Federal Employment

Macro
Labor
Is Federal Employment Driving Payrolls?
Author

Mike Aguilar

Published

February 7, 2025

Lots of buzz suggesting that Government Employment is THE primary driver of payroll growth in the U.S. Let’s see.

Government Share of Payrolls

Private payrolls are the lion’s share of total jobs.

Growth since Covid

Private Payrolls lead the charge coming out of COVID

Growth since 2023

But Government job creation has taken off since 2023.

Contribution since 2023

Months like summer through Fall 2024 were dominated by Goverment job creation, but that has since faded.

A slightly wider lens

Aside from the decennial census related jump in Government payrolls in 2019, what we saw in 2024 was indeed unusual, but we’re back to more normal contributions of Federal employment; i.e. at the moment, I don’t agree with the claims that all of our job creation is government-related.