Uncategorized

State Jobs Numbers Released on Wednesday Signal North Carolina is on the Wrong Path

Four months into the implementation of the FY 2011-2012 budget, the Office of State Budget and Management (OSBM) reported that the equivalent of 1629 state workers were receiving severance payments resulting from reductions in force (i.e. layoffs). Those laid-off workers have increased the number of North Carolinians without a job in the state. Their loss of income will ripple through the economy, and the loss of their service to our communities will impact families across the state.

But the numbers released on Wednesday only tell part of the story. Because the numbers presented reflect only those who are receiving a severance package, they do not capture the positions that have been lost when normal turnover provides state agencies with the opportunity to cut a job without having to lay off an individual. These numbers also don’t capture the jobs that have been cut when local governments are forced to balance their own budgets with fewer dollars from the state when faced with the same, if not greater, demands in their communities. And then there are the jobs supported by federal recovery dollars that didn’t get funding from the state when those dollars ran out.

All of these very real numbers need to be monitored because of the different things they tell us (and measure) about the way budget and policy decisions are playing out in communities.

And that brings us back to the ripple effect of job loss. The most significant omission in the discussion of public-sector job numbers is the impact these will have on the private sector. Budget cuts affect private businesses in two ways. First, businesses suffer because their customers—those laid-off public-sector workers—no longer have money to spend, and the high unemployment rate means many of these workers will struggle to find new jobs. Secondly, much of the money that state government pays for public services goes to private businesses; for example, money spent on Medicaid goes to doctors, hospitals, therapists and others.

The N.C. Budget & Tax Center conducted a whole-budget analysis of the net effect of spending cuts and tax cuts in the final budget using industry-standard economic modeling.  The findings estimate that over the next two years the state is likely to lose nearly 30,000 jobs, on net.  Nearly half of these jobs will be lost in the private sector, the vast majority in the health care industry.

The OSBM numbers released on Wednesday give us one measure of the impact of state budget decisions.  These impacts will be varied and long-lasting.  What is clear, however, is that continuing down this path will lead us further from a strong economic recovery.

One Comment


  1. UCubed

    November 21, 2011 at 6:39 pm

    thanks

Check Also

Measuring poverty shows that government programs are working

Every year when the Census Bureau releases its ...

Top Stories from NCPW

  • News
  • Commentary

The 12 minutes spent on the phone with Duke Energy customer service shed no light on how — or if — c [...]

Crumbling ceilings. Failing air conditioning and heating systems. Broken down school buses. Mold inf [...]

This story has been updated with comments from Jim Womack, who did not respond earlier to questions. [...]

For the 18 months, Gary Brown has been traveling through northeastern North Carolina like an itinera [...]

Last week, the General Assembly announced which legislators will serve on the Joint Legislative Task [...]

The latest effort in Washington to repeal and not actually replace the Affordable Care Act has a dif [...]

Conservative group “reviewing” bigoted attacks; funding from major NC corporations implicated Nearly [...]

5---number of days since Senators Bill Cassidy and Lindsey Graham unveiled a new proposal to repeal [...]

Featured | Special Projects

NC Budget 2017
The maze of the NC Budget is complex. Follow the stories to follow the money.
Read more


NC Redistricting 2017
New map, new districts, new lawmakers. Here’s what you need to know about gerrymandering in NC.
Read more