Madness In December Employment Numbers
The new job numbers are out and, at first glance, there is nothing surprising here. Job growth continued to inch upward in December, with 155,000 new jobs added. Of course, with several million young people joining the labor force every year, numbers like these don't actually amount to growth. We are just running in place.
But here's a statistic that jumped out at me: 89,000 public sector workers lost their jobs in October, November, and December—with most of those losses, 66,000, occurring in October.
These numbers are revised figures that are much higher than what appeared in the past BLS employment releases, so for some reason the BLS tends to lag behind in capturing the full scope of government layoffs in a timely fashion.
Anyway, back to the main point: Large-scale layoffs of government workers continue across the United States. Such layoffs undermine local economies and stymie the recovery. For every five workers who were hired in the past three months, one was laid off by government.
This doesn't make sense. Government may not always do such a great job of stimulating employment growth through fiscal and monetary policy, but it sure as heck can bolster the job market by continuing to employ those people who do have jobs. Instead, thanks to austerity policies, government has been doing the exact opposite.
Many of these laid off workers will get on unemployment and perhaps collect other government benefits such as food stamps, the EITC, or SCHIP. They also, obviously, will no longer be paying taxes. So quite apart from the human costs and economic costs, in terms of depressed consumer spending, layoffs of public workers don't deliver all of the fiscal gains imagined because the unemployed cost government money while no longer contributing to the tax base.
And there are other costs, too. As we have noted here often, a great many of the public sectors workers being laid off by state and local governments work in education. As a White House report noted in August:
More than 300,000 education jobs have been lost since the end of the recession. Since the end of the recession in June 2009, the economy lost over 300,000 local education jobs. The loss of education jobs stands in stark contrast to every other recovery in recent years, under Republican and Democratic Administrations.
The loss of teacher jobs can mean larger class sizes and difficult choices for schools. The national student-teacher ratio increased by 4.6 percent from 2008 to 2010, rolling back all the gains made since 2000. Further layoffs in 2011 and 2012 mean that the student-teacher ratio will continue to increase as we enter the 2012-13 school year. From Florida to Ohio to California, districts have faced teacher shortages, have cut preschool and kindergarten programs, and have shortened the school week and school year.
This is wrongheaded in so many ways.
Even the most cursory student of economics understands that investing in human capital is one the best ways to bolster long-term prosperity. And anyone who has followed the rise of China, India, and other competitors knows that these nations are pouring big resources into education.
Yet over here, even as signs abound of America's eroding competitive edge, we are firing school teachers and shoving kids into bigger and bigger classes. That's got to stop. Not just to get out of the current slump, but to prosper in a global economy.
The fiscal cliff deal should have included new aid to the states to prevent these layoffs. It didn't and America— along with its children—will be paying the price this year. And for years to come.
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