Parson recommends wage increases for all state employees

(From Gov. Mike Parson)

Today, Governor Mike Parson announced that he will recommend a 5.5 percent Cost of Living Adjustment (COLA) and $15 per hour minimum base pay standard for all state employees across state government.

"With many positions across state government facing turnover rates anywhere from 10-100 percent and vacancy rates from 30-100 percent, it is past time for us to make these investments in our state workforce, which remains one of the lowest paid the nation," Governor Parson said. 

"Our direct care and front line staff often make less than entry-level retail positions. These public servants have tough jobs and rarely receive the thanks they deserve, and communities all across the state rely on them everyday."

The recommendation will be included in Governor Parson's Supplemental Budget request to be introduced at the beginning of the 2022 Regular Legislative Session, which begins on January 5, 2022, with the goal of passage before February 1, 2022. These salary adjustments will require General Assembly approval before they can go into effect.

Governor Parson has recommended three percent and two percent COLA increases for state employees in past budgets, yet Missouri state employees continue to be among the lowest paid in the nation. On January 1, 2022, state employees will receive a two percent COLA increase.

If Governor Parson's FY 2022 supplemental budget is passed early by the General Assembly, state employees would receive an additional 5.5 percent COLA increase on February 1, 2022, along with increases for those making under $15 per hour and those affected by compression.

The FY 22 supplemental budget pay plan proposal would cost $91 million, including $52 million in general revenue (GR).

Going forward, Governor Parson's FY 23 pay plan proposal includes a similar 5.5 percent COLA recommendation and totals $218 million, including $123 million in GR.

"Veterans home care attendants, residential aids for vulnerable children, and highway workers are among the lowest paid state workers, yet they are critical to maintaining state services and increasing the quality of life for all Missourians," Governor Parson said. "These pay increases are necessary for our team members who provide dedicated service to Missourians day in and day out, and we are calling on the General Assembly to help us make these critical investments in our state workforce."

Governor Parson's Fiscal year (FY) 2022 supplemental budget recommendation includes:
5.5 percent COLA increase for all state employees;
Increases to $15 per hour for any state employee making below that threshold; and
Increases to address compression issues between pay grades after base pay increases to $15 per hour.

"I recognize the urgency and support an early supplemental," Missouri House of Representatives Budget Chair Cody Smith said. "This will ensure that the state is able to retain talented employees who will continue providing essential services to the citizens of our state."

The 5.5 percent COLA increase is based on the average increase of four general structure adjustment economic indicators:
Consumer Price Index for the Midwest – 6.4 percent;
Employment Cost Index – 4.3 percent;
World at Work Salary Budget Increases – 2.9 percent; and
Personal Income – 8.3 percent.

"Despite regular pay increases, Missouri's state employees continue to rank among the lowest paid in the country," Missouri Senate Appropriations Chair Dan Hegeman said. "This pay plan proposal will raise the minimum base pay, reduce pay compression, and ensure Missouri is able to recruit and retain talented and dedicated public servants."