April 30, 2008
Federal, state and local governments are hiring new workers at the fastest pace in six years, helping offset job losses in the private sector.
Governments added 76,800 jobs in the first three months of 2008, the Bureau of Labor Statistics reports.
That’s the biggest jump in first-quarter hiring since a boom in 2002 that followed the 9/11 terrorist attacks. By contrast, private companies collectively shed 286,000 workers in the first three months of 2008. That job loss has led many economists to declare the country is in a recession.
Job numbers for April, out Friday, will show if the trend is continuing. Some economists say a government hiring binge could soften a recession in the short term.
“Government jobs are an important cushion for the economy when the private sector falters,” says North Carolina State University economist Michael Walden.
But the job expansion could later cause financial problems for governments that are spending too much.
“More hiring has nothing to do with good government or economic policy,” says economist Kenneth Brown, research director at the Rio Grande Foundation in Albuquerque. “It has everything to do with government being slow to react to economic change.”
Government hiring began to boom last year around July 1, when most state and local governments started new fiscal years. Those budgets were based on forecasts established in a strong economy. In each quarter since, the total government workforce has been the most in at least six years.
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