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State and Local Job Losses Top Half a Million

Police, firefighters, nurses, teachers, bridge inspectors and agriculture specialists have one thing in common besides making the quality of our lives better.  They are part of a state and local government workforce that is losing jobs at a distressing rate.

State and local governments laid off 30,000 men and women in May, and they have laid off more than half a million since the recession began.

Local school districts, counties, and cities eliminated 28,000 jobs in May, the Bureau of Labor Statistics reported today.  Another 2,000 state government workers lost their jobs, leaving state payrolls well below their pre-recession levels.  May was the eighth consecutive month—and the 27th out of the last 33—in which total state and local employment shrank.

Why?  Not because we don’t need teachers and cops, but because the long, deep recession and its aftermath have deprived states and localities of revenue needed to pay salaries.  Revenue in the states is nine percent below pre-recession levels.

The job cuts have been widespread.  Since state and local employment peaked in August 2008, payrolls have shrunk by 535,000 (see graph).  For example:

  • Local school districts have cut 201,600 positions.
  • Cities, counties, and other local governments have cut 235,600 jobs.
  • State governments have cut 98,000 workers.


The sharp decline in state and local employment comes even as demand for their services is rising.  There are, for example, 7.6 million more people enrolled in Medicaid, mainly because so many lost their health insurance when they lost their jobs.  And this fall there will be an estimated 261,000 more public school students than when the recession began.  The numbers of senior citizens, young children, and unemployed individuals— three groups that tend to use more public services — also have grown.

As we’ll detail in an upcoming report, in the coming fiscal year, states face large new revenue shortfalls that are likely to lead to even more job losses in the public sector over the next year or more.

And, given the labor-intensive nature of most government services — teaching, policing, firefighting, and the like — it’s hard to see how governments can continue to cut so many workers without seriously harming the quality of life of the communities they serve.