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Tennessee credits new pay plan with boosting hiring and cutting turnover after award recognition
Summary
An agency official said Tennessee implemented a new statewide compensation philosophy that modernized salary grades, prioritized proficiency and attracted more applicants — reporting a 62% rise in unique applicants, a 56% rise in applications and a 22% drop in turnover.
An agency official speaking on behalf of Tennessee state government said the state’s new compensation philosophy has modernized the executive branch salary structure and improved recruitment and retention, and that the effort was recognized with an award. “We are honored to be recognized by nasby with this year's Eugene H Rooney Jr award,” the official said.
The official described the change as an “operational and cultural shift” designed to attract and retain top talent in a complex labor market. The state updated its salary structure after a statewide compensation study, benchmarking jobs to market ranges and assigning each position a competitive range and salary grade based on individual factors, the speaker said.
The approach allows pay increases tied to technical expertise and proficiency rather than relying solely on tenure or across-the-board raises. “We introduced new approaches like the chance to increase pay for technical expertise and by having salary based on proficiency,” the official said, adding that adjustments followed a compression analysis.
Citing outcomes, the official said the state saw a 62% increase in year-over-year unique applicants, a 56% increase in overall applications and a 22% reduction in turnover, which reduced vacancies and service disruptions. “The recent pay changes have positively impacted our employees, enabling many to achieve their goals and a healthier work life balance,” the official said.
The speaker also said the plan preserved benefits and emphasized the changes were intended as a sustainable long-term strategy rather than a one-time across-the-board raise. The official thanked the governor’s office, the Tennessee General Assembly and the Department of Finance and Administration for their roles in funding and support.
No formal vote or legislative action was recorded in the transcript excerpt provided; the remarks are presented as an agency announcement summarizing reform design, reported outcomes and stakeholder acknowledgements.
