As Labor Day weekend kicks off, state workers will join the millions firing up the grill or heading to the beach for one last taste of summer.
But there won’t be as many as in past years. Census data show the number of full-time state employees in Maryland has dropped from about 83,000 in 2007 to about 78,000 in 2011. And in the coming years, that trend isn’t likely to change.
Experts say a stagnant economic climate and a gradual rise in anti-tax sentiment are likely to diminish the size of Maryland’s state employee work force by 2020.
“More likely than not state government will be smaller,” said economist Anirban Basu of the Baltimore-based Sage Policy Group. Part of that will be because of increasing resistance to taxation, he said.
A tax increase passed in this year’s first General Assembly special session, which raised the income tax for 14 percent of Marylanders, might prove to be a step too far in the minds of many stakeholders, Basu said.
If the state’s next governor — to be elected in 2014 — is more concerned about the tax burden than government services, the size of the government is likely to shrink, he said.
The situation would be compounded by a few years of poor economic performance, which likely is to be brought on by expiring federal tax cuts, diminishing federal aid and an aging population that chooses to leave Maryland for a lower-tax state upon retirement, Basu said.
National economic figures suggest unemployment is going to stay high at least until 2014, said John Bambacus, a former state senator and retired professor of political science at Frostburg State University. “I see state employment basically remaining static,” he said.
Unemployment in Maryland hit 7 percent in July, while the national rate rose to 8.3 percent.
High unemployment could spur the anti-tax sentiment that’s gained traction in many Midwestern states but hasn’t taken firm hold in Maryland, Basu said.
“People will look at the data and say, ‘Something is wrong,’” he said.
Maryland’s high quality of life and top-ranked schools won’t take the blame, Basu said. Tax policy will be accused, and the size of government will be trimmed correspondingly.
Christopher Summers, president of the conservative Maryland Public Policy Institute, already sees Maryland as having a “toxic tax environment,” focused more on raising revenues than attracting private-sector businesses.
Summers, however, foresees the size of government increasing, particularly in areas with influential unions such as education and transportation.
The aging population of state employees also could lead to a younger state work force, Basu said. Currently, many state workers are from the baby-boom generation; they will be retiring by 2020, he said.
Those retirements will offer younger workers new chances to start careers in the state government.
“In an environment with not enough jobs for young people with degrees, [government jobs] will be attractive,” Basu said.
But Neil Bergsman, director of the nonprofit, nonpartisan Maryland Budget & Tax Policy Institute, isn’t so sure. Many state employees are working with aging, slow computer systems that don’t compare with what young job seekers are used to.
“It’s not going to excite 20-year-olds that this is a place they want to spend a lot of their career,” Bergsman said.
Cuts to pension funds or increases in health care co-pays could continue to make state jobs less competitive than private jobs, he said. But with revenues for fiscal 2012 coming in higher than expected, it was unlikely the governor and General Assembly would make cuts to those benefits in the coming budget year, he said.
State workers already make as much as 10 percent to 20 percent less than their colleagues in the private sector, Bergsman said.
“I’m hopeful that as the budget stabilizes a bit, [the state] might look at compensation and [technological] upgrades,” he said. Until then, the work force is likely to stay the same size or get smaller, he said.
When cuts come, they’re often to the health and public safety sectors, which tend to have the most employees,” Bergsman said.
Reductions in state services open the door to privatization, which can lead to poor oversight, particularly of social service providers, said Patrick Moran, director of AFSCME Maryland, the union that represents state employees.
In recent years, a number of private group homes for troubled children have come under fire for not properly screening their employees, which in some cases included ex-convicts.
“Continuing to reduce the work force reduces safety,” Moran said.
Maryland unions also could face attacks similar to the one in Wisconsin, where Republican Gov. Scott Walker led efforts to strip public-sector unions of collective bargaining rights, he said.
“That could happen in any state anywhere,” Moran said.