OLMIS

by Katharine Williams
Published Nov-19-2012

Distribution and Composition of Government Jobs The Great Recession and Public-Sector Employment Trends Conclusion

Government employment made up about 18 percent of Oregon's workforce in 2011, representing more than one-quarter million jobs. From eastern to western Oregon, and everywhere in between, the public sector employs teachers, firemen, lawyers, and many others; even the occasional employment economist.

Oregon has 11 counties that are identified as metropolitan areas due to high population and job density. These include Benton (Corvallis MSA); Clackamas, Columbia, Multnomah, Washington, and Yamhill (Oregon portion of Portland-Vancouver-Hillsboro MSA); Deschutes (Bend MSA); Jackson (Medford MSA); Lane (Eugene-Springfield MSA); and Marion and Polk (Salem MSA). The remaining counties are considered non-metro.

Government payrolls pumped $12.7 billion dollars into Oregon's economy in 2011, more than any individual private-sector industry. Most of this income was distributed in metro areas, where the average annual wage was $48,591. About 20 percent of these wages were earned in non-metro counties, where government jobs paid $39,250 per year, on average.

A majority of government workers were employed in metro areas in 2011, though nearly one out of four jobs were in non-metro counties. This balance played out roughly the same at the local and federal government levels, while state government employment was more heavily distributed in urban areas (82%). When it comes to number of establishments, however, about 41 percent resided in rural locales.

As shown in Figure 1, the Portland and Eugene-Springfield Metro areas have the greatest number of government jobs. No big surprise there, as these regions are home to large public universities as well as many state and federal offices.

Portland-based Oregon Health Sciences University is the state's largest public employer, with more than 13,000 workers on payroll. The classification of home health workers as state employees, as of 2005, results in this group being the second-largest at nearly 12,000.

Oregon State University and the University of Oregon also make the top 10 list of largest government employers, with around 5,000 jobs each. Given the size of these institutions, in addition to local K-12 schools, it's not surprising that four out of every 10 government jobs are in education. Along with health services, this industry group comprised the largest share of government employment in 2011, as shown in Table 1. Public administration comprised the next largest share of government employment, as one might expect.

When broken down by area, government employment comprises a considerably larger share of non-metro jobs compared with metro jobs: 22.2 percent and 16.0 percent, respectively. The difference is most apparent in education and health services, which had the widest gap: 45.2 percent for rural areas versus 37.0 percent for urban areas in 2011. The industries with the next greatest metro to non-metro government employment differences were leisure and hospitality; natural resources and mining; and manufacturing.

These numbers exclude students employed by state colleges; elected officials; and certain part-time, temporary, or irregular government workers.

Government budget cycles impact employment trends, especially during recessions. As the housing bubble burst in 2007, real estate took a huge hit and with it, funding from property tax revenues. Due to the increase in demand for social and employment services during the recession, state government employment rose.

Local workers were cut sooner than other levels of government, although stimulus spending initially helped to ease job losses. The 2010 Census also provided several thousand temporary federal jobs, which account for some of the employment build-up seen between 2009 and 2010. These positions helped to briefly offset other federal government losses in the postal service, which had been shedding jobs pretty steadily through the recession and afterward, at an average annual pace of 330 between 2007 and 2011.

As the officially defined end to the recession passed in 2009, and stimulus funding came to an end in 2011, public-sector employment plunged. As shown in Graph 1, rural areas were hardest hit during this time: the number of public-sector jobs in non-metro counties dropped by 2.7 percent between 2010 and 2011. By comparison, about 1.8 percent of government jobs in metro counties were lost over that year.

Overall, since 2005, government employment has grown 3.4 percent. However, there is a stark difference in net growth when it comes to location. Metro area public employment rose 5.3 percent between 2005 and 2011, whereas non-metro areas lost 2.3 percent of government jobs.

Government jobs provide important public services to urban and rural areas alike, but the economic impact of these jobs is likely greater in non-metro counties. Although metro areas have three times more government jobs and higher-than-average wages, public employment makes up a greater proportion of all jobs in rural counties, and provides the second highest industry wage (after manufacturing) in these areas. However, following an economic downturn, government jobs in metro areas tend to fare better than those in rural areas, as seen in the aftermath of the 2007 to 2009 recession.