The Hiring Crisis at America’s Largest Employer

• The US government, especially at the local and state levels, is the country’s largest employer, forming an important part of communities and local economies. Since 2022, state and local government job postings have surged, outpacing the growth in private sector opportunities.

• State and local governments take about twice as long to interview candidates on average and offer lower base salaries, thereby hindering governments’ ability to attract talent.

• While government salaries lag behind the private sector, government jobs offer stronger job security, pensions, and benefits. As a result, as the economy softens and economic uncertainty increases, government work becomes more appealing to many more people.

State and local governments form the backbone of our communities and local economies, providing critical public services, including local administration, infrastructure maintenance, education, and emergency response. In recent years, especially following the pandemic and the “Great Resignation,” local governments have experienced a major exodus of talent, creating an urgent need to quickly fill critical positions.

Reflecting this trend, Revelio Labs’ workforce data shows that the number of state and local government job postings has increased dramatically since 2022. Despite the increase in open roles, governments’ ability to fill those roles has not kept pace. This has created a talent shortfall, with serious implications for public services and governance.

This week, with insights from Work for America, who spoke to government talent leaders across the country for their recent report From the Frontlines, we explore some of the factors leading to staffing shortages in cities and states across the country.

While the number of job postings in state and local government has grown dramatically over the past two years compared to the private sector, workforce growth has not kept pace. The struggle to fill these roles is driven by several factors, including lengthy hiring processes and lower-than-market salaries for some roles.

One key obstacle to securing talent for local governments jobs is the lengthy recruitment process, something that is frequently cited by local and state government leaders who informed Work for America’s report. Local and state governments are often slower than the private sector in filling roles, with interview processes that last about twice as long as the private sector on average and extended decision timelines. Not only does this leave agencies short-staffed for longer periods, but it also discourages potential applicants, who may accept private sector offers before the government hiring process is completed.

Another challenge lies in the pay discrepancy between public and private sector jobs. Administrative roles, for example, show a noticeable salary gap between the public and private sectors. Local government jobs often offer lower base salaries, making it difficult to compete for top talent.

Yet government jobs continue to be attractive for many candidates due to the long-term stability that comes with those roles. While paychecks are smaller, government employees benefit from job security, generous pension plans, and robust benefit packages that many private sector roles do not offer. These rewards remain a key factor in attracting individuals who prioritize long-term security over immediate financial gain. In addition, government jobs often offer more meaningful work than elsewhere, supporting others in their community. State and local government leaders interviewed for Work for America’s report indicated that the sector needs to get better at communicating the full value proposition of government roles throughout the recruitment process.

Our workforce data show that both state and local government employees have much lower turnover than private sector employees, even in similar roles. While last month’s attrition for private sector roles stands at (a historically low level) of 11%, attrition in state and local governments hovers around 8%, indicating that about 8 in 100 people leave their positions in a given year.

From employee review data, we see that government employees in state and local governments more frequently mention their pension and retirement benefits than private sector employees do. They also mention their community and colleagues more, corroborating the view that government jobs make up for lower pay with more meaningful and fulfilling jobs.

As the demand for state and local government services continues to grow, addressing recruitment and retention challenges is critical. The future of effective governance depends on how well governments can adjust to the changing job market and compete for the talent they need.