Agenda - 05-09-2000-3 - Laserfiche WebLink

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2 As background information to the Board's discussion, the following information is provided. Cost of Living Increase Subject to final review of the budget, the Manager plans to recommend a 3.0 percent Cost of Living Increase. This recommendation is based on both cost of living and market factors. - As to cost of living: • Thus past calendar year has seen a higher rate of increase in the cost of living as reflected in the consumer price index than the past two years. For calendar year 1999, the cast of living increased. at a seasonally adjusted annualized rate of 2.7 percent. This increase has continued into 2000 with a rate of 3.7 percent for the 12 months ending March 2000. • Based an the first three months of 2000, the. U.S. Department of Labor's Bureau of Labor Statistics reports the consumer price index is increasing at a seasonally adjusted annualized rate of 5.8 percent. Rising costs for energy (including gasoline), food, housing, as well as costs in most other expenditure categories account for the increase. Housing also has been impacted by the increasing home mortgage cost. . • Attachment 2 shows Orange County Cost of Living Increases over the past 10 years along with increases in the cost of living as reflected in the consumer price index. Given the continuing pace of inflation and the unlikelihood of being able to offset the full impact of a significant increase such as 5.8 percent in a single year, the three percent is recommended to keep County salaries on track with the cost of living. - As to market: • The area labor market continues to be characterized by the lowest unemployment in ,decades. As of February 1995, grange County unemployment was 1.3 percent as compared to 2.4 percent in February 1995. In the Raleigh/Durham/Chapel Hill MSA unemployment in February 2000' stood at 1.8 percent compared to 3.1 percent in February 1995.. • Recruitment continues to be difficult in more technical and specialized areas and far certain business and administrative positions. Examples of such positions include Public Health Nurses, Emergency Management Technician -Paramedics, Telecommunicators, ,CPS Social Workers, Computer/PC support positions, Planners, Budget Analysts and cerkain Administrative Assistants. To fill positions, more salary offers must be made at salaries above Step 1 of the County's salary range. • The charts below show the percentage adjustments to salary structures of area local government pay plans for 1998-99 and 1999-00. This indicates the continuing need for Orange County to maintain its salary structure in relation to the area market.