It’s unremarkable for President Obama’s opponents to deride his career in public service; ever since Ronald Reagan ran into term limits, conservatives have insisted that business experience is more important in the White House than intellect, vision, and policy knowledge. But conservative reverence for the business world and disdain for government work is so dogmatic today that Republicans often claim that Obama’s policies have primarily, or even only, benefitted the public sector at the expense of the private economy. This is nonsense. The primary difference between the Obama recovery and the previous three post-recession economies, other than the depth of the crater Wall Street’s actions created, is that where government payrolls expanded under Presidents Bush, Clinton, and Reagan, the public sector has shed well over half a million jobs since the end of the recession. Meanwhile, private-sector hiring has been far more consistent than conservatives would have you believe.
3.3 Million New Private-Sector Jobs Since Recession, But 640,000 Government Employees Out Of Work
Recession Officially Ran From December 2007 To June 2009, Making It The Longest Since World War II. From the National Bureau of Economic Research: “The Business Cycle Dating Committee of the National Bureau of Economic Research met yesterday by conference call. At its meeting, the committee determined that a trough in business activity occurred in the U.S. economy in June 2009. The trough marks the end of the recession that began in December 2007 and the beginning of an expansion. The recession lasted 18 months, which makes it the longest of any recession since World War II. Previously the longest postwar recessions were those of 1973-75 and 1981-82, both of which lasted 16 months. In determining that a trough occurred in June 2009, the committee did not conclude that economic conditions since that month have been favorable or that the economy has returned to operating at normal capacity. Rather, the committee determined only that the recession ended and a recovery began in that month.” [NBER.org, 9/20/10]
- Recession Resulted In 8.3 Million Job Losses. According to the Associated Press, “the Great Recession killed 8.3 million jobs, compared with 1.6 million lost in the 2001 recession.” [Associated Press via Yahoo! News, 5/4/12]
Bush Recession Was So Severe That Economy Was Still Shedding Over Three-Quarters Of A Million Jobs Per Month Through First Few Months Of President Obama’s Term. According to the Bureau of Labor Statistics, the economy shed 839,000 jobs in January 2009, 725,000 in February 2009, 787,000 in March 2009, and 802,000 in April 2009, for a four-month average of 788,250 lost jobs per month. [BLS.gov, accessed 5/3/12]
Since The Recession Ended In June 2009, The Private Sector Has Added 3.3 Million Jobs While Public-Sector Employment Has Fallen By Over 640,000. According to the Bureau of Labor Statistics, there were 107,933,000 private-sector jobs in June 2009, and 111,317,000 private-sector jobs in July 2012, an increase of 3,384,000 jobs. The BLS also reports that there were 22,570,000 Americans working in the public sector in June 2009, and 21,928,000 working in the public sector in July 2012, a decrease of 642,000 jobs. The private-sector gains and public-sector losses add up to a total increase of 2,742,000 jobs.
The following chart shows the cumulative private-sector job gains and public-sector job losses since the recession officially ended in June 2009:
[BLS.gov, accessed 8/3/12; BLS.gov, accessed 8/3/12; NBER.org, 9/20/10]
- Conservative AEI: The Public Sector Is Shrinking, But Private-Sector Growth Is Above Average. From American Enterprise Institute scholar Mark J. Perry: “In the second quarter of 2012, ‘public sector GDP’ decreased -1.44%, and that was the eighth straight quarter of negative growth for total government spending, averaging -2.88% per quarter over the last two years. In contrast, there have been 12 consecutive quarters of positive growth for private sector GDP averaging 3.07% per quarter in the three years since the recession ended, which is slightly higher than the 2.8% average growth rate in private real GDP over the last 25 years.” [AEI-Ideas.org, 7/31/12]
- GOP-Favored “Government Downsizing” Has Been “A Drag” On Job Growth. From the Associated Press: “Conservative Republicans have long clamored for government downsizing. They’re starting to get it — by default. Crippled by plunging tax revenues, state and local governments have shed over a half million jobs since the recession began in December 2007. And, after adding jobs early in the downturn, the federal government is now cutting them as well. States cut 49,000 jobs over the past year and localities 210,000, according to an analysis of Labor Department statistics. There are 30,000 fewer federal workers now than a year ago — including 5,300 Postal Service jobs canceled last month. By contrast, private-sector jobs have increased by 1.6 million over the past 12 months. But the state, local and federal job losses have become a drag on efforts to nudge the nation’s unemployment rate down from its painfully high 9.1 percent.” [Associated Press, 10/25/11]
The Private Sector Has Added 4.5 Million Jobs Over 29 Consecutive Months Of Private-Sector Growth. The following chart shows the monthly change in private-sector jobs dating back to January 2008.
President Obama’s Recovery Dragged Down By Government Layoffs
Previous Recoveries Were Bolstered By Public-Sector Growth. The following chart, based on BLS data, shows the cumulative change in public-sector employment in the first two years of the Obama recovery and the three most recent previous recoveries:
[BLS.gov, accessed 4/10/12]
In The Two-Year Period After June 2009, Public-Sector Employment Fell By 458,000 Workers While The Private Sector Added 1.2 Million Jobs. According to the Bureau of Labor Statistics, there were 107,933,000 private-sector jobs in June 2009, and 109,199,000 private-sector jobs in June 2011, an increase of 1,266,000 jobs. The BLS also reports that there were 22,570,000 Americans working in the public sector in June 2009, and 22,112,000 working in the public sector in June 2011, a decrease of 458,000 jobs. [BLS.gov, accessed 4/10/12; BLS.gov, accessed 4/10/12]
President Bush’s Recovery Was Far More Government-Oriented Than President Obama’s. From Talking Points Memo, which used Inauguration Day rather than the official ends of the two recessions as the starting point for their comparison:
We’ve adjusted these to reflect percent change, to account for population growth. The basic story is that Obama’s private-sector recovery has outpaced Bush’s, but Obama’s been hobbled by government cutbacks that Bush never faced. Quite the opposite, in fact.
To date, Obama’s overseen a cumulative loss 274,000 private-sector jobs. If the recent job-growth trend continues, Obama will enter positive territory in the next month or two. By this point in his first term, Bush had overseen over 2.7 million private-sector jobs losses. By the end of his first term, that had rebounded to a cumulative loss of 913,000 jobs. [Talking Points Memo, 3/21/12]
2001 Recession: Government Payroll Growth Dulled Pain Of A Million Lost Private-Sector Jobs
Economy Was In Recession From March To November Of 2001. From the National Bureau of Economic Research: “The Business Cycle Dating Committee of the National Bureau of Economic Research met yesterday. At its meeting, the committee determined that a trough in business activity occurred in the U.S. economy in November 2001. The trough marks the end of the recession that began in March 2001 and the beginning of an expansion. The recession lasted 8 months, which is slightly less than average for recessions since World War II. In determining that a trough occurred in November 2001, the committee did not conclude that economic conditions since that month have been favorable or that the economy has returned to operating at normal capacity. Rather, the committee determined only that the recession ended and a recovery began in that month.” [NBER.org, 6/17/03]
In The Two-Year Period After November 2001, Public-Sector Employment Rose By 200,000 While The Private Sector Shed 1,000,000 Jobs. According to the Bureau of Labor Statistics, there were 109,572,000 private-sector jobs in November 2001, and 108,605,000 private-sector jobs in November 2003, a decrease of 967,000 jobs. The BLS also reports that there were 21,326,000 Americans working in the public sector in November 2001, and 21,535,000 public-sector workers in November 2003, an increase of 209,000 government jobs. [BLS.gov, accessed 4/10/12; BLS.gov, accessed 4/10/12]
Early ‘90s Recession: Government Hiring Pushed Two-Year Jobs Recovery Total Over 1 Million
Recession Ran From July 1990 To March 1991. From the National Bureau of Economic Research: “The Business Cycle Dating Committee of the National Bureau of Economic Research met by conference call yesterday. The committee maintains a chronology of the U.S. business cycle that is widely used in the analysis of business conditions. In its meeting, the committee determined that the U.S. economy reached a trough of activity in March 1991. Previously, the committee had determined that the economy reached a peak of activity in July 1990. The eight-month period between July 1990 and March 1991 is a recession in the NBER’s chronology. The committee thus determined that the recession ended in March 1991 and that an expansion began at that time.” [NBER.org, 12/22/92]
In Two-Year Period Following Recession’s End, The Private Sector Added Nearly 1 Million Jobs While Government Payrolls Expanded By 419,000 Jobs. According to the Bureau of Labor Statistics, there were 18,488,000 public-sector workers in March 1991, and 18,907,000 in March 1993, an increase of 419,000 jobs. The BLS also reports there were 90,047,000 private-sector workers in March 1991, and 91,010,000 in March 1993, an increase of 963,000 jobs. [BLS.gov, accessed 4/10/12; BLS.gov, accessed 4/10/12]
Reagan Recovery Included Large Increase In Government Payrolls
Recession Ran From July 1981 To November 1982. According to the National Bureau of Economic Research, the economy hit a peak in July 1981 and did not reach a trough until November 1982, at which point an expansion began. [NBER.org, accessed 4/10/12]
In Two-Year Period Following Recession’s End, Private Sector Added 6.8 Million Jobs While Public-Sector Payrolls Grew By 300,000 Jobs. According to the Bureau of Labor Statistics, there were 15,977,000 government workers in November 1982, and 16,311,000 in November 1984, an increase of 334,000 public-sector jobs. The BLS also reports that private-sector employment grew from 72,793,000 in November 1982 to 79,649,000 in November 1984, an increase of 6,856,000 jobs. [BLS.gov, accessed 4/10/12; BLS.gov, accessed 4/10/12]
As Public-Sector Losses Kept Total Job Growth Down, Conservatives Claimed The Opposite
Rep. John Shimkus (R-IL): Private Employment Down, Government Jobs Up Under Obama. In a post at RedCounty.com, Rep. Shimkus wrote: “While private sector employment has declined under President Obama’s watch, the president’s record on government job creation is unmatched for his time in office. In the wake of the federal takeover of health insurance, the massive market interventions of Dodd-Frank, and the EPA’s continued attempts to implement a cap-and-tax scheme against the will of Congress – President Obama has created plenty of work for federal regulators. To put this enormous expansion of government into perspective, if the federal government’s regulatory operation were a business it would be the third largest in terms of employees.” [Rep. Shimkus Post, RedCounty.com, 8/25/11]
Then-Presidential Candidate Tim Pawlenty Promised To “Get Back To The Premise That We’re Gonna Grow The Private Economy Not The Government Economy.” On Fox News Sunday, Pawlenty said: “Chris, [my economic plan] would unleash economic growth and job growth in this country. It would get back to the premise that we’re going to grow the private economy, not the government economy. And it shows leadership and it puts specific proposals on the table. I wish President Obama would do that, instead of leading from behind and refusing to address the real issues facing our economy, including spending reform. He basically waits for people like Congressman Ryan and others to lead and then he follows. That’s not what a president should do. The president should bring forward the real challenges to this country, put out real solutions, that’s what I would have done. This plan, by the way, is one that gets back to the notion that we need to have a pro-growth economy focused on private sector job growth.” [Fox News Sunday, 6/12/11]
Sen. Shelby (R-AL): “We’ve Grown The Government, But We Haven’t Grown The Economy.” On ABC’s This Week, Sen. Richard Shelby said: “Well, I believe that stimulus basically doesn’t work, for the most part. We’ve tried that. I think what we’ve got to do is create the conditions, tax reform, which we could do and we haven’t, incentives for manufacturing. We’ve lost millions of jobs in manufacturing. And say this a new day. We’ve got to do it. We’ve got to be buoyant about where we’re going. We’ve got to grow this economy. The market grows the economy. Government — we’ve grown the government, but we haven’t grown the economy, and we better be mindful of that.” [This Week, 6/12/11]
Claim That President Obama Favors Government Over Private Sector Is Frequent Element Of Mitt Romney’s Campaign Rhetoric. From the Huffington Post:
After Barack Obama signed the JOBS Act into law on Thursday, House Majority Leader Eric Cantor (R-Va.) made comments that appeared to contradict one of Mitt Romney’s standby attack lines against the president.
“The president said today that he’s always believed that it’s the private sector that is the job generator in this country,” Cantor told reporters, according to MSNBC’s First Read. “I agree with him, and I think most Americans agree with him.”
That statement is at odds with Romney’s frequent assertion that Obama thinks of government, not business, as fueling economic growth.
During his Wisconsin victory speech last Tuesday, for example, Romney said that the president’s policies would hurt the private sector.
“When the president attacks business and when his policies make it more difficult for businesses to grow and prosper, he is also attacking the very communities he wanted to help,” Romney said.
And at a rally in Wisconsin on Friday, Romney claimed that “In Barack Obama’s government-centered society, the government must do more because the economy is doomed to do less. When you attack business and vilify success, you will have less business and less success.”
The criticism isn’t new. In December, Romney said that “Obama believes government should create equal outcomes.” [Huffington Post, 4/5/12]
- Cantor Said Last Summer That Obama “Is Not Interested In Focusing On Private Sector Growth” So Much As “A Continued Expansion Of Government.” From The Hill: “House Majority Leader Eric Cantor (R-Va.) said Monday morning that the House Republican plan to boost job creation through deregulation is needed because the Obama administration has shown it is ‘not interested’ in creating jobs in the private sector. ‘I think the administration has … already demonstrated that it is not interested in focusing on private sector growth,’ Cantor said Monday on Fox News. ‘The record has been thus far, in this administration, a continued expansion of government, continued grabs at trying to tell people who want to go out and invest and create a profit that maybe they’ve done so, done enough already, and that we need to take that money and put it elsewhere.’” [The Hill, 8/29/11]
As Far Back As Early 2010, Senate Minority Leader Was Claiming Stimulus Only Saved Government Jobs, Ignored Private Sector. On the February 21, 2010, edition of Fox News Sunday, Sen. Mitch McConnell (R-KY) said: “The stimulus probably did save state government jobs, and you’re going to have a couple of governors on here, and I’m sure they appreciate it — the federal government borrowing money from our grandchildren to send it down to them to make their employment situation with state employees less severe. But Chris, if you look at the private sector, the private sector where job generation really needs to occur, the stimulus was sold to keep unemployment at 8 percent. It’s now almost 10 percent, and in my state it’s almost 11 percent. It has done little or nothing to stimulate private sector employment. […] Well, that’s their argument. And I’m sure that if you spend a trillion dollars on government jobs you’ll save some government jobs. What I’m talking about is the way you get this economy going again is in the private sector. And there’s very little — scant — evidence that the stimulus package created any private sector jobs. It probably did save a lot of state government jobs, and I’m sure the governors were grateful to have it.” [Fox News Sunday, 2/21/10]