Opinion: Is MCGEO Victim or Victor?
Paying the price for deferred raises for county union employees
In the aftermath of the County Council’s unanimous vote to reject its contract, MCGEO – the largest county employee union outside the public school system – reacted with great unhappiness.
In an email to its members, the union said, “We will have to fight, make no mistake, to get what we deserve, but that’s always been the case… We’ve never backed down from a fight, and we won’t forget this betrayal.”
MCGEO believes that dissenting council members are currying favor with The Washington Post’s editorial board, which strongly opposed its contract, and also alleged that several council members said they were voting in favor of the contract but instead voted no. The result of the council’s action is a revised contract under which MCGEO will be getting a peak raise of 6.75%, down from its previous top raise of 9.4%.
So is MCGEO a victim of anti-union council members? Or is it in fact effective at regularly winning significant wage hikes for its members?
To answer that question, I looked at three data series. First, I examined the union’s contract results from fiscal 2011 (the first year the Great Recession seriously hit the county budget) through the present.
MCGEO’s compensation includes general wage adjustments, which all members get; step increases, which roughly 70% of its members get; longevity increases, which some of its members who are at the top of their scales get; and a variety of smaller wage adjustments including lump sums.
In fiscal 2020, those of its members who were employed by the county in 2011 or earlier will be getting part of an additional deferred step to make up for the step that was not funded at that time. For the purposes of simplicity, I combined the general wage adjustments and the step increases, which together reflect the wage hikes that most MCGEO members receive.
Second, I looked at the mean wage for all workers in the Washington metropolitan area calculated by the U.S. Bureau of Labor Statistics’ Occupational Employment Statistics program. Changes in the mean wage for all workers reflect the raises earned by workers throughout the local economy.
And third, I looked at changes in the Bureau of Labor Statistics’ CPI-W for the Washington-Baltimore region to gauge cost-of-living increases for workers.
The table below shows how those measures compare from 2011 on. Washington area mean wages are available through 2018 while inflation is available through 2017.
There are two time periods in this data. From fiscal 2011 through 2013, MCGEO received no general wage adjustments or steps. Washington-area mean wages and inflation both rose.
So during these three years, there is no question that MCGEO members fell behind both other workers and the cost of living. But from fiscal 2014 on, MCGEO’s combined general wage adjustments and steps exceeded Washington-area mean wage increases and inflation.
For the 2011-2017 period, MCGEO’s increases were an average 3.36% per year compared to 1.62% inflation. For the 2011-2018 period, MCGEO’s increases were an average 3.63% per year compared to an average increase of 1.64% in Washington area workers’ mean wage. This means that even including the bad years, MCGEO did better than other workers as well as inflation.
Here’s another way of looking at this. Let’s consider three hypothetical workers, each of whom was earning $50,000 in 2010. Worker 1 received wage increases equal to MCGEO’s general wage adjustments and steps through 2018. Worker 2 received the average increase in Washington-area mean wages. And Worker 3 received wage increases equal to the rate of inflation.
How much would each worker earn in 2018?
The table below shows the wage increases for all three workers. (Inflation is assumed to be 1.62% in 2018, the average increase of 2011-2017.) Worker 1, who received MCGEO’s wage hikes, did not get a raise for three years but caught up later, making $66,272 in 2018. Worker 2, who received the average Washington-area wage increases, made $56,962 in 2018. Worker 3, who received wage increases equal to inflation, made $56,827 in 2018.
Two things stand out here. First, the average Washington area worker’s pay rises about as fast as inflation. That lack of real-dollar wage growth is a major problem in the Washington area’s economy and is something that all local policymakers should keep in mind when considering tax hikes. Second, even with the three zero years, the worker with MCGEO’s pay increases made over $9,000 more than the workers earning area average and inflation-adjusted increases.
Now to the present day. MCGEO didn’t get everything it wants this year. Notably, it wanted a 3.5% step increase denied to its members during the recession (a “make-up step”) funded in fiscal 2020. Instead, it will have to settle for getting it funded over multiple years. But it did secure an important concession from the County Council: recognition that compensation lost during the recession should be restored. The council was mostly at that point anyway given its past funding of make-up steps for other unions, as MCGEO rightly noted, but now the precedent is firm. MCGEO and its allies in the police and firefighter unions will be sure to cite this after the next recession. Make no mistake – politicians come and go, but in MoCo politics, nobody has a longer memory than the county employee unions.
All of the above shows how effective MCGEO truly is. It’s a really, really good thing to be a MCGEO member! Far from being a victim, MCGEO is often a big winner at the bargaining table and in the county budget. That’s no surprise given the union’s political activism, its tough tactics and the two-fisted competence of its fearsome leader, Gino Renne. Politicians beware!
Adam Pagnucco is a writer, researcher and consultant who is a former chief of staff at the County Council. He has worked in the labor movement and has had clients in labor, business and politics.