By Susan Milligan, Stateline, Pew Charitable Trusts
Public employment, long seen as a secure job with good benefits, took a series of hits during the recession, with state and local governments implementing hiring freezes and layoffs. But job-seekers can take solace: Many states and localities are now hiring, buoyed by an improving economy and better-than-expected revenue.
Elizabeth Kellar is president and chief executive officer of the Center for State and Local Government Excellence
Nearly three-quarters of states and localities reported making new hires in the past year, according to a recent report, the second year in a row the jurisdictions put new people on the payroll. "I'm cautiously optimistic," said Elizabeth Kellar, CEO of the Center for State & Local Government Excellence, a nonprofit that helps government attract workers and one of three groups that conducted the survey. "It's generally good news that they are able to hire again and are seeing salary gains, [although] they are still lagging behind the private sector."
Much of the hiring is driven by "pent-up demand" from the recession years, along with a burst of retirements by people who feel more confident about leaving their jobs now that the economy is recovering, she said. More than half of respondents reported higher levels of retirement in 2013 than in 2012, and 13 percent said their employees had accelerated their retirements.
Meanwhile, the growth in state revenue has also loosened the grip on public purses, said Brian Sigritz, director of state fiscal studies for the membership organization National Association of State Budget Officers (NASBO).
At least 10 states collected more tax revenue than expected in April, Sigritz found, and 42 states expect their budgets to grow in fiscal 2016. State tax revenue overall was up 5.1 percent in the first quarter of 2015 compared to the same period in 2014, according to the U.S. Census Bureau.
But Sigritz said increased hiring may not lead to permanently larger state and local workforces, which still are not back to pre-recession levels. "It's likely that we're going to continue to see an uptick in hiring. But we're not expecting a surge in hiring," Sigritz said. "It's definitely not back to where it was, and I wouldn't be surprised if it never got back."
Some states, particularly those with governors advocating trimmer budgets and smaller government payrolls, are continuing to cut their workforces. Louisiana, for example, went from a high of 117,300 state workers in February 2009 to 84,300 this June, according to the US Bureau of Labor Statistics (BLS). "We view the reduction of state government as a smart policy decision. Our goal in Louisiana is to ensure the prosperity of our private sector, not to increase government," state Division of Administration spokesman Greg Dupuis said in a statement.
But overall, state and local payrolls have expanded slightly in the last two years, going from 5,049,000 in May 2013 to 5,081,000 this May for states, according to the BLS, and from 14,032,000 to 14,094,000 for localities. The increased slots do not include new employees replacing those who have quit or retired. In December 2008, state government employment was at a pre-downturn high of 5,191,000 nationwide, while local government employment that month was at 14,590,000.
States with expanding workforces aren't necessarily doing broad-based hiring. In Kentucky, for example, the state payroll went from a recession-era low of 85,500 in February 2009 to 104,300 this June. But much of that was due to an increased number of university students serving in state-subsidized work-study jobs, said Manoj Shanker, an economist with the state's Education and Workforce Development Cabinet.
"On the face of it, it does look like we're fat and happy, but that's not the situation at the moment," Shanker said.
In Oregon, state government employment went from 78,100 in February 2009 to 87,200 this June. But while the state is doing better financially — revenue is high enough now to trigger Oregon's "kicker" law giving taxpayers a rebate on what they paid — the expansion of the workforce is due largely to the reclassification of home health workers, paid with tax dollars, as state workers, said Nick Beleiciks, an economist in Oregon's Employment Department.
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