GROWTH INDUSTRY

June 8, 2010

It's well known by now that the past few years have seen a reversal of fortune between the realms of private enterprise and government.  The recession has cut millions of jobs from the private sector while the public sector has continued to expand.  Nowhere is the trend clearer than in California, a state where the public and private sectors have had a boom and bust -- at roughly the same time, says Investor's Business Daily (IBD). 

  • Since 2004, the state government payroll has jumped by more than 13 percent, from 313,684 to 356,436.
  • According to Bureau of Labor Statistics data, total public employment has also risen in the state by just over 4 percent from 2004 through 2009 (national figures are similar).
  • During that time, the state's total private payrolls have slumped by 4.6 percent, shedding more than 550,000 jobs. 

Up to a point, these numbers should come as no surprise, says IBD.  Civil-service jobs are much more secure than the typical job at a private company.  It's nice to have one in a recession.  But that doesn't explain the boom in state jobs -- which started when the economy was doing well and continued into the downturn. 

Taking a closer look at the state payroll numbers, you can see trends that make little sense when compared with actual needs, says IBD: 

  • Some 17,000 of the more than 42,000 jobs added since 2004 have been in the state's prison and youth authority system.
  • But the increase in the actual prison population has been modest, from 163,634 at the end of 2004 to 168,905 at the end of 2009, a rise of just 3 percent. 

Thousands of prison guards have been added, but to what end?  Workload doesn't answer the question, though politics might.  The prison guard union is one of the most powerful forces in Sacramento, with strong influence in both parties.  It has succeeded in making California guards by far the highest-paid in the nation, and, like any union, it seeks to increase jobs available to its members. 

Source: Editorial, "Growth Industry," Investor's Business Daily, June 7, 2010. 

For text:

http://www.investors.com/NewsAndAnalysis/Article/536552/201006071833/Growth-Industry.aspx

 

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