“The approaching state budget cuts … will cause the U.S. economy to contract further — making the economic downturn deeper and more protracted, causing many more people to lose their jobs, and magnifying the serious hardship we already see,” said Robert Greenstein, the think tank’s president.
Roughly 20 million people work in the public sector at the state and local level, which is more than the number employed in the hard-hit retail industry. The last time the public sector faced such steep budget cuts was during the Great Recession a decade ago. State and local governments shed 627,000 jobs in the three years following the downturn, according to the Economic Policy Institute.
Experts are worried this time could be even worse, but plugging the hole could require a staggering infusion of cash, which the union representing public sector workers readily acknowledges. The American Federation of State, County and Municipal Employees is pushing for at least $700 billion in the next relief package.