While private sector growth continues to be anemic, it has been in positive territory for the past few months. The real story from the jobs market, however, appears to be on the public side. State and local governments across the country have faced record budget shortfalls in 2010, and most have opted to lay off workers in order to close the gap.
The result has been employment reports like the one from July, in which the public sector, even discounting the end of temporary census work, shed 48,000 jobs.
“All of us knew that the municipal government funding is a ticking time bomb,” said economist Robert Brusca of FAO Economics. $26 billion in federal aid should be coming down the pipeline soon, but it will only mitigate, not eliminate state and local layoffs.Public Sector Dragging Down Jobs Numbers by Harrison Barnes