board of commissioners, Decker said.

The county employs about 4,149 people, including more than 1,600 under the board of county commissioners.

Moraine froze hiring for some non-public safety positions, and it has not filled a few positions as it measures the continued impact of this crisis, City Manager Michael Davis said.

Moraine’s employment has remained pretty steady at 150 employees (105 full-time), except for a short period of furloughs and temporary layoffs of part-time recreation workers when Gov. Mike DeWine ordered recreation centers to close, he said.

Most of those workers have been called back, Davis said, though some have not returned, like some Civic Center employees, since the facility has not reopened to the public.

File photo 2010.
File photo 2010.

Credit: Ron Alvey

Credit: Ron Alvey

Moraine, like many local communities, received federal coronavirus relief funding (CARES Act money) for COVID-19 expenses.

But the city would like to see help with revenue replacement and hopes any additional federal aid that is approved could go toward plugging those holes, he said.

Trotwood’s property tax and income tax collections are down 4% and 2%, respectively, Trotwood City Manager Quincy Pope said.

Trotwood will see a significant financial impact if federal lawmakers do not approve a new stimulus package containing aid to the business community later this year or in the first quarter of 2021, he said.

The city employs 139 people and so far has not reduced personnel due to COVID-19, Pope said.

But Trotwood early this year froze all nonessential spending and hiring, except for replacement personnel, he said.

Centerville said it has about the same number of full-time employees as it did a year ago (127), and Huber Heights (351 workers) says it has not made any job cuts and has no plans for cuts in 2021.

But because the Rose Music Center did not open this year, 125 seasonal employees did not return to work.

Local arts and entertainment organizations across the region, including Rose Music Center in Huber Heights, raised awareness about their industry’s financial plight on Red Alert Day of Action on Tuesday, Sept. 1. TOM GILLIAM/CONTRIBUTED
Local arts and entertainment organizations across the region, including Rose Music Center in Huber Heights, raised awareness about their industry’s financial plight on Red Alert Day of Action on Tuesday, Sept. 1. TOM GILLIAM/CONTRIBUTED

Credit: Tom Gilliam

Credit: Tom Gilliam

In Centerville, no positions were cut or reduced because of the pandemic, but some hours were reduced for seasonal employees who work in food service, City Manager Wayne Davis said.

State and local government could face cuts next year if lawmakers do not approve bailout funds, said Richard Stock, director of the Business Research Group at the University of Dayton.

“Without help from the feds, it will get worse next year,” he said. “There’s no way to avoid it.”

Lawson, with the Buckeye Institute, said it’s important that lawmakers be careful in how they structure any additional stimulus they approve.

Funding should be designated for specific needs to prevent governments from using what are supposed to be coronavirus-relief dollars for unrelated budget holes, debts and expenses like pensions, he said.

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