Oregon Looks to Shrink Middle Management

By: - March 5, 2012 12:00 am

Oregon state agencies may soon be asked to reduce the number of managers as a proportion of their overall workforce with the goal of shrinking government without harming key services. The state last year set a long-term target of having at least 11 state workers for every manager, but a bill passed by the legislature on Friday would push agencies to dramatically accelerate their progress towards that goal.  The governor still needs to approve the plan.

Agencies with more than 100 employees would be required to reduce their manager-to-employee ratios by a factor of 1 each year until they reach the target of at least 11:1. This will be far more difficult for some agencies than others. While the Oregon Health Licensing Agency already has a ratio of 38 employees for every manager, greatly exceeding the target, the Department of State Lands, the Public Utility Commission and the Oregon State Police currently have five employees for every manager.

The measure has received strong support from Republicans, who favor shrinking government, and Democrats, the Service Employees International Union (SEIU) and human services groups, such as AARP, that believe it will help preserve essential services. The measure passed in the House 55-3 and was approved unanimously in the Senate Friday (March 2). “This kind of alliance between Republicans and SEIU is very unusual and very promising,” says state Representative Michael Dembrow, the bill’s Democratic sponsor. “From the Republican perspective, they were surprised to hear SEIU advocating for something that could lead to job losses to their members. This is about the viability of the system and coming up with better structure.”

Proponents say the state can reduce agency costs by at least $25 million each year by taking advantage of an influx of retirements and a hiring freeze that have left many agencies with a high number of vacancies. These vacancies allow the state to avoid massive layoffs by creating the opportunity to dramatically restructure a bureaucracy that has gradually become management-heavy over the years. About 8,000 state employees retired last year, the most in a decade.

Gary Meeks, a veteran state administrator who is working with the union and other groups in support of the bill, says flattening the management structure of state government won’t just save money — it might help make the business of government run more smoothly. “If you have fewer people between the line workers and the managers, it is easier not to be confused by instruction from a variety of different intervening levels of management pulling workers in different directions,” he says.

Meeks says that a great deal of flexibility is built into the law to allow for extenuating circumstances. Using an average of 11:1 will allow agencies to allocate managers across their organizations in whatever way makes the most sense, and exceptions are allowed for when a good case can be made. The Oregon Department of Fish and Wildlife, which currently has a ration of 6:1, has only a few people working in some far-flung areas of the state. “There needs to be a manager,” Meeks says. “You’re never going to get to 11:1.” 

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Melissa Maynard

Melissa Maynard oversees the Pew state fiscal health project’s Fiscal 50 online resource, which helps policymakers understand fiscal, economic, and demographic trends affecting their states by tracking tax revenue, reserves, employment rates, Medicaid spending, and other issues important to long-term fiscal health.