Bay State Employees Facing Furloughs
Several Northeastern states with large deficits are forcing some workers to take unpaid days
EVEN though Massachusetts state employee Elaine Federico will put in a regular five-day schedule this week at her teaching job, she will be paid only for 4-1/2 days of work. She will receive the same check, short by half a day of pay, for the next several weeks despite her full five-day workweek. Ms. Federico, coordinator of an arts program for the disabled, is not a victim of discrimination. She is merely a Bay State employee caught in the midst of a $1 billion state budget crisis. Federico, along with thousands of other state employees, must take a certain number of unpaid furlough days as part of a cost-cutting measure initiated by Gov. William Weld (R). She will be reimbursed later by getting 1.25 vacation days after June 30 for each one of the four furlough days she must take.
For many state workers like Federico - who hasn't had a raise in three years - getting by with less pay for the next several weeks won't be easy.
``It's a lousy situation,'' she says. ``If you don't have any more money and you're just making it, what do you do?''
Worker furloughs is just one of a series of Governor Weld's downsizing measures. Weld, a fiscal conservative, has already proposed thousands of layoffs and cuts in state services. Since early April more than 1,900 state workers have been cut - either through attrition, retirement, or layoffs, says Dominic Slowey, spokesman for the state Administration and Finance office. The state's fiscal situation is so bad that Governor Weld is even considering ordering a government shutdown the last week in June.
``It's an option that is on the table,'' Mr. Slowey says. The shutdown would mean all nonessential employees would simultaneously not work for five days in addition to their furlough time, Slowey says.
The Bay State furlough program includes two other options besides extra vacation time: don't work and don't get paid, or work and get paid later when retiring or leaving the job. The number of furlough days is determined by an employee's annual income; the greater an employee's income, the more furloughs he or she must take.
Other Northeastern states, caught with budget deficits in the midst of a regional recession, have enacted or at least considered similar measures:
* Rhode Island Gov. Bruce Sundlun (D), struggling with a $250 million budget deficit, initiated a government shutdown plan earlier this year. But the Ocean State has had only three shutdown days out of a planned 10 this fiscal year due to a recent union agreement. Instead of a shutdown, employees will take furlough days and be paid back later or given vacation time in fiscal year 1992.
* In Maine, most employees, except those considered essential - like health-care workers, police, and corrections officials - must take three unpaid furlough days by June 1. Gov. John McKernan (R) has proposed 20 furlough days for fiscal year 1992.
* Furloughs have been proposed by governors in New York, New Hampshire, Vermont, and Pennsylvania.
Governors turn to furloughs - as opposed to layoffs - as a temporary cost-cutting measure, says Ronald Snell, fiscal program director of the National Conference of State Legislatures.
``Furloughs are a more expedient remedy that can provide fairly substantial savings in short order,'' Mr. Snell says. ``From a governor's point of view, it can make both fiscal and political sense.''
Bill Smith, a state-employed accountant from Woburn, Mass., must take seven furlough days before June 30. Although he says he won't be severely affected financially, he is nevertheless concerned about the future. ``I got a boy going to college,'' he says.
Massachusetts' furlough program amounts to a relatively small amount of savings in the state's overall budget deficit. It will save about $65 million out of an estimated $1 billion deficit, Slowey says.
State employees, for their part, say furloughs will severely impact the economy - forcing more unemployment and less spending power. But according to Federal Reserve Bank of Boston economist Robert Tannewald, the performance of the region's leading industries drives the overall regional economy.
Bay State workers will nevertheless feel a direct impact. Federico, who works at the Wrentham State School, in Wrentham, Mass., is divorced and has no children. She does own her own home, however, and is worried about making mortgage payments which amount to about $250 a week. She has considered filling in the gap with outside employment but times aren't easy. The state unemployment rate hit 9.7 last month, the highest in 15 years.
``I'm looking for a second job but I can't find one,'' she says. ``I don't have kids so I [would] work any hours, any days, but I can't find anything.''
But many Northeastern state governors, caught with worsening budget deficits, see no other alternatives but drastic cost-cutting measures such as employee furloughs. ``A lot of these states have been in bad shape for three years at least. They used up all the reserves they had,'' says Marcia Howard, research director of the Council of State Budget Officers. ``While [the worker furlough] is very dramatic, it is not altogether unanticipated.''