Comparing Private and Public Sector Job Growth

For every government job in America, there are 4.7 jobs in the private sector. That ratio gives you a sense of how much bigger the private sector is than the public sector. And when it comes to jobs added to the national economy since 2010, the private sector also trumps government. In fact, it’s not even close.

As we chart below using EMSI’s 2012.3 data on salaried workers in the U.S., private industries have added more than 3.9 million estimated jobs from 2010 to 2012. The 4% increase has been fueled by the return of manufacturing, the continuing growth of health care, and emergence of oil & gas jobs, to name a few hot sectors.

During the same timeframe, the public sector has contracted by nearly half a million jobs (a 2% decrease).

The private sector’s healthy growth the last two-plus years comes after it lost 6.8 million jobs from 2008 to 2010 — a hole that it’s not close to climbing out of yet. The public sector, meanwhile, added 31,735 jobs during and immediately after the recession.

A Detailed Look At Government Losses

The following table shows where job losses have been most acute since 2010 inside the government sector. Again, these numbers come from EMSI’s latest dataset, which is a combination of more than 90 data sources.

Note: EMSI’s 2012 job numbers are estimates based on historic and projected data.

The losses have been widespread throughout the different areas of government. Here are a few takeaways from the table:

• Elementary and secondary schools (local government) have taken the biggest overall hit, shedding an estimated 208,071 jobs nationally. 
• State government (-107,493) and local government (-96,164) have also bled jobs.
• Colleges, universities, and professional schools (state government) is the only detailed industry in the government sphere to grow by more than 1%.

Change in Concentration of Government Jobs by State

Now that we’ve looked at detailed government industries at the national level, let’s turn to which states have seen the biggest change in their relative concentration of workers in the public sector. This analysis allows us to contextualize employment data. The raw jobs data from EMSI tells us, for instance, that Texas gained 77,587 government jobs from 2008-2010, then lost an estimated 82,880 from 2010-2012. But Texas has the second-largest population (and the second-largest workforce) in the nation, so its job growth and total job figures are naturally going to be larger than those in smaller states.

With that said, how does the Lonestar State stack up to other states based on the proportion of government jobs to the total workforce? Texas’ concentration was slightly above average in 2008 (1.03), but has since fallen to the same as the national proportion (1.00).

Wyoming, on the other hand, is 51% more concentrated in public-sector jobs per capita than the nation — the fourth-highest mark in the nation. And it’s seen the largest growth in concentration since 2008 (from 1.39 to 1.51). The second-biggest jump belongs to Colorado (from 1.02 to 1.08), followed by West Virginia, Mississippi, and North Carolina.

Easily the largest decrease in the concentration of government jobs from 2008 to 2012 has occurred in North Dakota, which has the most vibrant and fastest-growing economy in the nation. North Dakota went from being 23% more concentrated per capita than the nation in ’08 to just 10% more concentrated. As the oil and gas boom brings more people from out of the state for work and puts more stress on services, it wouldn’t be surprising to see North Dakota’s government job numbers increase.

Lastly, what’s a post on the public sector without a mention of Washington, D.C.? It’s more than twice as concentrated with government jobs than the nation (2.01), but like Texas and North Dakota, D.C.’s public-sector concentration has waned since the recession.

Interested in private/public sector employment data for your state or region? Contact Josh Wright ([email protected]).

Data and analysis from this report came from Analyst, EMSI’s web-based labor market tool. Follow us on Twitter @desktopecon.