The Rabid Behemoth Grows And Will Grow More
As Private-Sector Jobs Declined, Government Employment Increased
Monday, January 12, 2009
By Matt Cover
(CNSNews.com) – Despite the highest unemployment rate in 15 years, government grew at all levels in 2008, continuing a seemingly unstoppable trend that has withstood recessions, wars, and record budget deficits. Health care and education also added jobs in 2008, continuing their iron-clad growth trends as well.
State, federal, county and local governments employed approximately 22.5 million people in 2008, according to a report released Friday by the U.S. Department of Labor. Additionally, 13.4 million people were employed in the healthcare sector, and 3 million worked in education, according to the report.
Unemployment rose to 7.2 percent in December 2008, up from 6.8 percent in November and 5.8 percent in 2007. Government, healthcare, and education were the only three sectors that didn’t shed jobs in 2008.
The federal government added 84,400 jobs in 2008.
Federal government employment is traditionally recession-proof, due to the fact that the federal government usually runs a considerable budget deficit. State and local governments generally cannot, making their growth seem paradoxical given the country’s crippled economy.
State governments added 11,600 jobs in 2008, while local governments added 68,100 jobs. State and local leaders have pressured the incoming Obama administration for federal assistance, saying massive federal aid to states and localities is necessary to keep the economy from deteriorating further.
Nine Democratic governors have called on the president-elect to include education and healthcare spending in any stimulus proposal, saying that federal help would be necessary to prevent dramatic declines in services.
“It’s clear that the federal government needs to jump in and jumpstart the economy,” Massachusetts Gov. Deval Patrick said on Jan. 2.
The governors called on the federal government to provide states with $1 trillion in total aid to all 50 states.
The proposal included $250 billion in education funding and another $250 billion in Medicaid spending.
“We aren’t crying wolf,” Ohio Gov. Ted Strickland explained. “These are real circumstances, unprecedented situations we are facing.”
Despite the dire picture painted by the governors, however, education and health care both grew in 2008 – even outpacing the growth of government. Education grew by 96,600 jobs, while healthcare added an astounding 371,600 jobs last year,
Total governmental spending on all levels for health care was $760 billion in 2007, according to the U.S. Department of Health and Human Services. Private health care spending was $1.2 trillion for 2007, according to HHS figures. States provided approximately $240 billion in health spending.
Education spending totaled $526 billion for 2006, the latest year for which data is available, according to the U.S. Census Bureau. Local governments provided 44.4 percent of education funding. States provided 46.6 percent, and the federal government provided nine percent, according to Census figures.
All levels of government have grown steadily for the past decade, according to Labor Department statistics. The federal government has expanded by approximately 125,000 jobs on average over the past decade.
State government, absent education, grew by 138,000 jobs on average, while local governments have added 875,000 jobs on average since 1998.
These trends, which would appear to be remarkable amidst the worst recession in nearly a century, are misleading said Nicholas Johnson, director of the state fiscal project at the Center for Budget and Policy Priorities.
States and localities are still running on last year’s budgets, delaying the impact of the recession that is already gripping the private sector.
“The reason you’re not seeing the widespread layoffs is that state and local governments are still in their current-year budgets, the budgets that were passed last spring,” Johnson told CNSNews.com.
State and local governments, and the industries that depend on them, won’t feel the economic pain until next year, when the reality of drastically shrunken tax revenues fully sinks in, Johnson said.
“The big cuts are going to show up in next year’s budget,” he explained. “In the last recession, state government employment rose during the recession itself (but) after the recession was over government actually lost jobs, from 2001 to 2003.”