State and Local Government Jobs Flat in June, But Employment Levels Still Low

A shopper stands outside of a Pier 1 Imports store as going out of business signs are posted amid the coronavirus pandemic Wednesday, July 1, 2020, in Santa Clarita, Calif.

A shopper stands outside of a Pier 1 Imports store as going out of business signs are posted amid the coronavirus pandemic Wednesday, July 1, 2020, in Santa Clarita, Calif. AP Photo/Marcio Jose Sanchez


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Employment in the sector is down by about 1.5 million since the coronavirus hit.

State and local government employment barely changed in June compared to May after two months of heavy job losses in the sector, even as other parts of the economy saw job gains,, according to federal figures released on Thursday.

Local government jobs grew by about 57,000 from May to June. But the gains were driven by about 70,000 jobs added in local government education. Non-education local government employment fell by 13,800, according to the Labor Department estimates. In state government, jobs declined by 25,000 with 18,800 education losses. 

The education numbers are affected heavily by government action around K-12 schools, which were shuttered this spring as the coronavirus outbreak began to rage. In recent days, some local governments have begun to outline plans for school re-openings.

State and local governments, which are seeing the virus erode tax revenues and roil their budgets, have seen employment shrink by about 1.5 million jobs since February, before the virus hit in full force. Richard Auxier, a researcher at the Urban-Brookings Tax Policy Center, pointed out on Twitter on Thursday that employment across the two sectors is at lows not seen since 2001.

More broadly, the nation's total non-farm payrolls increased by about 4.8 million in June, with the official unemployment rate falling from a historic peak of 14.7% in April to 11.1%.

President Trump celebrated the jobs gains. “Today’s announcement proves that our economy is roaring back, it’s coming back extremely strong,” the president said.

But while the June unemployment rate is an improvement, it is still high and remains above the roughly 10% threshold where it crested in 2009, around the time of the Great Recession. Data going back to the post World War II era show that the only other time unemployment neared the 11% mark was in the early 1980s, at around 10.8%.

Also troubling is that the number of permanent—as opposed to temporary—job losses continued to rise in June, climbing by 588,000 from May to 2.9 million.

Economic activity around the country has been gradually ramping up compared to when the virus outbreak first struck the U.S. in the late winter and early spring. But the disease has also been flaring badly in states like Texas, Florida and Arizona, stifling some reopening plans.

Leisure and hospitality were among the industry sectors that showed the strongest gains in June, similar to May.

This part of the economy, which includes businesses like hotels and restaurants, has been one of the worst hit as the public health crisis has resulted in government-mandated business closures and other restrictions meant to curb the spread of the virus.

The Labor Department said that retail, education and health services, manufacturing and professional and business services also had notable jobs gains.

Bill Lucia is a Senior Reporter for Route Fifty and is based in Olympia, Washington.

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