links for 2011-07-11

  • The metropolitan data show that government is associated with economic performance since the beginning of the recession. Although we do not have data on government spending at the metropolitan level, data on government employment make the point. The metropolitan areas that suffered least since the beginning of the recession typically had increases in the number of government jobs (federal, state, and local combined). Those that suffered the most typically lost government jobs. Yet government job cuts have become widespread even as total employment has grown during the recovery. These cuts have contributed to the slow pace of the recovery.

    Nearly all the metropolitan areas whose economies suffered the least since the start of the Great Recession had increases in government employment, while most of those that suffered the most lost government jobs.