Sure. But healthcare is most likely driving their comp costs more than pocket wages. Healthcare is what's driving state/local government costs because of the high head count of middle class professions. Salaries might go up by 2-4% depending on the collective bargaining agreement with the union, healthcare will go up by 15%.
Basically, states and local governments aren't operating with a macro worldview of the whole economy, they're trying to balance their own budget. They're going to eat it on healthcare, pay as small a COL raise as they can get the public employee unions to accept (pretty small actually), and lay off employees on the stupid last-in-first-out basis that the unions insist on. Decision makers at the state level are just trying to get through the year.
The funny thing is that a liberal can look at those ballooning healthcare costs (biggest $ item in the deltas year-over-year) and see it as a private sector screwup, while a conservative can look at the total costs going up and see it as public bloat.
Basically, states and local governments aren't operating with a macro worldview of the whole economy, they're trying to balance their own budget. They're going to eat it on healthcare, pay as small a COL raise as they can get the public employee unions to accept (pretty small actually), and lay off employees on the stupid last-in-first-out basis that the unions insist on. Decision makers at the state level are just trying to get through the year.
The funny thing is that a liberal can look at those ballooning healthcare costs (biggest $ item in the deltas year-over-year) and see it as a private sector screwup, while a conservative can look at the total costs going up and see it as public bloat.