Government jobs serving as shield against recession

In Riley County, Kan., Army base and public university keep economy humming

In North Carolina, where one in nine workers can’t find a job, there’s a county where the tough times haven’t been all that bad. In fact, unemployment is well below the state average, relatively few homes are falling into foreclosure and people are still flocking to restaurants and spending money at stores.

The Teflon economy of Orange County is unique to the state but not the nation. The United States is dotted with places that appear to be islands of relative prosperity in the sea of recessionary woes. A common trait among these counties: At least 15 percent of the work force is employed by the government, according to an Associated Press analysis.

In Orange County, it’s the University of North Carolina, the nation’s oldest public university and, in good times or bad, a job-creating machine. Elsewhere, it’s military bases, state capitals, universities and other government institutions.

The AP’s Economic Stress Index, which factors in unemployment, foreclosures and bankruptcies to calculate a score that measures the relative impact of the recession, shows that about 300 of the nation’s 3,000 counties are being sheltered from the economic storm by large numbers of workers who get paychecks from federal, state or local governments.

The analysis, which assigns each county a score from 1 to 100 with higher numbers reflecting the greatest stress from the recession, also suggests the locales are in a strong position to weather likely cuts in government spending. AP found that for every 5 point drop in the percentage of government workers a county has, there was a corresponding 1 point rise in the county’s Economic Stress score.

Kansas counties

In Riley County, Kan., the military and Kansas State University dominate the work force. Leon County, Fla., where Tallahassee is, relies on state government. And in Los Alamos, N.M., it’s a national laboratory.

Douglas County, Kan., is home to two publicly funded universities, Kansas University and Haskell Indian Nations University.

In Orange County, which also includes part of the Research Triangle, 25 percent of the jobs are government-funded, according to Census Bureau data. Its latest Stress Score: 6.63. In neighboring Alamance County, by comparison, 1 in 20 jobs are government funded. Its Stress Score: 12.92.

The University of North Carolina has 12,000 employees. On top of that, tens of thousands more people — students, researchers, patients at the university’s hospital and sports fans — pass through campus and spend money. In March, as the rest of the country was hitting the bottom of the recession, Orange County was cheering the school’s basketball team on to a national championship.

The team’s run “brought us tens of millions in new purchasing over the last month and a half,” said Aaron Nelson, president of the Chapel Hill-Carrboro Chamber of Commerce. “Every game we go further into a tournament is another evening of absolutely full bars and restaurants.”

The university’s workforce alone is paid $1.2 billion a year in salary and benefits, an average of $100,000 each. The state is facing a budget deficit of up to $4 billion and has told workers to take 10 hours of unpaid time off this year to save money.

“In good economic times, a 3 percent pay increase for state employees is like recruiting a new employer with a $50 million payroll,” Nelson said.

Downside to public jobs

There are limits to government-financed job security — the good times are never quite as good because a boom doesn’t inflate government pay the way it can wages in the private sector. And when tax revenue drops, bad times can affect government employees — states from California to Maryland have plans to furlough workers and cut pay this year.

Nelson also points out that government institutions typically don’t pay property taxes.

And big government employers are subject to abrupt change that may have nothing to do with the broader economy. Riley County endured several years of unexpected pain when the U.S. Army moved thousands of soldiers from Fort Riley to Germany in the mid-1990s.

But even if governments take the drastic step of cutting jobs, it’s usually not on the scale now common among big corporations and small, locally owned shops.

It’s often just too tough to lay workers off “because of the unions, because of the civil service protection,” said economist Suzanne O’Keefe at Sacramento State University.

Now, Riley County, Kan., is riding what might be the ultimate wave of government-financed prosperity.

On the northeast side of Manhattan, the county seat, is Kansas State University, to the west of town is the U.S. Army’s Fort Riley, and soon the federal government will start building the National Bio and Agro-Defense Facility. Between them, the three will provide more than 30,000 jobs in a county with about 65,000 people.

The county’s Stress Score is among the 30 best in the country, 3.72.