By Rob Schofield, NC Policy Watch
The much-faster-than-expected economic recovery that’s followed the easing of the COVID-19 pandemic has produced several encouraging developments in the United States: low unemployment, rising wages, strong corporate profits, flattened or even falling poverty rates – just to name a few.
And while the global spike in inflation that resulted from supply chain issues, CEO wealth grabs, and Russia’s war on Ukraine has taken a big toll on most households, that phenomenon has, thankfully, slowed significantly of late.
In short, while economic news is far from perfect – income and wealth inequality, for instance, both remain scandalously high – there are several reasons for optimism.
One big post-pandemic trend, however, that remains a vexing and chronic problem is this: the soaring number of unfilled public jobs. Across the nation, government agencies — public schools, law enforcement departments, mental health institutions and numerous others — are having enormous trouble attracting and keeping workers.
What’s more, as WRAL.com reporter Paul Specht explained in an informative news story this past weekend, North Carolina state government is a bit of a poster child for this phenomenon. As he explained, the number of job vacancies in at least 20 state departments, offices and boards were at a five-year high at the start of the fiscal year. Moreover, “at least a dozen of those groups were at 10-year highs, including some that saw vacancies increase by more than 1,000 positions since the middle of 2021.”
The report also noted that this shortfall has hit at the very same time that the state’s population has been rising fast – a reality that means extra hardship, stress, and frustration for just about everyone, from schoolkids, teachers and parents to folks waiting for emergency services or a new driver’s license at the DMV.
Of course, in some circles, the current situation isn’t necessarily seen in a negative light. Over on Right-wing Avenue – where the residents have long excoriated government as the source of almost all that ails us – the current situation was pretty much the objective all along. Remember arch-conservative ideological godfather Grover Norquist’s infamous proclamation that his goal was to reduce government “to the size where I can drag it into the bathroom and drown it in the bathtub”?
For years, conservative politicians have attempted to give effect to Norquist’s perverse vision by repeatedly slashing taxes and public investments – something that, from their cynical perspective, has given rise to a useful feedback loop in which public services and structures become increasingly stressed and ineffective and, in turn, attract even more public ire.
See for example the chronic struggles of the Internal Revenue Service, where repeated budget cuts have been followed up by efforts to further eviscerate a vital agency.
Here in North Carolina, this persistent disinvestment of the last decade-plus has resulted in a situation in which the share of the state economy devoted to funding core services has effectively fallen off a cliff.
In the early 1990s – when the state’s public schools were being lauded nationwide as models of progress and innovation — spending on state and local government services in North Carolina was equivalent to around 6.5% of the total state economy. Today, it’s around 4.5% — a reduction of almost a third, and 22% compared to the 45-year average of 5.8%.
And, not surprisingly, the impact of such massive cuts – to public employee salaries, benefits, staffing levels and morale – has been enormous.
As North Carolina Budget and Tax Center analyst Logan Rockefeller Harris reported last November, thousands of people have left state employment during 2022 as salaries plummeted in relation to inflation – so much that many effectively lost over 2.5 weeks of pay when their salaries were compared to those of the previous year.
Harris went on to note that this contrasts with the private sector, local government and federal government, which all added jobs during the same period. This indicates, she says “that this problem stems directly from the policy choices made in Raleigh not to adequately raise employee pay, and instead to divert over $4.1 billion into reserves.”
And, she might have added, it’s also a problem that’s been brewing for years as repeated regressive tax cuts have caused the state to forgo tens of billions of dollars in revenue over the last decade – funds that could have, for instance, been used to lift the state’s schools to new heights.
And while the professed rationale for these huge cuts – making the state more “business-friendly” – might offer some superficial appeal in some quarters, the truth is that North Carolina was regularly one of the nation’s top-rated locales for new businesses and business recruitment throughout the 1990s and early 2000s when taxes and revenues were higher.
The bottom line: The employment crisis in North Carolina government will, over time, be unsustainable. No state can long remain a healthy and vibrant home or destination (for people or businesses) if its core public services and structures are hollowed out and dysfunctional. And unless state leaders rethink the penny wise, but pound foolish path they’re currently on, that’s precisely the dark future that beckons.