It irks me to hear Democratic officials hail “private sector jobs numbers” or the “rebound in the private sector,” as if there are somehow two economies out there, and the amount of jobs up or down in the one where governments happen to sign the paychecks somehow has no bearing on the other. When cops and firefighters and teachers and nurses lose their jobs, they lose purchasing power. They lose the ability to hire private contractors or visit private businesses for the purchase of goods and services. Public employees don’t use a different currency or a different set of businesses. You cannot divorce them from the private sector.
And writing the public sector out of the equation like this really obscures the incredible nature of the depression in public sector jobs over the past few years. While looking for something else, I found this chart from Calculated Risk (click to enlarge):
The chart looks at public sector payrolls from 1973 to the present. As you can see, in the 35 years between 1973 and 2008, the public sector lost jobs only three times: twice during the recession of 1981-82, and then a small loss in 2003. Not only that, but the public sector routinely adds 200,000 or more to the payrolls every single year. In boom years that number can reach up to 500,000, as it did in 2001 (in the midst of a slight recession, mind you).
Now look at the last three years of the chart. From 2009-2011 the public sector has fallen every year. That’s completely unprecedented in generations. Even in 2011, when the private sector had its best year from a jobs standpoint since 2005, the public sector had a horrific time of it, losing more jobs than any year since 1981.
This is extremely abnormal. And it’s not likely to change – notice that the forecast in this chart is for a net loss of 100,000 more public sector jobs in 2012. That’s certainly an improvement over 2010 and 2011, but a catastrophic loss in historical terms, which would also be a record dating back to the 1981-82 period if it weren’t for the Great Recession years prior.
So what does this say? First of all, looking at the public sector numbers for themselves and not as part of trends obscures a lot. I took a little heat in my story on domestic policy in 2011 by citing Scott Lilly’s work showing that 2011 budget cuts cost 370,000 jobs. But the public sector only lost 280,000 jobs overall in 2011, so how can this be? Well, if you look at trend growth in the public sector, which is entirely natural because the population keeps growing, and the public sector must grow with it to provide the same level of public services, then you see 2011 as a year where the public sector dipped close to a half a million jobs below trend. And the same for 2010. So federal cutbacks, and the ripple effects they had across the public sector, could easily have accounted for that loss of jobs. And while an increase of 2,000 jobs among federal employees in December 2011 is good news, when the trend is for an average of close to 20,000 new public-sector jobs every month, that’s a cold comfort.
The public sector depression is also caused by the collapse of state revenue, and the cutbacks that resulted. Some of that will go away in 2012 as revenue gets rebuilt, but not all of it; Jerry Brown’s proposed budget in California calls for a permanent reduction of 3,000 state jobs. But the federal government has done very little to make up for the cyclical spending patterns of the states, by providing fiscal aid. Since the EduJobs bill in 2010, which only made up for a small portion of the state fiscal aid in the stimulus, nothing has moved. A state fiscal aid package that was part of the American Jobs Act stalled in the Senate.
We have never seen anything like this before, an expected fourth year in a row of public sector job losses. You can add to that a two-year wage freeze, at least among the two million-strong federal work force. The President will try to end this with a paltry 0.5% wage increase for Fiscal Year 2013, one that would actually save more money below the current spending cap, coming right out of the hide of the federal employee. Republicans want to pay for the payroll tax cut by extending that federal employee wage freeze another three years.
This is a horror show for the public worker. You have no job security, no raise to match the cost of living, and no real prospects for a comeback. And this of course has a massive impact, not only on the economy as a whole, since the public sector is a heavy chunk of the overall labor force, but on the people who rely on public services, which simply aren’t delivered in the same manner with this decimation in the work force.
And yet these workers, millions of them, have been consistently written out of the American story for the past few years. It’s because adding their statistics into the equation would be inconvenient for those defending the recent economic record. It’s because Democrats in Washington have swallowed the conservative argument that government doesn’t create jobs. It’s because nobody in power wants to blow the whistle on the devastating consequences of austerity, not only in Europe but right here in America. And so this invisible depression goes on, with the public worker not only humiliated, forced to accept, in many cases, the loss of their job security and wage bump and pension and collective bargaining rights, but forced to accept their own cancellation.




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Just how many different lies can I find in that sentence? “private sector jobs numbers” are going up but are they not going up because so many people are not be counted as unemployed anymore because they supposedly stopped looking for jobs? Are they not going up because computer programers are flipping burgers and or are working part time when they need to work full time.
Is job growth keeping up with population growth? Isn’t this the slowest recovery for jobs since Hoover? Isn’t this Depression the worse one for new college grads looking for a job since Hoover? Are wages really keeping up with inflation? Are wages keeping up with food and gas prices which are not counted as inflation?
A man with a growing family who needed 1 loaf of bread a week just like America has grown in population now needs 2 loaves of bread a week because his family has grown. America has not doubled her population but even if you have a job between higher gas and food prices and stagnant wages he can only afford bread a few slices short of a loaf now.
I welcome more examples of how many more lies can be found in this statement.
If you tell to much happy news much like the boy who cried wolf you risk losing your Cred Government and the Media are losing their Cred as evidenced by Congress Poll numbers and declining Media watchers.
I work for a federal government agency that has been in what amounts to a hiring freeze for the better part of a year now. They called it a “pause,” and there has been next to no media attention. One reason given for the “pause” is anxiety about future budgets.
The current view is that Keynes has been dicredited so we can’t look to the past for a liberal or progressive solution to our problems. The best thing for us, as a nation, to do is cut down on government spending and that is best done by laying off workers. Anyway, we know that government workers can’t do anything right, so it’s best to get rid of them so we can out source the work to put more money in the hands of the 1%. We have the brilliant example of the government cutting spending in the period of about 1929-1932. That sent the economy rebounding and all problems were solved when FDR came in. He had all of those socialist ideas about social safety nets and such things. We have the opportunity to fix that now and destroy these safety nets by killing them with kindness, such as using the budget to allow FICA taxes to be cut and filling that with general revenues. Oh, dear, does that now make SS and Medicare part of the drain on the budget? The answer is to cut them.
I think this is a direct result of the bank bailout by saving the banks instead of doing something else with the money like save people’s homes and or create jobs. By spending money to save banks we lost the opportunity and cash needed to create jobs.
It should be noted that by not regulating the banks and stopping them from gambling the banks are still in trouble despite the bailout.
By not saving people’s homes which the banks have loans on we depressed the value of bank assets and the hope that a quick bank bailout would tide the banks over until home prices bounce back has been proven false.
Nobody is predicting that home prices will get back to housing boom levels for years so the bank bailout seems to have accomplished nothing.
You make several good points, but I think the first one, that “private sector jobs numbers” are going up because so many people are not being counted as unemployed anymore are not connected.
Reuters separates them:
Two separate things.
The GOP, Ron Paul, the media and Obama agree.
The U.S. Office of Personnel Management says this chart is wrong and that more are Federally employed than previously.
http://www.opm.gov/feddata/HistoricalTables/TotalGovernmentSince1962.asp
Meanwhile, State and local public employees swell the group to some 20 million employees. 20 million people in charge of our lives.
I’d say the public sector is doing just fine.
They don’t. They take money from one person and give it to another. New jobs require the production of new economic wealth, goods and services. No new wealth means no new jobs, no new taxes, and no new demand. Only business (ie corporations) can produce new wealth necessary to grow the country.
Government Is The Problem!(TM)(repeat incessantly for thirty years)(clap)
Stunning numbers. The dismantling of the US administrative apparatus, in plain sight, with the passive acquiescence, if not bovine approval, of vast swathes of the public.
How can we be so stupid?
Y’know, I think of Bill Greider’s book title, “Who Will Tell The People”, and it’s clear–the people know. They’re told. Hell, they can see it everywhere. There plain isn’t the mother wit or smarts in this body politic to arrest this calamity, never mind demand better.
Hello. Mayans!
In the end total amount of jobs created in proportion to our growing working age population is the numbers we need. This sounds like parsing the Stats to make the numbers sound good and its dishonest if the Media does not mention the the whole picture.
No they provide a service people need cut teacher’s jobs and your local real estate values fall because who wants to move to a crappy school district? Cut the number of police and crime rises. How much new economic wealth is created in high crime areas even in good economic times in high crime areas?
You can look at job creation under Bush and Obama to see what low taxes does for job creation and you can look at FDR’s record.
Like all of the above comments, I really don’t believe any of the stats. I can see with my own eyes the number of unemployed and under employed. The stats don’t even tell you that the largest number of those new jobs are through Temp Agencies! No benefits, no insurance, no nothing and no promise of long term employment.
Really, the 325k jobs last month were largely temporary and seasonal at disgustingly low retail wages with part time hours. In many cases folks are making less on these jobs than they would from unemployment insurance.
That is true. The retail layoffs will come in on next months numbers. They won’t need people after the holiday sale is over.
Good point and that means more emergency room visits which increases everyone’s healthcare costs just as government is cutting back. States with less taxes and less government spending tend to have lower life expectancies and higher infant mortality rates.
I would love to see estimated numbers of how government cuts to SS Medicare, expecting mothers, the homeless, school lunch programs etc effect life span and infant mortality numbers.
Yes, this is true. The Private sector of which I have always been a part of, even if the Company I worked for had Gov’t contracts, has already eliminated most benefits and job security is non-existent. The Public sector has gone right ahead however trying to maintain both while laying off increasingly larger nos. of people to do be able to do this. I have no gripe personally with public workers, my one gripe about the system is that in my own experience getting a job in the Public sector is more about who you know then what you know or what you can do and this pisses off a lot of people , who like myself don’t have any political connections.
Also, people are so afraid of losing the job they have that they work extra hours, producing much more for the corporation at the same or less in wages and benefits. This gives the corps an even more upper hand in greater production/out-put from lesser employees.
I have a friend that was so sick he could barely get his head off the pillow, but went to work everyday as he was terrified of losing the job.
Yep. All 20 million of those public sector employees have a cousin or a buddy in a position of power.
It’s my understanding that the bulk of these lost public sector jobs have been teaching positions. And the bulk of those women. Both of these are just further bad indicators for our future.
Public Sector Depression: This is what drowning gvernment in a bathtub looks like.
Yes, the numbers we’ve seen are because they were [intentionally] counted wrong – they were supposed to be seasonally-adjusted, but the season wasn’t fully adjusted for. There’s just a whole host of problems with the official numbers – Obama claims to have created over 3 million jobs, yet less people are working now than when he took office as the labor force has shrunk even if the unemployment rate had stayed the same from the day he took office.
Also broadly, I do think there should be in a public sector “depression” in at least one area – the military. The military should be downsized.
The public sector acts as a stabilizer for the overall economy, while volatility comes from the private sector. Push the balance towards the public sector, and you have more stability, but sacrifice the highs (and lows) possible from the private sector. Push the balance the other way, and you have bigger potential highs (and lows) without public sector stability.
You only have to understand who profits the most from volatility (hint: who makes money on both the ups AND downs) to understand the current push towards destabilization.
Sorry, but where does the money come from that pays these people? Taxpayers.
Taxpayers that collectively agree that it is worth paying Govt to manage taxpayer hires.
I’m very fortunate to have a public sector job for which I get a *very fair* salary (for my level of experience, education, etc) and *decent benefits.*
I also have a very part-time job in the private sector. I’ve worked for the same private sector corp for about 15 years. I have gotten one sort of “raise” in 15 years, other than having hourly wages raised once in a blue moon when min wages are raised.
I happen to like this job but am mightily grateful that I don’t depend on it for survival. I can state unhesitatingly that over the past 2 years, esp, corporate has sought every single means to downgrade our already very paltry wages. I am working more and more often “for free” – as in: I do work for which I am NOT compensated. It is a *choice* I make, so I accept responsibility for what I *chose* to do.
That said: it’s simply NOT RIGHT. And there are employees who really *rely* on our pathetically paltry wages for the bulk or all of their income. Our managers are called upon by the fat cats at the top of the pyramid to browbeat the worker-bees. What I do is by no means some kind of “simple” work. It’s actually rather sophisticated, esp in terms of providing high level customer service.
If we complain “too much,” then we are fired. Happens often.
Welcome to the new private sector job reality.
It goes without saying that the fat cats at the top make million$$$ bc this company is VERY successful. The workers who do, you know, the actual WORK are very definitely treated like DUMB SLAVES.
I make my own choice to continue working in this job, but I am lucky bc I CAN leave at any time. Not everyone is in that position.
Long term unemployment may be a more serious problem than high employment, itself:
http://online.wsj.com/article/SB10001424052970203513604577144483060678656.html
All these numbers are cut so many ways, one could fabricate any stance useful at any time. Listening to any one of the pols (or an economist) seems bound to not reveal a big picture. There will be an agenda, tweaking of cause and effect, etc., to suit the need.
Reversing the trends in public sector employment seems to be an unfortunate pipe dream. Upcoming DOD cutbacks will cause another breathtaking impact. One cannot expect most of those, say, US 80,000 troops just in Europe, mustered out, to show up again in Fed or state hirings elsewhere. Yet it was money spent badly I suppose since at least the collapse of the USSR. What next?
I’ve had some really mixed thoughts on this of late. We’ve pulled our troops out of Iraq, meaning all of them, their logistical support units, and their supporting staff are now out of a job essentially. Many of those folks had been stop-lossed to keep troop levels up. Now that this is no longer necessary the military will be releasing these folks from service (I assume, unless we start another ground war).
I am squarely against all of our many military incursions and think that we need to cut the military at least in half, spending and staffing levels included in that.
But then what do we do with all those folks who are out of a job? We’ve taken massive amounts of money out of the consumer spending pool and left a couple million unemployed.
We don’t currently have any solution to this.
Lots of city and county layoffs here in Houston. Many teachers too. Especially counselors, non-critical like speech and drama, stuff like that. I have several friends who were/are affected.
Kris wrote: “I am squarely against all of our many military incursions and think that we need to cut the military at least in half, spending and staffing levels included in that.
But then what do we do with all those folks who are out of a job? We’ve taken massive amounts of money out of the consumer spending pool and left a couple million unemployed.
————
I agree. We don;t need the size of military we have. BUTTTT, what do we do with them in the middle of a recession? Some military skills do not translate well into the private sector. How many part-time former military can WalMart hire???
It’s a good idea to look at where the cutbacks and drawdowns are coming from, and compare. Most of those supporting the Iraq and Afghanistan activity are reservists and guard troops. Most of them should still have jobs back in the US.
I think the situation in Europe is still very different, though, as I mentioned above. A lot of career, full time, active duty troops are there.
During my last few years before my USAF retirement in 1990 it became obvious where and how the personnel heavy lifting was going to be redistributed — to the Guard and Reserves, since it would be cheaper. But there are limits to how far that trend could go.
Maybe someone more current in this could offer thoughts on how hundreds of thousands of troops drawn down might be divided among the various components.
Agencies in county brace for big cuts | Watch Sonoma County
“These are deep cuts on top of the cuts we’ve already been making in the last couple of years,” Efren Carrillo, chairman of the Sonoma County Board of Supervisors, said of local government programs.
http://www.watchsonomacounty.com/2011/12/sacramento/agencies-in-county-brace-for-big-cuts/
This year, the lay-off roll, at the school district where my wife and I work, will be read in March. If we’re among the lucky “retained” workers, next year (after five years with virtually no raises) we will receive a 5% pay cut . Things could have been different…
Under Obama, a Record Decline in Government Jobs
New York Times
January 6, 2012:
When Barack Obama ran for president four years ago, he appalled some Democrats by saying Ronald Reagan had been a transformational president.
Three years into his presidency, he has exceeded Reagan in one area: reductions in government jobs.
Particularly devastating has been President Obama’s unwillingness to recognize the importance of public employment in sustaining the economic recovery, in providing a lifeline to a fast-sinking African-American population, and in providing a crucial bulwark against Corporate America’s efforts to drive down wages for all workers.
The failure of Obama and other top Democrats to defend public spending and the public sector—along with their incessant repetition of other key pieces of conservative economic dogma—has allowed Republicans to divert America’s attention away from its most pressing problem: the prolonged, agonizing jobs crisis
TCU, I think that shooter is a paid troll but, to give credit, she/he is quite good at packaging a nonsense argument to try to get people diverted. We have 10 years of history with tax cuts and how quickly tptb move to create jobs. We should now be rolling in jobs, more jobs than people to fill them. Instead, we get an economy that is still on the verge of collapse and corpses and banks holding tightly to any money that comes in. Tax cuts and money held don’t create jobs, only demand does.
Amazing isn’t it? I didn’t say all did I ? I meant it’s an unfortunate feature of the Public system.
As soon as the PTB figure out a way to out source or export Gov’t jobs the way they have Private ones that will be the end of the Public service Unions and all they provide the average Public service employee. Soon when you call City hall or the State/Feds. you’ll hear that Indian call center person and you’ll know why Uncle Bill was laid off permanently. ( like the rest of us.)
Everything in this article is correct, and so are most of the comments. However, public employees have only themselves to blame. For decades they’ve conspired with politicians to hide the eventual true cost of their pensions and post-employment health care. That led to underfunding, and now it’s time to pay the piper. The public at large, suffering from decades of decline in private sector wages and benefits, is now told it must pony up more money to maintain current services while also back-filling pension deficits. Naturally, the public is unwilling to support this; ergo, personnel cuts are the only solution.
The blowback from the pension abuses that the public employee unions aided, abetted, exploited, and benefitted from for decades is now coming home to roost.