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Those ‘bad’ numbers

Last Friday’s employment report for September brought some sobering numbers. The economy lost 95,000 non-farm jobs, while the jobless rate remained stuck at 9.6 percent.

It was hardly news that would help Democrats in November’s midterm congressional elections. Indeed, the report at a glance seemed to signal an economy shifting into reverse.

A closer look at the data, however, reveals something else at work. In fact, critics of big government who scrutinize the numbers should like what they see.

According to the Bureau of Labor Statistics, the private sector actually added jobs in September-a total of 64,000. The employment decline stemmed solely from a much larger decrease in government positions. All told, 159,000 public-sector jobs disappeared.

A sizable chunk of these–more than 75,000–were temporary census positions. But cuts to the federal payroll were outpaced by the loss of 83,000 state and local government positions.

BLS data show that local governments have not shed jobs at such a fast rate since the recession of the early 1980s.

The local picture reflects this trend. Total non-farm private-sector employment in metropolitan Rochester is trending upward, except for the hard-hit manufacturing and construction sectors. But since summer, local government employment has declined sharply.

With more top-down cuts in government expenditures likely, the toll of public-sector jobs almost certainly will increase.

Some would argue that more should be done to protect the jobs of public-sector workers. In New York, with its over-the-top tax burden, the drumbeat for spending cuts has been loudest.

But let’s be honest: Those cuts will be painful and won’t be over soon. Expect more "bad" employment reports.

To know if the economy is continuing to heal, however, keep focused on private-sector job growth. In the last three months, the growth rate has lagged the pace recorded early this year, but it’s still better than the period in between.

In short, a case for optimism can be made–even while admitting that the road back will be rocky.

10/15/10 (c) 2010 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or e-mail rbj@rbj.net.


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