Kansas private sector jobs lag government jobs

Government jobs in Kansas have been growing at the expense of private sector jobs.

Some mistakenly say that government employees are good for the economy, because their paychecks pump up the economy. But this analysis ignores the source of government employees’ paychecks, which are taxes. (Or borrowing, which simply delays taxation to some future time, or inflation, which robs money of its value. Fortunately Kansas can’t engage in inflationary monetary policies, but it does borrow.)

If people are not taxed, they spend or invest their money in the way they feel best benefits them. Politicians spend taxpayers’ money for political reasons, say to reward campaign contributors with padded no-bid contracts.

In fact, for many politicians creating government jobs is a good thing. To them, it doesn’t matter whether the jobs are productive, or whether people really want or need what the government workers produce. In the private sector — where firms compete with others for scare resources and the value of activity is judged by profitability — efficiency is prized. Minimizing costs is the goal. Innovation abounds.

As the following chart illustrates, private sector employment growth has lagged behind the growth of government employment. This has happened during the decade that is now being described by some as a period of “reasonableness,” with Kansas taking a “balanced” and “responsible” approach to government. The numbers in the chart illustrate the results of these policies.

This trend has been known. In 2005 Alan Cobb, then State Director of Americans for Prosperity–Kansas, wrote “Unbelievably, this century Kansas has lost 16,700 private sector jobs while the government sector actually added 15,000 jobs.”

In 2011 there were efforts to reform Kansas government so that the cost of government is not so burdensome to the private sector. There was the Kansas Streamlining Government Act, an act to create the Kansas Advisory Council on Privatization and Public-Private Partnerships, and an act to implement performance measures similar to what many business firms use. These bills passed the House of Representatives but didn’t make it through the Senate. See In Kansas, there are ways to reduce the cost of government for details on these measures.

By the way, during this campaign season the Kansas Senate is being described as the last hope for the “reasonable” approach to Kansas government that has produced the results illustrated below.

Kansas private sector job growth compared to other statesKansas job growth. Data is indexed, with January 2001 equal to 1. Source: Bureau of Labor Statistics

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