Private versus public job growth

Date posted: July 23, 2012

Sometimes the private economy — meaning private businesses — and the public economy — meaning government — go in different directions. Has this been the case recently with jobs? N.C. State University economist Mike Walden answers.

“Certainly has. … If we look since February of 2010, why do I choose February 2010? Well, that’s when the aggregate job market bottomed out, and since February 2010 in most job markets we’ve seen jobs increase. Since that date, we have actually seen private sector jobs at the national level go up by 4 percent. Not a robust number, but not bad. Public sector jobs are actually down since that time period at the national level by 2.2 percent.

“Now we see the same thing here in North Carolina. Since February 2010, private sector jobs in North Carolina have increased just shy of 3 percent, whereas public sector or government jobs are down by .3 percent. So we have seen over the last couple of years public sector jobs and private sector jobs go in different directions.

“And a large reason behind this is what’s happening at state and local government levels. Because of the recession, state and local governments have seen their revenues squeezed. They have to operate under balanced budgets. So, if they don’t have as much revenue they have to cut spending. Cutting spending often means a reduction in jobs.”

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