Friday, January 6, 2012

Government Accounted For Nearly A Third Of All Layoffs In 2011


For government workers and financial sector employees, last year was a particularly bad one -- and 2012 likely won't be much better.
More jobs were lost in the government sector than any other industry in 2011, according to a report released Thursday from outplacement company Challenger, Gray & Christmas. The financial industry came in second place, followed by the retail sector.
All in all, job cuts rose 14 percent in 2011, topping more than 600,000 by year's end. It's perhaps the last piece of bad news to come out of a year in which unemployment remained high, poverty grew more widespread and the economy came close to sliding back into a full-fledged recession.
Government alone cut 183,064 jobs in 2011, the most in nine years, according to the Challenger report. Those layoffs accounted for 30 percent of the year's 606,082 total job cuts.
Read the rest at The Huffington Post
Government Accounted For Nearly A Third Of All Layoffs In 2011: Report
by  Alexander Eichler

Interestingly, the headline in the local paper today was that Iowa City is hiring more teachers to decrease class size. Apparently parents (who vote) didn't like the policy of austerity and have an interest in their children's future.

11 comments:

Ralph Musgrave said...

Stark raving bonkers. If there is one organisation capable of maintaining employment in a recession, it is government. We’d be better off with Laurel and Hardy in charge of the IMF, Bart Simpson as President of the U.S. and the Marx Brothers in charge of the ECB.

Broll The American said...

In regards to the line about Iowa City hiring teachers... they're only planning on hiring 8 teachers. This is in contrast to a massive overhaul being planned in Des Moines, which if played out to the fullest, will purge their education system of qualified veteran teachers and replace them with proctors who monitor students sitting in front of terminals that are teaching to end of year exams.

This is the future of public education... online distance learning. Tax payers don't want to pay any more so thousands of students can video stream 1 teacher performing the same lesson plan year after year. THINK OF THE SAVINGS! We'll have to see after about 30 years or so how that eventually shakes out.

Matt Franko said...

Ralph I believe a lot of these layoffs are at the state and local level, who get a lot of their revenues off of transactions.

A friend of mine who does business with the City I'm in (which is 1 of the 50 US state capital cities) had them bounce a check to him recently, and now they are trying to hold him up for his $20 returned item fee...

The streets are not being swept and sidewalk/streetscape maintenance is not even being done so there are weeds growing all over the place and trash is starting to collect.

This does not look like things are getting better over here...

Resp

Anonymous said...

... which means that all the federal government has to do to start an employment program is to tell the states to hire back all the people they would like to hire back, and then send the paychecks from Washington. No new bureaucracy; no deep thinking or heavy lifting involved.

Unlike the private sector, where some might prefer to think that a lot of the jobs lost are due to permanent shifts of resources and creative destruction, with government the jobs lost are things that state governments and their taxpayers still want done, but just can't afford to do.

To make sure the states don't use the program to finagle a permanent federal subsidy for state employment, juts say at the outset that the amount supplied will be reduced by a certain amount each year, going down to zero in five years. As we grow out of the recession, state tax revenues increase and we gradually shift the responsibility for paying its employees back to the states.

Anonymous said...

By the way, Cullen Roche has a new post up on the JG, but has turned off comments for fear the internet might explode.

Tom Hickey said...

The problem with that Dan is that the right is applauding the reduction in government employees. And it just takes a couple of senators to block any legislation in the US.

Anonymous said...

Perhaps local taxpayers won't be skinned alive every year going forward thanks to budgets going up faster than inflation.

Anonymous said...

And the private sector is picking up the slack: http://www.nytimes.com/2012/01/07/business/economy/us-adds-200000-jobs-unemployment-rate-at-8-5.html?_r=1&partner=rss&emc=rss&src=igw

Anonymous said...

Tom, I agree. And some states would even refuse the money out of ideology. The fact is that the current Congress is likely to block anything decent. But it would be at least good to put these things on the table so that everyone can see what these guys are voting "no" to.

Tom Hickey said...

Anon: And the private sector is picking up the slack

Need to parse those figures though. I'll post what the fine-tooth-combers have to say when it comes up.

Clonal said...

I think, people over the last 30 years have an increasingly distorted concept of what is government, and what is private. See Jim O'Reilly's The ‘Private Sector’

Quote:
The “Private Sector” is a very popular term that’s embedded in our politics and in mainstream and not so mainstream economics. Those of us seeking a better world, though, need to banish it from our discourse as it communicates so little while hiding so much.

The “Private Sector” is widely understood to be the “sector” that operates outside the government. But which industries actually do so? Are Lockheed Martin, Northrop Grumman, or Boeing in the “Private Sector” when the bulk of their business comes from government? Or the banking industry whose business model of high leverage couldn’t exist without government deposit insurance or a government lender of last resort we call the central bank? All of finance is tightly integrated with government and it’s highly dubious to consider it private. Witness the unsurprising speed of the recent public bailouts of these “private” firms. How about the railroad industry of the past, the key driver of the 19th century economy, which crucially depended on public land grants? Or the automobile industry which wouldn’t exist without public roads? The entire socioeconomic system of mass production capitalism, in fact, is integrally dependent on government and wouldn’t be long for this earth if it lived solely through “private” means. We can easily imagine the unemployment and purchasing power calamity that would ensue if the US government terminated its massive injection of purchasing power from military spending, research, and “entitlements”. Or if the European states ended all spending.


There is some spending that is better allocated by community action, and other spending that is better allocated by individual action.

"Government spending" is spending on things that improve the well being of the entire community, while "individual spending" only concentrates on the well being of the individual.

The problem lies in assuming that individual well being in the aggregate always leads to the highest degree of well being for the community at large.

Social well being (let alone optimal social well being) is almost never achieved by each individual maximizing their own self interest.