More State and Local Job Losses in December

People pick up boxes of groceries at a food bank held at Los Angeles Boys & Girls Club in the Lincoln Heights neighborhood of Los Angeles, Thursday, Dec. 17, 2020.

People pick up boxes of groceries at a food bank held at Los Angeles Boys & Girls Club in the Lincoln Heights neighborhood of Los Angeles, Thursday, Dec. 17, 2020. AP Photo/Jae C. Hong

 

Connecting state and local government leaders

The total number of jobs lost in the state and local public sector is now approaching 1.4 million. December was also a grim month for leisure and hospitality employment.

Declines in state and local government employment grew deeper in December with total job losses compared to before the coronavirus pandemic approaching 1.4 million.

Labor Department figures released Friday showed that state and local employment dropped by a combined 51,000 jobs last month, with the number of local government jobs shrinking by 32,000 and state jobs by 19,000. A decline of 19,900 education jobs drove the state losses, and was offset by gains of about 800 jobs in other parts of sate government. Almost all of the month's local losses were unrelated to education.

Compared to February, state and local employment levels in December were down by roughly 1,385,000, based on the latest Labor Department estimates, with employment now totaling around 18.5 million. Many of the losses have been in education jobs.

The job loss figures include not only layoffs, but also other types of losses, like furloughs, hiring freezes, and unfilled positions.

The government figures came alongside other bleak statistics in the latest monthly report on the nation's jobs situation.

It showed that total non-farm payrolls fell by 140,000 in December. The nation's unemployment rate held steady at 6.7% last month, with gains in some sectors and losses in others. There were deep declines in the battered leisure and hospitality industry, which includes businesses like restaurants, bars, amusement parks and casinos.

Overall, there were 498,000 leisure and hospitality job losses, with 372,000 tied to businesses that offer food and drink services. Leisure and hospitality jobs are now down 3.9 million, or by about 23%, compared to before the virus-driven downturn hit.

The latest employment estimates come as Covid-19 is again surging in parts of the country and as governors and other officials have in recent weeks again tightened restrictions on certain businesses, like restaurants, as they try to prevent the disease from spreading.

"This is the clearest sign yet that tighter social distancing restrictions are weighing on the economy, with half a million jobs lost in the leisure and hospitality sector in December," said Brian Coulton, a chief economist at Fitch.

"The more reassuring aspect of the report is that employment declines were very concentrated, with most industries outside leisure and hospitality seeing gains," Coulton added.

The Economic Policy Institute noted that long-term unemployment, of 27 weeks or more, continues to rise, increasing by 27,000 in December.

December's job losses also came as Congress struggled to come to agreement on another relief package to help offset some of the economic fallout that businesses and households are dealing with because of the virus. Lawmakers did eventually pass legislation that President Trump signed at the end of the month.

Bill Lucia is a senior reporter for Route Fifty and is based in Olympia, Washington.

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