Greek Corrective

To read the papers, it would appear that just about everybody in Greece is working for the public sector. I found some numbers for Greek public sector employment on the Philip Atticus’ blog (here) for 2011, citing ELSTAT, the country’s National Statistics Organisation. According to these numbers, public sector employment in Greece was 18 percent of the total workforce—which compares to 16.6 percent for the United States in 2011, taking December 2011 as the benchmark. Not all that different.

I made efforts to look at other sources of data as well. One is the Organization for Economic Cooperation and Development. OECD presents data for the period 1993 through 2009, identifying one category as “Public Administration and Defense”; that category, much like the equivalent U.S. data from the Bureau of Labor Statistics, excludes the armed forces. The numbers I found (link, p. 158) are significantly lower than those cited by Atticus: In 1993 public sector employment was 7.2 percent of the total labor force, in 2009 8.6 percent.

In any case, the Greek economy looks quite similar to others in the developed sector. Agriculture represents 12 percent of total employment, which is fairly high (and compares to our own at 1.6%), industry at 20 percent (30.1% in our case), and services at 68 percent (68.3% in the United States).

I tried to find confirming data on ELSTAT myself, but the site is all in Greek—and Google’s translation service failed me when I had penetrated down to the really substantive statistical presentations.  

Jobs by Sector, June-July 2011

If we look sector by sector, in the June to July period this year all gains have been in the private sector and the largest offsetting losses in the public: total gains of 154,000 jobs were offset by 37,000 jobs lost in government, 4,000 in the finance sector and 1,000 in Information, the last two both private sector activities.

The private sector with the largest gains was Education and Health Services. The large gains within this sector came in the Health Services category. That category (and occupations within it) are almost guaranteed growth in the foreseeable future because the huge Baby Boom segment of the population is aging. Professional and Business Services came in second, with increases of 34,000 jobs. This can be interpreted as a weakness, rather than as a strength, in the economy: industry is hiring services, not adding to its own employment. Weak performance by Construction and Manufacturing underlines this weakness.

General weakness in economic activity, exacerbated by the debt limit crisis which certainly sapped confidence, is reflected in the job losses experienced by the finance sector, shedding jobs for the second month in a row. BLS reported 15,000 jobs lost in that sector in June—which it adjusted further downward, to 18,000 this month. July’s losses of 4,000 may also be revised downward in the August release.

Within the government sector, the Federal government gained jobs (+2,000). The largest losses came in state government (-23,000). Of the negative job change at the local level (16,000 jobs lost) 12,000, thus most, came from education at the local level. Have we had a sudden die-off of school-age children? Was there a huge surge in our “output” per teacher?

Public Sector Employment

As I showed earlier this month here, our elected leaders caused heavy lay-offs in the public sector. This comes about despite the mantra of Jobs, Jobs, Jobs—because coherent, rational policies are shredding and blowing away in the wind. Budgets must be cut everywhere because tax increases have become the ultimate sin in politics. Therefore the first task in Job One, which our elected officials think is Job Creation is, in fact, Job Destruction at the local level—which is where most of the public jobs actually are.

Anecdotal evidence, in the form of news reports, has since amply documented the statistical evidence I presented on June 4. Yesterday the papers announced huge layoffs and salary cuts in the Detroit Public School System. Today’s New York Times projects the likely loss of 7,500 public jobs in Connecticut because the unions there decided not to disembowel themselves to please the tax cutters. Another story, also page one, announces that in New York state and elsewhere, schools are sacrificing librarians to stay within their shrinking budgets. I expect more red lines when next I produce my chart on June’s employment situation by sector.

The facts are that the bulk of the much-derided public sector is (1) local and (2) consists of educational services. As of May 2011, all told we had 22.1 million public employees, representing 17 percent of all employment. Of these 22.1 million 64 percent work at the local level—and 56 percent of them are in education.

Of the 22.1 million workers in the public sector, nearly half, 10.9 million, work in education or in the postal system. If we look at the state and local employment only, 10.3 million of 19.3 million (53%) work in education. And if we look closely at the 9 million who are not in education, we discover that most of them work in such useful and necessary functions as law enforcement, water and sewage systems, and other jobs at least as valuable as manufacturing soups or cell phones. Education represents 47 percent of all public sector employment—and if we add in postal services, the percent rises to 49.

Topsy-turvy. Teachers, librarians, janitors working at schools, school bus drivers, special education experts, are paying for the sins of speculators, hedge-fund traders, and other lords of the universe who—instead of going on pilgrimage to Rome in sackcloth are, based on other anecdotal evidence, once more pulling down monstrous bonuses.

It is said that the public employment created during the Depression by FDR did not really turn things around. World War II, however, did. We have huge expenditures on war today, of course, but these wars are not having the same effect. Why? We are not taxing the public to pay for them—and instead of signaling hope with publicly funded jobs, we are radicalizing those sectors of the working world that attract the socially-motivated, our real patriots.