Philadelphia is spending a record amount on overtime as 1 in 5 city jobs sits vacant

Philadelphia is projected to spend a record amount on overtime pay this year — more than a quarter of a billion dollars — as the municipal government grapples with severe understaffing.

According to its estimates, the city will have spent about $258 million of its $6 billion budget on overtime in fiscal year 2023, which ended June 30. That’s a 25% increase over three years ago, when the Pennsylvania Intergovernmental Cooperation Authority (PICA) chided the city for bloated overtime spending and required Mayor Jim Kenney’s administration to draw up a reduction plan.

Since then, the city has seen a mass exodus of workers amid the coronavirus pandemic and the nationwide phenomenon known as “the Great Resignation,” which officials say complicated efforts to control overtime.

In all, nearly 1 in 5 of the city jobs that are budgeted lies vacant, meaning that about 4,600 jobs across the municipal government are empty. Remaining employees have logged a staggering level of overtime, in part to make up for lost work.

The increases in overtime were heavily driven by claims from the Police, Prisons, and Fire Departments, according to a new report released by PICA. The Kenney administration contends that increased overtime costs are largely offset by reduced salary expenses from the high number of vacancies — although some departments, such as the Fire Department, have seen hiring rates improve even as overtime claims increased.

“The departments that are driving some of the vacancies are also the departments that are driving the overtime,” the city’s chief administrative officer, Stephanie Tipton, said in an interview. “There may be other things at play, but absent us being able to fill the roles, we have to provide the service.”

» READ MORE: How short staffing across Philadelphia city government affects you

About 70% of the overall overtime spending went to the Police and Fire Departments, which is not unexpected given that they are two of the largest agencies in the city, together employing more than 9,000 workers.

What’s new is that police overtime last fiscal year exceeded $100 million, a 36% increase over the previous fiscal year. The spending came as the force was short hundreds of officers while grappling with a persistent gun violence crisis.

The shortages aren’t limited to the Police Department — or Philadelphia.

Staffing rates have stabilized across the private sector over the last year nationwide, but state and local governments have not rebounded in the same way. Data collected last month by the Bureau of Labor Statistics show that every major industry has recovered to pre-pandemic staffing levels — except hospitality and government.

“There is a broader cultural trend in decline in trust in government institutions,” said Andrew Erdmann, a partner at McKinsey & Co. who consults governments on recruiting and hiring. “Perhaps we can infer that the desire to be employed in them has also gone down.”

City officials say that attrition is slowing and that they’re trying a number of strategies to attract applicants, including an aggressive marketing campaign.

City Council and Kenney’s administration added $10 million to the budget for the upcoming year for hiring bonuses and $5 million more for workforce development. The city also budgeted for new perks such as expanding parental leave from four to six weeks, and free public transit vouchers for city employees.

» READ MORE: 5 ways Philadelphia can address its short-staffing problem

But PICA Executive Director Harvey Rice said the oversight board remains “concerned” about what it considers to be perennially high overtime costs, especially because federal stimulus dollars will be exhausted next year. While there’s a relationship between understaffing and overtime spending in some departments, he said, that’s not necessarily the case across the government.

“Next year and going forward, we’re going to take a harder look, especially if those positions start getting filled and yet you see overtime continue to grow,” Rice said. “We’re not going to allow them to keep giving us the same story about staffing levels.”

The Police Department has historically spent comparatively high amounts on overtime, largely due to court appearances and unplanned events such as protests that require security or traffic closures.

This year, staffing levels and overtime appear closely linked, and the staffing picture could get worse before it gets better.

As of March, about 6,400 positions were filled out of about 7,300 budgeted. That’s fewer people than the department employed at the same time last year, when police brass were raising alarm over high attrition and a mass shortage of officers.

Facing a nationwide shortage of police recruits, the department can’t hire as quickly as other agencies, given its structure. Cadets are required to pass a battery of tests, then attend the academy for nine months before they can hit the streets.

And the force can’t fill positions as quickly as officers are leaving. More than 800 police employees are currently enrolled in the Deferred Retirement Option Plan (DROP), according to PICA, meaning they intend to retire within the next four years. Police Department employees, both officers and civilians, make up 42% of all DROP enrollees — despite making up just 28% of the city workforce.

» READ MORE: The Philly Police Department is short officers. Here’s why the situation is about to get worse.

Still, a disproportionate share of overtime went to a small number of officers.

While homicide detectives have traditionally topped overtime claims, last year, only about half of 66 officers who claimed more than $100,000 in overtime had obtained detective rank.

One patrol officer in the 39th District logged nearly $164,000 last year in overtime alone, allowing him to earn more than $275,000 — almost as much as Police Commissioner Danielle Outlaw’s salary.

Many of the department’s top earners sought reimbursable overtime — an arrangement in which private employers pay back the city for deploying officers to stores and other locations after their normal work schedule. Demand for private security has soared along with an uptick in retail theft.

The top overtime claimant in the department was a patrol officer in the 19th district who logged nearly $200,000 in overtime on top of his $83,000 base salary. Most of that sum came from 2,400 hours of work that was reimbursed by private companies — that’s the equivalent of working 46 hours a week, every week, for outside companies on top of his day job.

A relatively small unit also topped the list.

Four of the top 20 police officers with high overtime claims were assigned to the Philadelphia Police Department’s Center City District, a 43-member unit operating out of a substation inside the headquarters of the economic development agency that bears the same name — a vestige of an early 1990s plan to add more security downtown. It is not affiliated with Center City’s 6th and 9th Districts.

The four officers each claimed more than $100,000 in overtime through upward of 2,000 hours worth of reimbursed work, allowing them each to log gross compensation in excess of $200,000.

Several of the city employees who drew the most overtime last year were paramedics in the Fire Department, including one who logged $185,000 in overtime atop a $91,000 base salary last year.

The Fire Department spent the second-most of any city agency on overtime — nearly $73 million. That amount is roughly in line with what the department was allocated to spend on overtime, but comes as the Fire Department’s staffing has somewhat improved.

While about 14% of its full-time positions are vacant, that’s down from 20% last year. Its vacancy rate can be attributed in part to the department adding more than 600 new jobs since 2020.

Fire Commissioner Adam Thiel noted that the Philadelphia Fire Department was among the busiest departments in the nation both for fire and EMT calls, adding that the vacancy rate didn’t capture the full picture because it included cadets still in training.

“We are not at full staffing,” Thiel said during an interview in late March. “Our issue is throughput and our training academy. … We only have so many showers, we only have so many lockers.”

Mike Bresnan, president of the International Association of Fire Fighters Local 22, which represents firefighters, EMTs, and paramedics, said overtime rates can be attributed to a nationwide shortage of paramedics. In many cases, he said, firefighters who are cross-trained as EMTs are filling in.

Bresnan and Thiel also both pointed to mandated minimum firehouse staffing levels as a factor. Because each fire company is required to have an officer and several firefighters on the clock at any given time, overtime is used to fill slots when someone is sick or on vacation. Bresnan said the union and the department hope the city one day funds a reserve of firefighters who can fill in citywide.

“Then a lot of these problems go away,” Bresnan said, “the exorbitant overtime, people working long hours, and long days.”

But, much like the police, overtime was not distributed evenly. About 56 Fire Department staffers logged six figures in overtime. One Engine 37 firefighter claimed $175,000 on top of a base salary of $83,000, pulling in about $40,000 more than Thiel last year.

Thiel defended high-earning staff, but acknowledged that dozens of firefighters and EMTs logging 80-hour weeks is concerning.

“Those are the folks that are consistently showing up, willing to be away from their families. They’re stepping up to do that work so others can take their earned time off,” Thiel said. “But it’s absolutely not sustainable.”

Other agencies are expanding the length of some shifts to account for vacancies, including the Prisons Department, which has a 36% vacancy rate — the highest of any department.

The city’s jails have over the last several years seen a mass exodus of correctional officers amid what many have described as chaos in the prisons. Union officials have cited short-staffing and unmanned units when asked why two inmates — including one charged with four murders — were able to escape earlier this year.

» READ MORE: Panic attacks and 20-hour workdays: Why Philly correctional officers are quitting in droves

The department has offered hiring bonuses and other perks to attract new guards, but has not been able to make up for the wave of retirements and resignations.

Even before the shortages, the department spent a high amount on overtime compared with other agencies. City officials accounted for that in the budgeting process, so while the Prisons Department spent $34.5 million on overtime — a 15% increase over last year — that only slightly exceeded its budget.

Short-staffing remains a problem in other key departments, including in the Managing Director’s Office, which over the last two years has expanded its antiviolence and opioid-response initiatives but today has about a quarter of its budgeted positions unfilled. The department is small and spends a relatively tiny amount on overtime: a projected $1.2 million this year.

While staffing has complicated service delivery and budgeting in many departments, there are notable exceptions.

The biggest is the Streets Department, one of the city’s largest and most visible agencies. Streets is among five departments that was projected to have no vacancies by the end of the fiscal year. Overtime spending was roughly in line with what the department was allocated.

In other cases, high levels of overtime didn’t appear linked to short-staffing.

An airport custodian supervisor reported $137,000 in overtime on top of a base salary of $52,000 last year. Payroll records show the city employed about the same number of custodial supervisors in 2022 as it did in 2019 — before the pandemic.