2018 Utility Staffing Survey Results – Part I

For the past few months, I’ve been conducting the 2018 Utility Staffing Survey. This survey has become a biennial survey, alternating years with the Utility Fee Survey. The initial Utility Staffing Survey was in 2016 and, for sake of comparison, here are the results from that survey:

This is the first of two Utility Information Pipeline issues publishing the results of the 2018 Utility Staffing Survey. This issue will examine demographics of the survey respondents, staffing levels, and factors outside the control of the utilities. The next issue will examine staffing levels and practices each utility can control, such as such as payment processing and bill printing.

Demographics of survey respondents

82 utilities, representing 20 states,ranging in size from 134 to 90,000 active accounts participated in the survey. Click on the links below to see charts of the various demographic data for the survey respondents:

Number of responses by state

Size of utilities responding

Size of utilities under 20,000 accounts responding

Types of utilities responding

Services provided by responding utilities

Accounts per employee

To arrive at an accurate index to compare utilities of differing sizes and billing frequencies, I came up with the number of accounts billed annually per employee. This formula multiplied the number of active accounts by the number of times each account is billed annually (12 for monthly billing, 6 for bi-monthly billing, 4 for quarterly billing, and 3 for three times a year billing) then divided that product by the total number of office employees. The higher the result, the more efficient the office should be.

The results ranged from 300 to 46,957 as represented by the graph below (clicking on any of the graphs will open a larger image in a new window).

One disclaimer applies. Two of the top five most efficient offices are local governments where payments are taken in a different department, so their staffing numbers do not include cashiers.

Annual customer turnover

I wondered if the turnover in customers would be a factor in how efficiently offices are staffed, so the survey asked how many applications for service (including routine move in/move outs and new construction) each utility processes per year.

Some utilities billing only property owners, and those will have a much lower turnover rate than utilities billing tenants.

Not surprisingly, the annual turnover rates ranged widely, from .05% to 45.63%. On the low end is a utility in a predominately rural area that only bills property owners. On the high end is a city with a large military installation nearby that bills tenants.

This year, unlike two years ago, there is a slight correlation between annual turnover rates and office efficiency. Of the 15 most efficiently staffed utilities, only four of them have annual turnover rates over 10% and only one of those is over 15%.

Major services billed

The final variable I examined for this issue was major services billed (water, sewer, electric and natural gas) looking for a correlation between the number of services billed and office staffing. I only considered the major services, because other services, such as garbage, stormwater, or area lights, generally are billed as flat-rate services and are not nearly as labor intensive to bill.

As was the case in 2016, utilities billing multiple metered services require more staff than those billing for only a single metered service. This was even more convincing this year, as 31 of the 32 most efficient offices bill for only one metered service, as shown below. The one anomaly also happens to be one of the utilities mentioned above that doesn’t collect payments.

Next issue

The next issue will analyze staffing levels and labor saving practices each utility can control, such as automation and outsourcing.

Is your office adequately staffed?

If you think your utility is understaffed or could operate more efficiently, please give me a call at 919-232-2320 or e-mail me at gsanders@logicssolutions.com to learn how a business review could help you determine this.


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© 2018 Gary Sanders

Do you separate your base charge…?

If your utility is like most, your rates include a base (fixed) charge in addition to the usage charge. The base charge, sometimes called an administrative fee, should generate enough revenue to cover the fixed costs associated with operating your utility. This includes things like the customer’s meter, the infrastructure necessary to provide service to the customer’s location, and reading the meter each billing period. Some water utilities charge different base charges according to the size of the meter under the premise that a larger meter costs the utility more to provide and maintain, both for the meter and the infrastructure to supply water to the meter.

Conversation with a customer

I’ve recently had a conversation with a customer who is considering separating the base charge from the usage component of his city’s water and sewer rates. There are pros and cons to doing this, so this issue will examine those.

Benefits of separating the base charge

The biggest advantage of breaking out the base charge from the usage charge is transparency for your customers. Showing each as a separate line on the bill more clearly communicates to your customers what they are being charged.

A second advantage of separating the base charge from the usage charge is it’s easier for your customers to see the impact of increased or decreased usage on their bill. This is especially true if you institute water conservation rates in times of drought and even more important if you have increasing block rates, so that your customers see the impact of their water consumption. If you’ve recently switched to increasing block rates and haven’t reevaluated how you bill for multiple units, you might want to read this.

The third advantage of splitting the charges is it’s now much easier to track the revenue generated from each component of your rate. Rather than seeing one combined total on billing registers and reports, you will now see separate totals for each.

Disadvantages of separating the base charge

The disadvantage to separating the base charge from the usage charge is customer education. This can be mitigated if you publicize the transition well enough but, in spite of your best efforts at educating your customers, some won’t realize the change is happening until they receive their first bill with the charges separated.

Several years ago, a customer that provides both water and sewer decided to break out the base charge from the usage charge for both services. This meant their customers went from receiving a bill with two line items – water and sewer – to a bill with four line items – water base charge, water usage, sewer base charge, and sewer usage. They didn’t publicize the change well and, needless to say, their phones rang off the hook. Customers, mistakenly thinking they were being charged for additional services, were irate. They ended up paying bonuses to their customer service representatives because of all the verbal abuse they took from customers!

So the moral of the story is, if you decide to do this, publicize it as much as you can well in advance!

Final week for the Utility Staffing Survey!

The 2018 Utility Staffing Survey will be closing on April 15 at midnight, so if you haven’t yet participated, this week is your last opportunity to do so. To complete the survey, please click here. This should take less than five minutes to complete. The results will be published in the next two Utility Information Pipelines.

Please feel free to share this survey with your peers at other utilities.

Thank you in advance for taking the time to complete the survey and for sharing it with other utilities.

Are your policies up-to-date?

If you are considering changing your rates or otherwise need help deciding how to best present information to your customers, please give me a call at 919-232-2320 or e-mail me at gsanders@logicssolutions.com to learn how a business review could help your utility.

Click here to subscribe to my free, bi-weekly email newsletter...

© 2018 Gary Sanders