Is Government Employment Recession-Proof? Was It Ever?

Abstract

Population Survey from 1984 to 2012 to investigate the differences in job loss rates between workers in the public and private sectors. My focus is on the extent to which recessions affect the differential between job loss rates in the two sectors. I find that, holding worker characteristics constant, public sector workers are substantially less likely to lose their jobs. For federal government workers, the differential is 4.1 percentage points; for local workers other than public school teachers 4.1 percentage points; for state workers other than public school teachers 3.4 percentage points; and for public school teachers 1.2 percentage points. This differential increased during the Great Recession. It also increased during other recessions since the early 1980’s. However, although public sector workers are less likely than their private sector counterparts to lose their jobs during recessions, the probability that a public sector worker loses his or her job during a recession does in fact increase. Thus, the answer to the question posed in the title to this thesis is that public sector jobs, while not recession-proof, do offer more job security than private sector jobs, and in relative terms, this advantage increases during recessions. These patterns hold for both males and females, whites and non-whites, and highly educated as well as less educated workers.