Furlough days may not save that much money

October 15, 2009 6:42:17 PM PDT
The governor's controversial money-saving order that forces state workers to take days off without pay may not be saving that much money after all. A new University of California, Berkeley study finds the forced furloughs are costing workers quite a bit, but not really helping the state.

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The UC Berkeley Center for Labor Research and Education looked at the short-term savings from furloughing state workers three days a month, and then took into account the federal dollars lost, fewer taxes collected and pension debt pushed off into the future.

It found the cash-strapped state is only saving 37 cents for every dollar it cuts out of state worker wages and benefits, and that number drops in future years.

"I think our conclusion is quite clear that this program is poorly designed," researcher Ken Jacobs said.

The center does receive some of its funding from pro-labor groups, but researchers insist that played no part in their findings because the numbers came straight from the state.

"There's nothing here to balance either way, this is all pretty straight-forward math," Jacobs said.

The Schwarzenegger administration disputes the calculations. Aides say three unpaid days a month through June help save $2 billion from the general and special funds.

"We're saving hundreds of millions of dollars in this budget by doing the furloughs; we understand how difficult it is, it's not something we would like to do," the governor's press secretary Aaron McLear said. "State workers should not be shielded from economic realities that everybody else in the state is facing."

Three furlough days amounts to roughly a 14 percent pay cut, which is equivalent to seven weeks of pay.

State workers think they are suffering needlessly if the savings are minimal in the long run. Some are behind in bills and have received foreclosure notices. Caltrans equipment operator Clayton Brown pulled his daughter out of college.

"I had to tell her, 'No more,' so, she's sitting at home, nothing to do, no money; hardest thing I ever did in my life," Brown said.

Interestingly, the study contends the state would save just as much money by furloughing workers just one day a month, instead of three, because those second and third days off cause too much chaos which disrupts worker productivity.

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