Who will get hurt by public sector layoffs

The Great Recession was bad, but the COVID-19 recession will be worse, especially in New York City. Unless action is taken now, workers who have historically gained the most from public sector employment will be hurt the most. Mayor de Blasio is reportedly gearing up for a “painfully real” round of 22,000 public sector layoffs if the federal government doesn’t deliver aid, a reality that looks increasingly likely.

Now is the time for the mayor, who claims to care deeply about equity, to carefully consider the unequal impacts of public sector layoffs.

We can learn some lessons from the past. In 2008, tax revenues took a nosedive. State and local governments had to make major budget cuts. With funding in free fall, political constraints against raising taxes, and a growing number of political attacks against public sector employees, many states and municipalities resorted to drastic measures. By 2011, approximately 40% of state and local governments reported layoffs.

The effects of public sector decline were uneven during the Great Recession because women, particularly Black women, are overrepresented in the public sector.

But that’s not all we learned. My research has uncovered a second disadvantage for women and Black workers when the public sector sheds jobs: They are substantially more likely than other public sector workers to become unemployed. During the Great Recession, the protective effect of working in the public sector decreased substantially for women and Black workers, whereas white men in the public sector were relatively insulated from the threat of layoffs.

Isolating causal factors is difficult with survey data; however, there is suggestive evidence that women and Black workers are more likely to be laid off when the layoffs are triggered by an immediate reduction in funding. When suddenly presented with a high number of layoff decisions, there is less time to develop and implement due process oversight.

According to the Economic Policy Institute, between 2007 and 2011, the decrease in Black public sector employment was more than 30% greater than the decrease in white public sector employment. More than 177,000 Black workers lost their state or local government job during the Great Recession.

My research finds that race and gender differences in public sector job loss during the Great Recession persist, even when I control for other factors associated with labor force attachment, including age and education. These losses also have long-term consequences. After becoming unemployed during the Great Recession, Black women were less likely than white women to find public sector employment within a month and more likely to leave the labor force altogether.

The latest data do not look promising. According to the Current Population Survey, the data used to calculate the U.S. unemployment rate, women in state and local governments are losing their jobs faster than men. Among the public sector workers surveyed between February and July, the increase in unemployment for women was double the increase for men. As of July, approximately one in 10 women who previously worked in the public sector were unemployed; for Black women, the rate is nearly 12%.

While we need to wait for more data to draw broad conclusions, what we’re seeing in the monthly data should concern us. In July, teachers made up more than half of the unemployed local government worker sample — even though they’re only a third of the local government workforce. Police officers made up less than 5% of that unemployed sample, despite being more than 10% of the local government workforce.

By prioritizing police officers over teachers, the current contraction of the U.S. public sector is disproportionately harming women, particularly Black women. The Senate has yet to take up any House proposal that includes support for state and local agencies. As the mayor and New York City agencies prepare their lists of employees to cut, will they take steps to mitigate or perpetuate gender and racial inequality?

Laird is an assistant professor at Lehman College, CUNY.