Employment has been cut tremendously. With massive impending revenue shortfalls, state and local spending will continue to remain depressed, placing a drag on the economic recovery – just as austerity measures slowed the recovery from the Great recession.

Employment has been cut tremendously. With massive impending revenue shortfalls, state and local spending will continue to remain depressed, placing a drag on the economic recovery – just as austerity measures slowed the recovery from the Great recession.

Figure 1: State and local government employees, 000’s, s.a. (blue). NBER defined recession dates shaded gray; most recent recession assumed to run to May 2020. Source: BLS, NBER, and author’s calculations.