Public sector still struggling as private-sector jobs come back

The private sector is slowly climbing its back way from the Great Recession, adding 155,000 jobs in December, but the public sector is continuing its long employment slide, making it the worst few years for government employees in recent memory.

That’s a conclusion from a new report by the Nelson A. Rockefeller Institute of Government at the University of Albany, which calculates that while private-sector employment is down 3.1% from its peak in January 2008 and on the rebound, state and local government employment is down 3.4% from its peak in August 2008 and continuing to slide.

State and local governments were slower to shed jobs than the private sector when the recession began -- after all, their revenues, which come in from taxes, do not follow economic trends in real time as revenues from private companies do. But as soon as government jobs started to decline, they fell more consistently and for a longer period of time in this economic crisis than they have in any previous one, the report said.


About 60 months after the 2007 recession, state government employment is down 1.3%, it said. By contrast, state government employment 60 months after the 2001 recession was up 4.3%, and was up 18.3% after the 1973 recession.

That may be because “government jobs” became a much-maligned term after 2010 when a number of tea party candidates were voted into office and vowed to cut government pensions and salaries. The Republican governor of Maine went so far in April of last year to call government workers “about as corrupt as can be.”

The cuts span across states and governments. New York had the largest decline in K-12 education jobs, California cut the most jobs in police protection, and Texas slashed the most in hospitals and corrections, according to the Rockefeller Institute.

Virginia eliminated the arm of its Department of Labor and Industry that enforces wage and hour complaints, meaning workers have to hire a private lawyer if they feel they’ve been cheated out of wages. New Jersey saw such vast cuts to police departments across its various cities that crime is increasing in many. Cuts to local education jobs have crowded classrooms and led to unpaid furloughs in school districts across the country.

The cuts also mean that adult women, who fill two-thirds of public-sector jobs, have a higher unemployment rate than men for the first time since before the recession began.

“The recession caused a historic drop in state revenues, and so states responded by cutting their spending, and to a significantly lesser extent, by raising revenue and drawing on reserves,” said Phil Oliff, an analyst at the Center on Budget and Policy Priorities. “In some states, some policymakers have taken on public employee salaries as part of their political approach.”

State workers who aren’t in education seem to be faring the worst (state education workers are mainly in public colleges and universities, which can raise tuition to make up for budget gaps). State government non-education employment, which makes up more than half of state government jobs, has fallen 6.8% from peak employment in August 2008, an unprecedented and sharp decline, the report said.

Local government education employment was also hit much harder than in previous recessions. It is down 3.8% from peak employment in July 2008. By contrast, it did not decline after the 1973, 1990 and 2001 recessions.

Only states being fueled by an oil boom seem to be able to avoid these drastic cuts, the report said. In Wyoming, state and local government employment is up 9.2% since August 2008, and in Alaska, it’s up 3.8%. By contrast, state and local government employment in Nevada has fallen 10.1% since August 2008, 7.3% in California and 7.4% in Michigan.


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