U.S. Local Governments Cut Payrolls to Lowest Level Since 2006

Mike Shedlock
Posted: Apr 08, 2012 12:01 AM

In a much needed development U.S. Local Governments Cut Payrolls to Lowest Level Since 2006

U.S. local-government payrolls fell to the lowest level in more than six years in a sign that municipalities still face fiscal strains almost three years after the end of the recession.

Employment by local governments, adjusted for seasonal hiring swings, dropped by 3,000 in March to 14.1 million, the lowest since February 2006, the U.S. Labor Department reported today. State payrolls helped offset the loss, showing a third straight month of gains, rising 2,000 to 5.1 million. It’s the longest streak of job increases at that level since 2008.

Municipalities, which depend largely on property taxes, are probably cutting jobs because the housing market is still rebounding and homeowners are pressing for lower assessments, said Alan Schankel, a managing director at Janney Montgomery Scott LLC in Philadelphia. State governments, which depend more on income and sales taxes, have also cut local aid to balance budgets in the wake of the recession that ended in June 2009.

State and local-government tax collections grew at the slowest pace in a year in the final quarter of 2011, the U.S. Census Bureau said last month. Revenue rose 2.1 percent from a year earlier to $387.2 billion. While it was the ninth straight advance, it was the smallest jump since the end of 2010. Property taxes rose 0.2 percent from a year before.

States and local governments have cut about 640,000 jobs combined since public-sector employment peaked in 2008.

Not Even Half The Battle

Unfortunately, firing useless bureaucrats is not even half the battle. Accrued pension benefits is the big problem for cities and states. Except in a handful of bankruptcies, little overall progress has been made.

Needed Steps

  • End collective bargaining of public unions
  • National right-to-work laws
  • Scrap defined benefit pension plans for public employees
  • Pension reform
  • Privatize  services

Another Plunge in 3-Month Rolling Average of Petroleum and Gasoline Usage for Jan, Feb, March 2012

Here is an update from reader Tim Wallace on gasoline and petroleum usage for the first three months of 2012. The chart shows Jan-Feb-March 2012 usage vs. the same three months in prior years.

click on chart for sharper image

Wallace writes ...

Hello Mish

Attached please find the latest three month rolling petroleum/gasoline usage charts. The raw data that serves to create this chart is from the Weekly Petroleum Status Report by the EIA.

The latest excuse from the government is that they needed to readjust the numbers to compensate for increased export demand that they had not properly tracked in the past couple of years.

However, that still does not account for the overall plunge in demand usage in the past several years - going back the USA peak usage year of 2007. Usage is now down by 13.6%, a huge decrease.

The overall trend continues well down in both petroleum and gasoline.

Best regards,


Also consider Ceridian Fuel Index Up 0.3 Percent in March, Down 2.2 Percent From Year Ago

Note that Ceridian real-time diesel fuel usage is back to mid-2005 levels.


Mike "Mish" Shedlock