Bureaucratic Entropy in Thunder Bay

There are constant comments in Thunder Bay that there are too many municipal workers and that the numbers have grown faster than the city itself.  In a 1979 article in the Urban Affairs Quarterly titled “Economy of Scale or Bureaucratic Entropy? Implications for Metropolitan Governmental Reorganization”, Hutcheson and Prather examine the relationship between the number of city employees and city population.  This study was done given the fashion of the time to implement metropolitan and regional city governments that consolidated jurisdictions that often was justified by the argument that more efficiency and economy in service delivery would result.  According to the authors:

“If efficiency can be defined as serving more residents with fewer employees, economies of scale might be demonstrated by a relative decrease in the size of bureaucracies as city size increases.” (Hutcheson & Prather, 167).

However, the authors find that not to be the case.  Increases in the number of employees appear to have outstripped the growth in population in the wake of amalgamations and metropolitan reforms.  The new institutions appear to have generated a dynamic in which has resulted in less rather than more efficiency.  They call this bureaucratic entropy.  Essentially, the new institutions create a kind of disorder, which decreases the efficiency with which manpower is converted into service outputs.  Or as they write:

“Or more simply put, it could be easier to ‘goldbrick’ in a larger bureaucracy.  Thus increasing city size may mean proportionately larger bureacracies, and perhaps diseconomies of scale.” (Hutcheson & Prather, 168).

Well, it would appear that bureaucratic entropy is alive and well in Thunder Bay at the municipal level.  The accompanying figure shows full-time equivalent employment numbers for the City of Thunder Bay for the period 2001 to 2011.  In 2001, FTE employment was 1,632.0 whereas by 2011 it had risen by 25 percent to reach 2032.7 (my estimate based on the 2012 operating budget breakdown).  Over the same period, the CMA population of Thunder Bay went from 121,986 to 121,597 – essentially, a stable population.

So is this bureaucratic entropy?  Did the creation of monopoly municipal government at the Lakehead after amalgamation in the place of the former competitive municipal structure of twin cities put in place a bureaucratic structure that does not keep costs in check?  That may be part of the explanation.  Another explanation lies in the mix of city services, the demand for new services as well as changes in their quality.  Municipal governments are expected to do more than they did in 1970 particularly in the areas of health and environment. Tied to all of this is the fact that in Ontario, municipalities are creatures of the provinces and there is often the downloading of functions that necessitate new employment.

A better question is the following.  Has municipal employment in Thunder Bay been growing faster than Canada as a whole?  Compare the following – from 2001 to 2011, municipal employment in Thunder Bay grows by 25 percent while population remains stable.  For Canada as a whole during this period, the number of municipal employees grew by 24 percent but population grew by 11 percent.  While municipal employment in Canada has been growing faster than population – perhaps an indicator of some bureaucratic entropy – the growth is more pronounced in Thunder Bay.