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Government Job Rise May Be Misleading

August 14, 2013

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Inside Florida's job report for June was a bit of data that economists
and public officials haven't seen much in the last few years.

Public-sector employment at the state and local level increased by 7,300,
hitting its highest point since June 2012. Government hiring, in fact, accounted
for almost 80 percent of the 9,300 total new jobs reported by officials.

About 3,200 of those positions were at the local level. The remaining 4,100 were
new jobs created by state government, according to Florida's Department of
Economic Opportunity.

The 7,300-job increase was the biggest monthly gain in government hiring in at
least three years, but economists warn that the number carries a significant
caveat.

It does not guarantee, they said, that local and state governments actually
added that many new jobs. More likely, it is the result of some statistical
modeling designed to account for regular, seasonal changes in hiring.

May and June, for example, typically see large numbers of public-sector
employees -- teachers, mostly -- fall off the radar when schools let out. June,
for example, saw government jobs fall by 85,000 on a not-seasonally adjusted
basis.

But since that loss is a regular, recurring phenomenon, economists adjust the
figure to account for it. When those seasonal adjustments are applied, they
suggest state and local governments added workers.

"Usually, the government sector -- schools mostly -- falls a little more than it
did this year," said Wells Fargo economist Mark Vitner. "And so you can get
these numbers that make it look like an increase."

University of Central Florida economist Sean Snaith pointed out that the numbers
are estimates, not actual headcounts, so some error is likely. But, said Snaith,
it's "the best data we have in the short run."

The long-term numbers are much clearer: Over the year -- June 2012 through June
2013 -- Florida has shed 700 total government jobs. Since January 2011, it has
eliminated more than 24,000 public-sector positions.

Over the same period, the private sector has added more than 333,000 jobs,
according to the Governor's Office.

This year, the public sector appears to be faring better. In four of the six
monthly job reports, government hiring in Florida increased modestly on a
month-to-month basis. The Wall Street Journal reported recently that nationally,
local governments added employees in seven of the past eight months.

Ken Small, economist for the Florida League of Cities, said local governments
are benefiting from a rebound in property values.

"I'm not really seeing a big burst in new construction, but I do think the
economy has turned the corner," Small said. "I'm optimistic the indicators are
going the right direction."

jstratton@tribune.com or 407-420-5379

___

(c)2013 The Orlando Sentinel (Orlando, Fla.)

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Source: Copyright Orlando Sentinel 2013

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