The Association of Employers in Iceland held an open meeting on February 9th, 2023, where a report made by Intellecon, entitled "Isn't it best to work for the state?" was discussed. Since then discussions regarding overstaffing in the public sector, increased labor costs which public institutions are battling due to number of employees, and whether public employees enjoy too much legal protection in their work has been rampant in Icelandic society.
Media outlets have been riddled with articles and interviews regarding the statistics the report gives, and whether the report is justified.
But in all of this, it has been omitted to point out that the report is not tackling a problem, but only a possible manifestation of a problem.
Let's identify this manifestation.
Each organization's needs are different
Although it seems easy to divide the labor market into two separate markets, the public and private market, the division in of itself is unfortunately not that simple.
Further dividing the public market into state and local authorities is also not accurate enough, as each institution individually has different needs. If municipalities are taken as an example, then it is not possible to assess the staffing needs of the finance department on an equal basis with kindergartens. In the same way, it must be pointed out that it is not possible to assess the staffing needs of country preschools on an equal basis with preschools in the capital area. Each establishment must be evaluated individually.
Kindergarten staffing is not determined by any economic decisions, but only by need at any given time: How many children need kindergarten space, and how many employees are needed to care for the children properly. For a locality with low population growth and a high average age, the need for kindergarten staffing is lower than in a locality with a high population growth and a lower average age. For example, lack of staff in preschools in the capital region of Iceland has been at the top of the discussion for many years, are those establishments exempt from the results of aforementioned report?
Similarly, it is easy to look at other public institutions, e.g. hospital or fire department. Those institutions are staffed based on a shift system; the system is set up so that employees make the most of shift incentives, which increase their wages, but all shifts are staffed to reduce possible overtime, which lowers labor costs as well as work load. The number of people per shift is determined based on statistics related to calls, the number of patients, minimum staffing according to collective agreements, or known minimal staffing needs defined in union agreements that have been proven to be necessary to fully staff each shift. Poorly organized shifts increase labor costs for a number of reasons, one of which is precisely the high workload that drives staff into possible burnout, which results in higher labor costs due to more paid overtime and sick pay.
Office work cannot be planned based on as exact statistical information, there it is more important to have qualified managers who have a good overview of the workplace and project status there, managers who have organized the organization and the job descriptions of each person in an efficient and cost-effective way.
It should be noted that in none of the aforementioned examples are salaries or benefits discussed as a sole reason, but focus will be put on workplace conditions.
And that's the underlying problem that isn't being discussed by the report.
If a manager of an organization is incompetent in their job, it doesn't matter how many employees the organization has on their payroll.
So what is the problem?
When discussing problems related to personnel, the responsibility for the problem and its solution always lies with management. Managers are responsible for ensuring that the establishments that report to them are properly staffed, that there is neither understaffing nor overstaffing. Managers are also responsible for correctly designing job descriptions so that all jobs are of the best use for the organization, manning shifts so that the hours worked by each individual effectively benefits both the employer and employees in the most efficient way, as well as making sure that all the aforementioned things work together as best as possible to reduce all costs for the organization. Managers are also responsible for organizing the work of their team in such a way that the work is of the best use to the whole, and in the public sector managers also have to organize all the work of their organization so that it is of the greatest use to it's citizens.
A manager who is unable to carry out these duties is considered unfit for their duties, and should not perform duties that involve human supervision in any capacity. This is the main problem of the public sector, incompetent managers who are unable to make cost-effective and efficient decisions for their organizations.
Incompetent managers in the public sector
The main problem of the public sector is therefore not tackled in the report but only possible manifestations, which by no means apply to all institutions.
Are some organizations overstaffed? Yes, if the manager of that organization does not have an overall view of the work of their organization, they will be unable to tailor the work flow within the organization and the job descriptions of individual employees so that the work of each one is of the best benefit to the organization.
Are any organizations understaffed? Yes, if the manager of that organization does not have the skills to plan and staff shifts according to the information provided.
Are labor costs out of control? Yes, if the manager is incapable of assessing staffing needs and is hiring too many people to perform unnecessary jobs, or if the manager hires too few people and runs up the aforementioned costs related to staffing at the establishment.
How do we deal with the problem?
By tackling incompetent managers!
Managers in the public sector are often not hired, but elected. These are individuals who often have little or no knowledge of the issues they are dealing with in their organization when it comes to human resources.
The solution there is simple: Elected persons should never perform duties that involve human supervision, reshuffling organizational units, setting up shifts, or anything related to human resources in any way.
Another thing that is unfortunately known in the public sector is nepotism. The fact is that many public sector jobs are filled by people who are in the right party, know the right people, or are beholden to the right people.
The solution here is more difficult, but one idea would be for the public sector to outsource all managerial recruitment to an independent, third party that operates entirely without any intervention from public sector managers. Since Iceland is a small country, and everyone is related to everyone, this is difficult, but setting up an impartial process should be a priority in order to greatly strengthen the institutions of the public sector.
Competent managers are the key to both lower operating and labor costs in the public sector.
In conclusion
When discussing public employees, care must always be taken to distinguish between general employees and managers. Much of what can be done better is being blamed on general staff who have no control over the situation. It is important to always look at the managers and assess how they can be better recruited, as well as the job descriptions of elected representatives who have no expertise when it comes to their organization, let alone the necessary skills to handle human resources and the organizational structure of the organization.
In the same way, it needs to be well thought out before the rights of civil servants are changed. Ample legal protection at work for general public sector employees is important as they are employees who are, due to the political nature of their workplace, often subjugated to incompetent managers and related problems: poorly set up and staffed shifts, understaffing, disorganization, and often general anarchy in the somehow still rigid burocracy.
Public employees fight many and complex battles within the walls of their organization on a daily basis, which the public does not hear about. A fight that often costs them reprimands, warnings, and possible termination. The public employees engage in these fights to demand better services for the public when the manager does not have enough knowledge to assess the need for services, or the skills to understand what approach the public needs from the organization.
It is time that the public general staff stop taking the blame for what is wrong with the public sector. High salary costs, poorly organized activities, the amount of time it takes to resolve cases, and difficulties with services are not due to public sector's general employees.
The shame lies entirely with incompetent managers.
Article first appeared as a review on visir.is 20.02.2023 [link].