With the COVID-19 outbreak continuing during these uncertain times, the virus has created many challenges to state and local government agencies and directly impacts their employees. It is essential to understand the public sector workforce’s agency’s perceptions of COVID-19 and what the short, medium and long-term impacts of the pandemic include, as well as the afterward result of the economic crisis. With the increase of financial difficulties and stress in the workplace and on these employees’ lives, it’s crucial to improve the public sector workforce’s financial wellness and other factors in the state and local governments.
COVID-19 has brought many economic consequences regarding the impacts of people’s jobs, debt, finances, and other factors. Additionally, the projection for state and local governments will not be straightforward. According to the U.S. Department of Labor, Bureau of Labor Statistics, there is a projection of a $360-billion revenue shortfall in cities, towns, and villages between 2020-2022. Additionally, tax revenue declines of over 20 percent will be affecting some states.
According to SLGE and Greenwald & Associates, regarding these revenue and tax shortfalls, the reopen of many state and local agencies across the nation holds many concerns with a second wave of COVID-19 cases. The reopen will correlate to the revenue shortfall is balancing agency budgets. During the reopening of state and local agencies, to ensure the public sector workforce can respond to the challenges of COVID-19, it’s essential to understand the perception of employees’ views on the pandemic and how their jobs, lifestyle, and finances have had an impact.
The Center for State and Local Government Excellence reports that prior to COVID-19, 88% of employees have been worried about their finances, and 66% worry about their finances on the job. The pandemic has negatively impacted government workers and their families and expects the financial impact to become increasingly worse over the next year. Workers are concerned about if they can retire when they want and if they can save enough to be financially stable during retirement.
“The average 401(k) balance reached $106,000 in 2019, up 2% from last year. However, 48% of employees 55 and older have nothing saved in a 401(k) plan, despite more than half of employers offering this benefit,” according to the U.S. Government Accountability Office.
While the public sector workforce has many concerns about their finances during this time, offering financial literacy programs to state and local government works to become more confident in their relationship with money and help make smart financial decisions. Programs like this will help reduce concerns for the uncertain future and help agencies become more productive.
Amongst the COVID-19 pandemic, there is a significant concern for the public sector workforce affecting agencies and employees together. Enhancing financial security for state and local government workers and agencies will be important when facing the challenges of these uncertain times.