Job Creators: How Public Sector Employment Lifts All Boats
For the most part, public sector employment has undergone a massive and wasteful gutting over the course of the recession -- in 2011 alone, 22,0000 public sector jobs were cut every single month, sucking money out of the economy and adding to overall unemployment.
But a new report from the Urban Institute helpfully points out that this story is not the case everywhere: In fact, since the start of the recession, several cities have actually chosen to preserve and even expand public sector employment.
And, no surprise, these metro areas ultimately enjoyed significant private sector expansion as a result. The chart below offers a crystal-clear look at the job-creating stimulus delivered by increasing public sector employment:
And let's be clear: We typically measure stimulus effects by how much money or economic activity gets injected into the economy, and we use this to conclude the likely benefits for job creation. But the chart above is even more precise: It shows directly how much total employment at the local level grows in response to an increase in local public sector jobs.
It's also, of course, worth noting what happens when public sector jobs get cut -- that negative trend line in the third quadrant of the graph shows the domino effect of private sector job losses resulting from cuts to local government employment.
The President made a powerful speech yesterday about the failure of right-wing economic theories, stating "You would think that after the results of this experiment in trickle-down economics. . . were made painfully clear, that the proponents of this theory might show some humility."
They clearly haven't so far, but maybe if clear-cut reports like this keep coming there's a chance that somebody on their side will start listening to the facts.