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Georgetown University seniors pose for graduation pictures early due to the school moving to online classes only because of the coronavirus outbreak, March 18, 2020.
Some 3.7 million kids will graduate high school this June and another million-plus students will get college degrees. Beyond the pang of missing commencement, they will all graduate into a job market with few jobs.
Worse, since they have no work history, they do not qualify for expanded unemployment benefits available to laid-off workers. Meanwhile, state and local governments are planning layoffs, as tax revenues plunge with the collapsing economy.
State and local governments spent about $3.3 trillion last year. The recent stimulus package gives them less than 5 percent of that—just $150 billion. But their revenues will plummet by several times that. Unlike the feds, state and local governments can’t print money or run deficits.
There is a rendezvous here waiting to happen. In the next recovery bill, let’s add about a trillion dollars for state and local government. In turn, cities and states can hire recent graduates.
If anything, state and local government needs to start spending more money, and adding more workers, not fewer. For instance, state unemployment offices will be overwhelmed processing new applications. And if Washington comes through with serious public-works spending, states and cities will need to staff up to plan it.
While the government is at it, federal agencies also need to staff up. The Small Business Administration faces a vastly increased load as businesses seek emergency aid authorized by the rescue law, and other agencies are processing unprecedented applications for help as well. We also need more IRS employees to keep an eye on the inevitable increased tax fraud, given all the new corporate largesse.
After decades of government-bashing, the total number of federal employees stands at about 2.8 million, barely half the number per capita of the 1960s. Government, heal thyself.