by Calculated Risk on 4/19/2012 08:50:00 PM

A few months ago I wrote:

It is looking like there will be less drag from state and local governments in 2012, and that most of the drag will be over by the end of Q2 (end of FY 2012). This doesn't mean state and local government will add to GDP in the 2nd half of 2012, just that the drag on GDP and employment will probably end. Just getting rid of the drag will help.

It is time for an update - it is early in the year, but it is possible the employment drag from state and local governments has already ended. In fact, state and local government have added 14 thousand jobs since December.

Click on graph for larger image.

This graph shows total state and government payroll employment since January 2007. Note: Some of the stimulus spending from the American Recovery and Reinvestment Act probably kept state and local employment from declining faster in 2009.

Of course the Federal government is still losing workers (53,000 over the last year), but it looks like state and local government employment is stabilizing.