A massive crowd of SEIU 721 members gathered today on the steps of the Los Angeles General Medical Center in Boyle Heights to announce the results of a landmark study – “Shining a Light on Contracting Out in Los Angeles County” – exposing how LA County tax dollars are hard at work making the private sector rich, with LA County government rubber-stamping nearly $6.2 billion annually to private firms while not requiring them to pay a living wage.
“LA County is operating a taxpayer-to-private-sector pipeline,” said Raymond Meza, Deputy Chief of Staff at SEIU 721, which published the study. “Our tax dollars are hard at work making the private sector rich – and the problem is growing. More than one out of every ten taxpayer dollars goes straight to private firms that are not required to pay LA County’s own enhanced living wage. It’s a race to the bottom paid for with our taxpayer dollars.”
Since 2022, LA County has approved or extended 1,965 contracts with private firms. Of those, 30 percent operate outside of LA County – and the vast majority of county contractors are not required to pay their employees LA County’s enhanced living wage. While all LA County services are impacted, healthcare and mental health services are hit the hardest.
“Of particular concern is the sharp rise in healthcare expenditures – and the overreliance on registries,” explained Steve Koffroth, Director of Collective Bargaining and Research at SEIU 721. “Take a look at what we’ve seen in just the past five fiscal years. Mental Health Services private contractor spending grew from $827,000 to $25 million. That’s 2,819%. Temporary Nurse Personnel private contractor spending ballooned from $2 million to $81 million. That’s 3,245%. The Department of Health Services increased its nursing registry expenditures from $11 million to $186 million. That’s 1,540%. The Department of Health Services’ usage of outside nursing contractor Full Time Employees grew from 143 to 674. That’s 371%. This odious practice affects clinics and hospitals just like the one right behind us – the Los Angeles General Medical Center. And it’s got to stop!”
In Fiscal Year 2023, LA County paid ten private contractors close to $1 billion for various services rendered. These ten contractors include seven private or non-profit corporations – with USC getting more than $153 million annually.
‘“I want to be clear – none of this is happening on accident,” said Eloy Alvarez, SEIU 721’s Inland Area Regional Director for SEIU 721 who is deeply involved in contract negotiations with LA County. “The numbers reveal just how extensive this manufactured crisis is. As of January of 2024, LA County had an overall job vacancy rate of 18%. Most glaringly, the Department of Human Resources maintained a 31% job vacancy rate overall. And all the while, LA County leadership uses this set-up that they created as justification to outsource the work to private corporations.”
In 2023, of the roughly 5,907 unique contracts held by LA County, the Auditor-Controller performed just 35 reviews – equivalent to 0.59% of all contracts. Only 247 contractors (or 3.5%) of the total number of contract expenditures were subject to LA County’s enhanced living wage. So, the majority of employees providing contracted services did not receive it – and LA County’s enhanced living wage has not been updated for nearly a decade.
“Contracting out jobs is no small thing,” said Simboa Wright, Vice President of SEIU 721. “Every time LA County contracts out a job, they’re really killing the middle class – one job at a time. Every time LA County contracts out a job, it impacts people of color, women and immigrants the most. That’s because government jobs traditionally are the fastest path to the middle-class for these groups. Our tax dollars are at work making private companies rich. We’re here to put a stop to it – and we won’t stop fighting, because when we fight, we win!”
Attendees of today’s press conference reacted especially enthusiastically to remarks made by Cynthia Mitchel, a Registered Nurse at the Los Angeles General Medical Center. She spoke from the heart about the effect that the practice of contracting staff has on employee morale as well as patient safety – and she called LA County management to the carpet for this practice.
“Instead of filling vacancies, they would rather spend millions on contract employees,” said Cynthia Mitchel. “It’s obvious what LA County’s goal is – to continue contracting out. We have even endured comments like, “Los Angeles County should treat employees better.” It is a shame and downright embarrassing to have contract employees coming to our house and telling us these things. We are tired of Los Angeles County contracting out our jobs. We are tired of Los Angeles County looking us in the face and saying, “We care about you.” We are tired of Los Angeles County looking us in the face and saying, “We hear your concerns.” Our patients – our communities – deserve the best care. We deserve the best, safest working conditions possible. They need to invest in us. We have worked through thick and thin. We have worked more than 12 hours on our feet while contract employees get to go home. Enough is enough!”
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Click here to read the landmark study, “Shining a Light on Contracting Out in Los Angeles County” – and click here to view more photos from today’s press conference. To enjoy more audio, video and photos from this event and others, go to our SEIU 721 social media feeds on Facebook, Twitter/X, Instagram, YouTube and BlueSky. Visit our website at www.seiu721.org.
