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Study: Furloughs cost Calif. money

October 15, 2009 12:00:00 AM PDT
A study raises serious questions about the furloughs Governor Schwarzenegger imposed on state workers to help close a budget deficit. Researchers say the furloughs could actually be costing California money.The University of California Berkeley Center for Labor Research and Education looked at the short-term savings from furloughing state workers three days a month, then took into account the federal dollars lost, fewer taxes collected and pension debt pushed off into the future.

The study found cash-strapped California is only saving 37 cents for every dollar it cuts out of state worker wages and benefits, and that number drops in future years.

"If the goal of the furlough program is savings to the general fund, I think our conclusion is quite clear: this program is poorly designed," said Ken Jacobs, Center for Labor and Research Education.

The center does receive some of its funding from pro-labor groups, but researchers insist that played no part in their findings because the numbers came straight from the state.

"There's nothing here to balance either way," said Jacobs. "This is pretty straightforward math."

The Schwarzenegger administration disputes the calculations. Aides say three unpaid days a month through June help save $2 billion from the general and special funds.

"We're saving hundreds of millions of dollars in this budget by doing the furloughs," said Aaron McLear, Governor Schwarzenegger's press secretary. "We understand how difficult it is. It's not something we would like to do. State workers should not be shielded from economic realities that everybody else in the state is facing."

Three furlough days amounts to roughly a 14 percent pay cut, which is equivalent to seven weeks of pay.

State workers think they're suffering needlessly if the savings are minimal in the long run. Some are behind in bills and have received foreclosure notices.

Clayton Brown, a Caltrans equipment operator, pulled his daughter out of college.

"I had to tell her 'No more,'" said Brown. "So she's sitting at home. Nothing to do. No money. Hardest thing I ever did in my life. "

The study contends the state would save just as much money by furloughing workers just one day a month, instead of three, because those second and third days off cause too much chaos, which disrupts productivity.

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