This morning lots of headlines said no jobs had been added to the economy in August. But that’s not the whole story. Matt Yglesias writes,
Looks like we had 17,000 new private sector jobs in August, which were 100 percent offset by 17,000 lost jobs in the public sector.
The striking zero result should galvanize minds, but itâ€™s worth noting that this has been the trend all year. The public sector has been steadily shrinking. According to the conservative theory of the economy, when the public sector shrinks that should super-charge the private sector. Whatâ€™s happened in the real world has been that public sector shrinkage has simply been paired with anemic private sector growth. This is what Iâ€™ve called â€œThe Conservative Recovery.â€
As Matt goes on to say, in the whacky world of Republican economics, laying off public workers is supposed to grow jobs in the private sector. I’ve never quite understood how that’s supposed to work, though. I think it’s something like the tooth fairy leaving you money when you lose a tooth.
Matt is right that the loss of government jobs is what’s dragging down overall job growth. Steve Benen wrote almost a year ago,
The monthly employment picture from the Bureau of Labor Statistics is starting to look repetitious. September’s totals were published this morning, and the new report looks a lot like the last few reports — the private sector is slowly adding jobs, but we can’t get our head above water because of the loss in the public sector.