For more crisp and insightful business and economic news, subscribe to The Daily Upside newsletter. It's completely free and we guarantee you'll learn something new every day.

A couple of extra "Help Wanted" signs aren't going to solve this one.

The current nationwide labor shortage includes 780,000 more unfilled government jobs than before the pandemic, meaning that cities are missing trash pick-ups and mail delivery remains at a glacial pace. As such, local governments are embracing the practice of signing bonuses to lure workers back into schools, post offices, courts, prisons, schools, waste plants, and public transit.

Public Sector Exodus

In Albuquerque, New Mexico, firefighters can collect $15,000 to put on a uniform. Wichita, Kansas is offering $5,000 to 911 call dispatchers who'll take the gig. Meanwhile, in Helena, Montana, school bus drivers are being baited with $4,000 to get on the payroll with the start of school looming.

Despite all of the new incentives, public sector hiring remains a perfect storm of adverse trends:

  • Municipalities saw record retirements last year, especially from in-person jobs like driving trucks and delivering mail. These jobs remain undesirable in an environment of spiking Covid-19 cases and spotty child care services. In some places, mask and vaccine mandates have made hiring even tougher.
  • Cities have sparse excess cash to throw around as both private and public sectors race to fill payrolls. In Albuquerque, where 1 in 10 municipal jobs is empty, only three people attended a recent job fair. Meanwhile, Netflix and Amazon, which recently opened facilities in the area, haven't had trouble staffing.

Mixed Results: In New Orleans, a pay raise for trash collection drivers from $14 to $17/hour quickly led to new hires. Meanwhile, Baltimore, which is short a quarter of the public works employees it needs, bumped drivers' pay 5% to $23/hour, but still didn't see a steady flow of applicants.

Slow-Moving Stimulus: Biden's $350-billion American Rescue Plan has earmarked funds to help municipalities hire and retain essential workers, but the rollout has been messy and funds have been slow to reach local municipal offices.