Wednesday, September 26, 2012

Falling Government Employment Offsetting Private Job Growth

Since the start of the great recession in 2008 the government employments recover has not followed the same upward and leading trajectory as in past recessions.  One of the reasons that the current employment numbers are so discouraging is because of the impact of government employment on the economy.  Government employment continues to fall even has private sector employment rises at rates are back to their pre-recession rates of increase. (Note: The overall number of private employees is still below where it should be, but the rate of growth is comparable.).  

This continuing decline in government employment is particularly disturbing because, unlike private employment, government hiring is entirely under the political control of state and federal politicians.  It is federal, state and local government policies that are hindering public sector jobs recovery, which is hurting the overall economy.  

The two graphs below were created from data at the Bureau of Labor Statistics.  They represent, in thousands, the number of people employed in the private and government sectors each June from 2002 to the present.  The first vertical line in the graph represents approximately  the start of the great recession. The second line in the Government Employment chart represents the approximate end of the Obama stimulus package for state and local governments.  States with austerity budgets and public sector job losses are continuing to experience the most economic difficulty. 
Prepared by: Brian T. Lynch, MSW

When reporting monthly employment numbers the mainstream media seldom mentions the role declining government employment has on the overall employment picture and the economy.  Given the fact that government employment is under substantially more political than private sector employment, the previously uncharacteristic rate of decline in an election season is suspicious and particularly troubling.  More attention should be paid to this phenomenon. 

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