And half those jobs would be in the private sector.
The EPI figures that state and local governments cut 627,000 jobs since June 2009. It also figures 505,000 public sector jobs should have been created since then to make up for population gain.
Now here's how cutting public sector jobs hurts private sector jobs:
...public-sector job cuts also cause job loss in the private sector, for a couple of reasons. First ...Firefighters need trucks and hoses, police officers need cars and radios, and teachers need books and desks. When public-sector jobs are lost, it stands to reason that the inputs into these jobs will fall as well, and indeed research shows that for every public-sector job lost, roughly 0.43 supplier jobs are lost.
Second, the economic “multiplier” of state and local spending (not including transfer payments) is large – around 1.24. This means that for every dollar cut in salary and supplies of public-sector workers, another $0.24 is lost in purchasing power throughout the rest of the economy. Teachers and firefighters stop going to restaurants and buying cars if they’re laid off, which reduces demand for waitstaff and autoworkers and so on. Add these two influences together (supplier jobs and jobs supported by this multiplier impact) and roughly 0.67 private sector jobs are lost for every public sector job cut. This means that the public sector being down 1.1 million jobs has likely cost the private sector 1.1 million*0.67 = 751,000 jobs.
Finally, cuts in transfer payments (such as food stamps, unemployment insurance) cost jobs for much the same reason.
EPI concludes:
To reduce these job losses and the suffering for American families they cause, Congress should provide aid to state and local governments to keep austerity in that sector from continuing to weigh down the recovery.Better than giving the money to the banks.
