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Fewer public jobs since Obama took office

July 14, 2011 - Jim Anderson
Economist Robert Shapiro has observed that from December 2007 to July 2009 — the last year of George Bush’s second term and the first six months of Barack Obama’s presidency — private sector employment crashed from 115,574,000 jobs to 107,778,000 jobs.

That’s a loss of nearly 8 million jobs, only a fraction of which have been recovered.

But what of public sector jobs?

It may come as a surprise to many people, but government jobs have actually fallen off by more than 400,000 since President Obama took office.

The decline has come in state and local government.

Outside of the Postal Service, federal government jobs are up 139,300 (or 6.7 percent) under Obama, according to the Bureau of Labor Statistics. (If you take into account the Postal Service, which has seen many cuts, the increase is just 1.4 percent.)

State and local government jobs, meanwhile, are down 556,000, or 2.8 percent.

The “official” end of the Great Recession came in June 2009. Since then, the private sector is up more than a million jobs, while the government sector has lost nearly half a million.

In the government sector, there were 22,557,000 jobs in June 2009, when the sluggish economic recovery began. As of June 2011, there were 22,064,000 government jobs — a net loss of 493,000.

Again, that loss in government jobs has come at the state and local levels — some of it in education — as budgets continue to be squeezed.

Overall, the government sector has 7 percent more workers than it had at the beginning of 2000, when George Bush took office. The private sector has about 1 percent fewer jobs.

Let’s state that again. After a decade of lowered federal tax rates initiated under George Bush, the private jobs market has seen no growth — thanks to the Great Recession. The public sector, which expanded slightly over the past decade, is now shrinking.

Heidi Shierholz of the Economic Policy Institute notes that since June 2009 nearly 50 percent of the private sector job gains in this “recovery” have been canceled out by job losses in the public sector.

Further, she says, if the growth in the working-age population is taken into account, the labor market is now 11 million jobs below the level needed to restore the pre-recession unemployment rate (5 percent in December 2007).

With unemployment at 9.2 percent, some in Washington insist that federal spending must be trimmed.

But writing in The Atlantic, Daniel Indiviglio warns that austerity at the federal level might only make matters worse in the short term.

“If job cuts at the state and local level continue, then that would be bad enough,” he writes. “But if federal cuts also ramp up, then we'll have an even stronger headwind working against the private sector's job growth. Additional spending cuts should be delayed until the labor market has strengthened and job gains have become more consistent.”

Here’s a summary of where the jobs market stands.

The private sector, which represents roughly 80 to 85 percent of available jobs, remains far below the level needed for “full” employment, but is moving up slowly. Private sector jobs, despite rising by more than 2 million since March 2010, are down 1.8 percent since Obama took office.

The public sector, overall, is declining. The bulk of government jobs is at the local level. Of the current 22 million public sector workers, about 14 million are employed by local governments. According to some reports, about 1 million local government jobs may be cut in the year ahead.

With the federal debt rising, our national leadership is at an impasse, fair to say. You can’t raise taxes in a recession, Republicans insist.

In the end, however, the appropriate question may be whether those taxes fund worthwhile jobs.

Arguably, we’ve already seen that federal tax cuts don’t guarantee a boon in private jobs.

 
 

 

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