More States looking at furloughs to cut costs

As they try to cope with gaping budget deficits, at least 15 states from every region — like Alabama and Georgia in the South; Arizona, California and Washington in the West; and Massachusetts, New Hampshire and New York in the Northeast — are in various stages of considering or carrying out furloughs.

But furloughs can be a problem for states in a way they may not be for a private company where demand for a product has dropped. Government services remain in
even greater demand in a weak economy. Furloughs often mean fewer workers handling a larger load. For instance, there are already signs of disability claims piling up in seven states.

The longest state furloughs so far appear to be 24 days in Alabama, the same number that had been proposed in Minnesota.

“The word ‘furlough’ sounds nice and fluffy, like, ‘This isn’t painful, we aren’t doing layoffs,’ ” said Hetty Rosenstein, director of the largest state-worker union in New Jersey. There, an appeals court last week upheld a plan to make state workers take two furlough days by June 30, the end of the fiscal year, and 12 more in the next fiscal year.

“But,” Ms. Rosenstein added, “furloughs are fundamentally a cut in pay. And furloughs are a cut in service. If you don’t have people working, the work isn’t going to magically get done.”

“Furloughs can save you money and help you avoid layoffs, at least initially,” said Alan Ehrenhalt, editor of Governing magazine. “But employees do lose income, services are disrupted, and it turns out you can’t really close all the things on Friday you thought you could. “So the savings aren’t as great. And you’re not solving any long-term problem.”