State and Local Government Job Growth Lags Behind Private Sector
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City and county payrolls are down more than 5% from pre-pandemic totals, excluding education positions, according to a report.
More than a year after the largest monthly decline in state and local government employment on record, job growth in the public sector is lagging as the economy recovers from the pandemic-induced recession, according to the Pew Charitable Trusts. Although the private sector and hard-hit public school systems are seeing an increase in employment, job growth in state and local government outside of schools is not, Pew’s research shows.
As of August, the report states that local public payrolls were down 5.3% from pre-pandemic totals, or more than 350,000 jobs, excluding education positions. After weathering the early months of the pandemic with relatively small losses, state government employment—also excluding education—has declined slowly every month this year, with the total down 2.1% from pre-pandemic levels, or about 57,000 jobs.
Some of the factors contributing to the hold back of government jobs recovery includes:
- Temporary layoffs as many cities and states are still ramping up services that were scaled back to prevent the spread of Covid-19.
- Budget pressures that led to hiring freezes or furloughs earlier in the pandemic remain in place in some jurisdictions.
- More workers are leaving government jobs, including retirements, causing managers to scramble to hire for hard-to-fill positions.
According to the report, the lagging recovery of state and local jobs matters beyond the bank accounts of those previously on the public payroll. Reduced public employment—if it persists over a lengthy recovery—could harm government services and hinder broader economic growth.
As of July, the most recent month of data available on a state-by-state basis, there were fewer noneducation workers in state and local government than in July 2019, except in Rhode Island, South Dakota, Texas and West Virginia, according to Pew calculations of U.S. Labor Department estimates.
Selected categories experiencing large year-over-year declines since the pandemic’s start are:
- Casino hotels, down 22.6%.
- Amusements, hotels and recreation, down 22.5%.
- Museums, historical sites, zoos and parks, down 15.3%.
- Information (including libraries), down 11.2%.
- Transit and ground passenger transportation, down 5.1%.
- Executive and legislative offices, combined down 4.5%.
- Administration of environmental programs, down 4.2%.
- Correctional institutions, down 3.7%.
The report contends that a major reason that public sector employment hasn’t rebounded at the same pace as in the private sector is that many workers furloughed or laid off temporarily have not returned to work because of pandemic-related service reductions.
While the nationwide number of workers who were temporarily laid off has declined sharply, permanent job losses remain stubbornly high—about 3.5 million. The permanent job loss category covers people who don't have a job to return to and need to find a new one when the economy reopens completely.
The U.S. Bureau of Labor Statistics projects a 0.7% annual growth for private and public employment from 2020 to 2030. This projected growth is faster than recent projections, because it reflects both the recovery from the 2020 recession and low-base-year employment for 2020 associated with the Covid-19 pandemic, according to the agency.
For more information from the Pew report click here.
Andre Claudio is an assistant editor at Route Fifty.
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