Government employment: Job insecurity

Source: Ronald A. Wirtz, Federal Reserve Bank of Minneapolis, Fedgazette, January 24, 2013

Despite the imprimatur of job security, the ax has (belatedly) fallen on public sector employment, especially at the local level… Government employment has seen significant job losses since 2010 across all levels of government and most district states. While private employment dropped dramatically with the recession, public sector employment actually rose, thanks to the federal stimulus. A slow economic recovery and the end of stimulus funding have led to hard budget decisions, particularly among local governments. Local governments in Minnesota and Wisconsin have seen the largest cuts. But rather than a recent phenomenon, local government employment in these states has fluctuated for the past decade, thanks to periodic state budget deficits and subsequently less state aid to local governments. …