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Alaska’s job vacancies ties up millions in funds, lawmaker says

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(The Center Square) – Alaska is having difficulty attracting employees, and state government is not immune, according to information presented to the state House Finance Committee on Monday.

Rep. Julie Coulombe, R-Anchorage, proposed a budget amendment that would return $44 million to the state budget currently set aside for staff vacancies. That’s just about half of the $89 million that affects the state’s unrestricted general fund, she said. The overall cost across all funds is over $200 million, according to information presented to the committee.

The amendment would allow departments to choose where they want to make cuts.

“It would help departments zero in on exactly what they really need so we know exactly how much overtime is happened,” Coulombe said. “If it’s not overtime, again, if they have to come back and say ‘we need this,’ it puts us on a path for more transparency.”

The Department of Corrections, with 2,145 vacant budgeted positions, would lose the most, almost $11.5 million, according to the information provided by the Legislative Finance Division. Other lawmakers questioned how that would affect the department.

Alexei Painter, director of the Legislative Finance Division, said vacancies are often filled with overtime paid at time and a half or twice the regular rate.

“For example, in FY 2024, they have their actually projected expenditures on the personal services line are $15 million more than they are budgeted because of that overtime,” Painter said. “So while there’s savings from the positions being vacant, they have to make it up at a higher cost in those cases.”

The money from vacant positions has gone into the state’s constitutional budget reserves, according to Painter.

The amendment failed 6 to 5.

State government is not the only sector facing a shortage of workers. Last week, the Department of Workforce and Labor Development announced Workforce 2030, a plan to address the state’s more than 10,000 unfilled jobs. The plan is a partnership between the state and the Alaska Safety Alliance with the support of the Denali Commission.

“Alaska’s 11-year streak of net migration losses is the longest in state history,” according to the department. “Alaska’s workforce participation rates decreased from 67% to 65%. Working age residents (18-64) declined over the past decade by 30,000, from 479,000.”

The plan’s goals include building more talent pipelines for jobs high in demand and reducing the number of people leaving the state.

“Alaska is on the verge of a new period of economic growth, we want to ensure that the State of Alaska is positioned to work alongside industry to capitalize on this new period of growth,” Gov. Mike Dunleavy said.

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