If you follow policy debates, you might have heard that austerity policies—all those cuts in government spending from the last few years—have weakened the economy. That has meant fewer jobs, lower pay, and more insecurity.
But austerity is having another, less widely heralded effect on the country: It's throwing teachers out of work. A new report from the National Employment Law Project (NELP) paints the depressing picture.
The report’s main focus is on the mix of high- and low-paying jobs that the economy has lost and created over the last few years. According to NELP, 44 percent of job growth came in low-wage sectors. But those industries accounted for just 22 percent of job losses during the Great Recession. The opposite trend holds for high-paying jobs. Those industries accounted for 43 percent of job losses, compared to 30 percent of employment growth.
That sounds bad—and if the report is correct, it would be. But Justin Wolfers, a senior fellow at Brookings Institute and economics professor at the University of Michigan, offered a reason to think otherwise in a piece in the New York Times on Monday. Wolfers argued that the industry-level data that NELP collects “tells you something about the type of building you walk into when you go to work, and not much about the type of work you do, or how well you are paid.”
Despite this apparent flaw, some details of the report are still meaningful. NELP broke down net employment changes by industry, and found that the three sectors with the largest net reduction of jobs were federal, state, and local government. (That’s consistent with the loss of high-paying jobs, since public sector work tends to pay better than private.) And of the 627,000 jobs that government shed, 44 percent were from education at the local level.
That’s equivalent to almost 300,000 fewer people working on public education. Many of them are teachers.
It didn’t have to be this way. Local and state governments typically have limited abilities to borrow money. The federal government doesn’t. There’s been a lot of slack in the economy, which means the government could have done plenty of borrowing and spending without crowding out private investment. It could have used that money to invest in infrastructure or simply to mail checks to Americans. Or it could have given the money to state and local governments. That would have spared most if not all of those education jobs, which would have been good for local economies (unemployed teachers do the same thing as other unemployed people—they spend less money.) It might also have been good for the kids in school, although the relationship between class size and education quality is pretty murky.
Conservatives might cheer these layoffs, or at least not bemoan them, because they think public school teachers specifically—and public sector workers generally—are paid too much anyway. But even to the extent that might be the case, this sort of indiscriminate cutting wouldn’t make a whole lot of sense, for reasons economist Noah Smith explained last week:
Anyway, because government doesn't make decisions on a monetary cost/benefit margin, it tends to be inefficient. But because of that, if you take a hacksaw to government, starving it of funds, or demanding that it fire workers and close divisions, these firing and closing decisions will not be made on a cost/benefit margin. If you force a corporation to downsize, it will usually lay off the least productive workers first. But if you force a government to downsize, it very well might lay off the most productive workers while retaining the least productive ones!
The very thing that makes government inefficient can make cutting government inefficient!
Danny Vinik is a staff writer at The New Republic.