The health care, social services and housing functions will feature far more prominently in finance data from the 2012 Census of Governments, which will be released later this year, than in the employment phase, the subject of this series of posts. That is because although these functions, and health care and social assistance in particular, are substantially paid for by the federal, state and local governments, directly or (through tax breaks) indirectly, most of the actual work is not done by public employees. It is carried out by private, frequently non-profit, organizations and institutions. Moreover while local governments are often responsible for administering these programs, most of the money comes from, and most of the rules are set by, the federal and state governments.
That said, New York City’s local government public hospital, public welfare, and housing and community development employment is substantial enough to be a significant component of the city’s relatively high local government employment overall. And by including private sector employment data in related industries with substantial government funding and involvement, it is possible to get an impression of the full scope of public sector spending in these categories from employment data. A series of charts and commentary on that data may found below.)
First a couple of reminders about the data. The employment data from the Census of Governments is for “full time equivalent” employees. That is, while full time employees count as one worker, regardless of hours worked, part time employees count as less than one employee and are weighted added into “full time equivalent” based on the number of hours worked. In the related private sector data I downloaded from the Bureau of Labor Statistics each employee, whether full time or part time, counts as one worker.
Downloading and managing the related private sector data was actually the hardest part of compiling the public employment database. In order to ensure confidentiality, the BLS will not report data unless there are at least three establishments in an industry (otherwise they would each know each other’s employment and payroll) and no one establishment accounts for more than 80 percent of total employment.
The data is at the county level, and for some smaller counties such as Staten Island in New York City, Putnam in New York’s Downstate Suburbs, and Broome among the Upstate Urban Counties, data could not be obtained for industries characterized by a few large establishments (such as hospitals and nursing homes). The private sector data for these industries in these areas is in reality be a little higher than it appears in the database and charts, and what I present is best considered an approximation. For the Rest of New York State usable data – even approximations – could not be provided at all in some cases. Moreover, in some cases if data was not available for the year in question, say 2012, but was available for another year, say 2011, I substituted the available data from the available year. All this can be seen in the spreadsheets attached to this post, which include public and related private employment databases and tables for 1992, 2002, and 2012.
The first chart shows the level of 2012 full time equivalent local government public hospital employment per 100,000 residents for the U.S., different parts of New York State, New Jersey, and other areas. The data shows that New York City had 461 public hospital workers per 100,000 residents, more than 2 ½ times the U.S. average of 182. The Downstate Suburbs were about average and the Upstate Urban Counties, the Rest of New York State, and New Jersey were far below average at 16, 67 and 26 respectively.
In a sense averages don’t mean much for this government function, because most places do not have public hospitals run by local governments. Local government employment was zero in the public hospital category in Philadelphia and Suffolk County, Massachusetts, which is mostly the city of Boston. On the other hand, it was 427 in San Francisco, 373 in Dallas County (which includes the city of Dallas), and 281 in King County, Washington, (which includes the city of Seattle), figures that are somewhat similar to if lower than NYC.
Is New York City’s relatively high level of public hospital employment offset by a relatively low level of private hospital employment? As the chart above shows, the answer is no. In 2012 New York City had at least 1,783 private hospital workers per 100,000 residents according to the BLS, above the U.S. average of 1,508. To some extent NYC’s relatively high hospital employment may result from hospital services provided to non-residents seeking high quality care here. For example, the private hospitals in Suffolk County, Mass (Boston) have 10,900 workers per 100,000 residents when compared with residents of that county alone, or seven times the U.S. average, but Boston’s hospitals provide services to the broader metro area as well. Private hospital employment is also relatively high in Cook County (Chicago) at 2,156 per 100,000 residents, and Philadelphia at 3,907.
Elsewhere in metro New York, however, the Downstate Suburbs have at least 1,689 private hospital employees per 100,000 residents, and New Jersey has 1,621, each above the U.S. average just as NYC is. So if the suburbanites are using NYC hospitals, increasing private hospital employment in the city, that isn’t because there is less private hospital employment relative to population in the suburbs themselves. Private hospital employment is relatively high relative to population in the NY metro area as a whole. The Upstate Urban Counties had at least 1,630 private hospital workers per 100,000 residents, also above the U.S. average, although public hospital employment was below average in those areas of the state.
While New York City’s employment to population ratio is relatively high in public and private hospitals, its private health care employment is relatively low for other types of health care employers. Excluding home health care, nursing homes, and hospitals, NYC had 1,469 private health care workers per 100,000 residents, lower than the U.S. average of 1,629. New York City’s employment in this category was also lower than the Downstate Suburbs at 2,381, the Upstate Urban Counties at 2,138, Fairfield County at 1,888, Los Angeles County at 1,650, San Francisco County at 1,705, Philadelphia at 1,755, Dallas County at 2,374, Harris County (Houston) at 1,656 and King County (Seattle) at 2,240.
One might imply from this data that primary health care workers, such as physicians, are relatively scarce in New York City – and in Cook County (Chicago) at 1,423 and the rural counties in the Rest of New York State at 1,025. If the physicians themselves run their own business they are not counted as employees in this dataset, but are instead self-employed. But anyone they hire would be counted in this data.
More on nursing homes and home health care in a moment.
State public hospital employment, shown in the chart above in the same scale as local government public hospital employment, is lower than local government public employment, but still significant. There were 221 full time equivalent state hospital workers per 100,000 residents in New York State in 2012, higher than the U.S. average of 126 and higher than any of the other states chosen for comparison. Although the State of New York, via the State University of New York, operates Upstate Medical Center in Syracuse and Downstate Medical Center in Brooklyn, in general state hospitals have served the mentally ill. That function has been downsized. The 221 state hospital workers per 100,000 residents in NY State in 2012 was down from 344 in 1992; the U.S. average of 126 was down from 204.
In New York City local government public hospital employment has fallen as well, reducing the excess over the U.S. average. NYC had 705 local government public hospital workers per 100,000 residents in 1992 compared with 185 for the U.S., and 461 in 2012 compared with 182 in the U.S. In the Downstate Suburbs public hospitals that were privatized in 2002 were back in the public sector in 2012.
Private hospital employment is down relative to population in NYC as well, from 1,931 private hospital workers per 100,000 residents in 1992 to 1,837 in 2002 to 1,783 in 2012. In the U.S. private hospital employment is up from 1,378 per 100,000 residents in 1992 to 1,508 in 2012. Over 20 years it is up from 1,363 to 1,689 in the Downstate Suburbs, and from 1,366 to 1,630 in the Upstate Urban Counties. While still relatively high, therefore, NYC public and private hospital employment is not nearly has high as it used to be compared with other places. In other parts of New York State hospital employment (and other health care employment) is higher relative to the U.S. average, even though the U.S. average has been rising itself.
As I noted in this post,
as proposed for FY 2014 the city’s Administration for Children’s Services, Department of Homeless Services, Department of Health and Mental Hygene, and Department of Social Services (excluding welfare and Medicaid payments) combined were expected to spend $7.9 billion. Of this amount, less than one-third is to be spent on city personnel, with the rest going to health and social service contractors, generally in the non-profit sector. But despite this the city’s local government employment in the Census Bureau’s “public welfare” category was relatively high at 264 full time equivalent workers per 100,000 city residents, triple the U.S. average of 86. New York City’s poverty rate is well above the U.S. average, but not triple.
Some of this difference may be explained by the division between state and local responsibilities in the “public welfare” category in different states. Local government public welfare employment is also higher than the U.S. average in the Downstate Suburbs at 112, the Upstate Urban Counties at 224, and the Rest of New York State at 333 (higher than in NYC). In New York State social services are generally administered by county governments rather than by the state government. In contrast in Massachusetts, Pennsylvania, Washington State, and Illinois the state government presumably administers these programs directly, because local government employment in the public welfare category is at or close to zero in Suffolk County, Mass (Boston), Philadelphia, King County (Seattle) and Cook County (Chicago).
State government public welfare employment, shown in the same scale as local government public welfare employment, was just 23 per 100,000 state residents in New York State in 2012. That was below the U.S. average of 73, but not by enough to offset the fact that extent to which local government employment was higher in this category in New York. New York State’s employment in the Census Bureau’s “social insurance administration category,” at 43 per 100,000 residents, was about the same as California but above the U.S. average of 27 and also above all the other states selected for comparison. This function includes state departments of labor and their equivalents, administering unemployment insurance and worker compensation programs.
As for private employment in the “Social Assistance” sector (excluding services for the elderly and disabled) in 2012 New York City had 978 employed per 100,000 city residents, 1.7 times the U.S. average of 574. For comparison, according to the 2012 American Community Survey New York City’s poverty rate of 21.2% was 1.3 times the U.S. average of 15.9%. Private social assistance employment per 100,000 residents, excluding services to the elderly and disabled, was about average in the Downstate Suburbs at 535, but was about as high as in New York City in the Upstate Urban Counties (799) and the Rest of New York State (1,000). It was also about as high as in New York City in Fairfield County Connecticut at (1,012), San Francisco (1,141), Philadelphia (1,119), and King County (Seattle) at 846. Suffolk County (Boston) was higher still at 1,683.
With the field of sociology having basically ceased to be a real social science over recent decades, no one has asked let alone answered the question of what New York and similar areas have received from all that social assistance employment over the years. The city’s social services certainly do not seem to have reduced poverty: the city’s relative poverty rate seems to be determined primarily by the characteristics of people moving in and moving out, not what happens to them while they are here. On the other hand, I have seen data indicating that New York City’s suicide rate is lower than the U.S. average, so perhaps the poor and troubled are in less psychological pain here as a result of the services available. Perhaps their lives are better. But no one has tried to find out objectively. Instead you have activists insisting social services spending is too low where it is already relatively high, and too high where it is already relatively low.
Whatever its merits, over the past 20 years local government “public welfare” employment has been falling relative to population in NYC. From 387 public welfare employees per 100,000 residents in 1992, it fell to 299 in 2002 and 264 in 2012. Because the drops were less dramatic elsewhere, the gap between New York City and other places has diminished, as is the case for public and private hospitals, although NYC is still higher.
While funding for most social services has been constrained in recent decades, however, spending on services for seniors continues to explode at the federal, state and local level. Much of this is funded by Medicaid, which is particularly expensive and extensive in New York.
The chart above shows private employment in the nursing home, home health care, and “services for the elderly and disabled industries” per 100,000 residents in New York City, other parts of New York State, the U.S. average, and selected other places. Services for the elderly and disabled includes “personal care” aides for those living at home but no longer able to care for themselves. This, along with home health care, is seen as a lower cost alternative to nursing home care. And in fact New York City’s private nursing home employment per 100,000 residents, at 829, was below the U.S. average of 1,015. New Jersey was about average at 1,038, but the Downstate Suburbs, at 1,274, the Upstate Urban Counties, at 1,624, and Fairfield County, Connecticut, at 1,353, were all above average.
The added home-based health and social service employment New York City required to achieve that modest reduction in relative nursing home employment, however, was huge. In the (non-medical) “services for the elderly and disabled” industry New York City’s employment, at 1,031 per 100,000 residents, was four times the U.S. average of 246 in the year 2012. NYC’s home health care employment, at 1,007 per 100,000 residents, was nearly triple the U.S. average of 378.
New York City’s home health care employment increased from 235 per 100,000 residents in 1992, slightly above the U.S. average of 184, to 1,007 in 2012, far above the U.S. average of 378. For perspective those age 75 and older, who are most likely to require these services, were 5.7% of the NYC population in 1992 according to Census Bureau estimates data. And 5.7% of the NYC population in 2012, according to American Community Survey data. (While the U.S. population is aging, in 1992 NYC had a large number of older residents left behind by the suburban migration of their children from the 1950s to the 1970s. These older residents later died off and were replaced by immigrants and college graduates by 2012).
Adding the three industries together New York City’s employment per 100,000 residents was 2,867 in 2012, nearly double the U.S. average of 1,640. The only areas examined that are close to NYC’s level of overall senior- and handicapped-related private employment are the Downstate Suburbs at 2,193, the Upstate Urban Counties at 2,353, and Philadelphia at 2,299. So substituting at-home care for nursing home care did not reduce personnel overall. Nursing homes also have non-personnel costs, such as the cost of the buildings themselves, but those elderly and disabled people living at home also have to pay for their own housing in addition to their care. Overall, the difference is employment can only be justified if the elderly and handicapped are better cared for in New York City and elsewhere in New York State than in other places, something that is unexamined.
Lets move on from how many local government public hospital and public welfare workers there are, to how much they get paid. Quickly summarizing background information from prior posts, this is best understood by a comparison with the private sector workers who pay taxes who support local government jobs, whose overall average wage level also affects the local cost of living for public employees.
If one excludes the overpaid financial sector, a labor market unto itself and one under pressure to cut pay, the average private sector worker in Downstate New York earned 28.1% more than the average private sector worker in the U.S. in 2012. So that is the baseline. But the average payroll per NYC local government public hospital worker was just 11.4% more than the U.S. average. Given the higher cost of living that goes along with the higher average private sector wage in Downstate New York, that seems a little low. But the NYC public hospital figure may or may not include the physicians, because from time to time I’ve heard that some of those are in fact provided by nearby private hospitals and perhaps on the payroll of those private hospitals (and not counted by the Census of Governments).
The average payroll per public hospital worker was 32.9% more than the U.S. average in the Downstate Suburbs, just slightly high compared with private sector workers excluding finance. In Upstate New York the average payroll per public hospital worker is relatively low, but public hospitals are very uncommon. As is true for other types of public employees, for public hospitals public sector pay is relatively high in major urban counties in California, and relatively low in the big counties in Texas, relative to private sector pay overall.
As for other types of local government workers, the average payroll per public hospital worker seems a little funky in Downstate New York for March 2002, but it was somewhat higher relative to the U.S. average in March 2012 than in October 1992 in New York City and in the Downstate Suburbs. It plunged in the Upstate Urban Counties.
Doing the same analysis for local government workers in the “public welfare” category, one finds that the average payroll per worker in New York City was 20.4% higher than the U.S. average in March 2012, a little low given that the average private sector pay per worker in Downstate New York was 28.1% above average with finance excluded. The Downstate Suburbs, Upstate Urban Counties, and New Jersey were pretty close to what one would expect given average private sector pay; California was high and Texas was low. Somehow public employee unions seem to complain a lot more in California and New York than they do in Texas even so, and you don’t see the best and the brightest government workers flocking to New York from places such as Texas, Florida and North Carolina. You see retired public employees from New York moving to those states.
As was the case for public hospitals, average payroll per local government public welfare worker was slightly higher relative to the U.S. average in NYC in 2012 than it had been in 1992, with a somewhat more substantial increase for the Downstate Suburbs.
Lets conclude with a discussion of housing and community development. Federal funding for housing is substantial, but most of it is through the tax code (the mortgage interest deduction) and the financial sector (FHA loans, the implicit backing of Fannie Mae and Freddie Mac followed by the bailout), and most of it is goes to owner-occupied housing in the suburbs. None of these expenditure show up as local government employment.
For the cities, the federal government paid for the construction of public housing projects from the late 1940s through the 1970s, and for Section 8 rent subsidy vouchers for poor households in private sector apartments starting in the 1980s. Also in the 1980s, public housing projects in older cities were required to give first preference to those the suburbs did not want –the homeless, ex offenders, the addicted, the mentally ill, the high school dropouts, unemployed. Federal funding for multifamily housing for the poor was cut at about the same time, and has been cut repeatedly – more than any other type of federal expenditure – since. Since public housing is concentrated in a few places, it is an easy political target.
New York City was left with a huge stock of public housing operated by the New York City Housing Authority, with less and less federal money to cover operating subsidies, maintenance and rehabilitation. In the 1980s, when the city’s debt service and pension costs fell as the 1970s fiscal crisis ebbed, NYC also embarked on its own locally-financed housing redevelopment program, using local taxes and borrowing to make up for lost federal dollars in programs administered by the separate Department of Housing Preservation and Development. Other cities responded to the lost federal assistance by nearly eliminating their housing programs and tearing down public housing.
In 2012 New York City had 164 local government workers in the Census Bureau’s “housing and community development” category per 100,000 city residents. As one would expect in a nation where public housing is concentrated in relatively few areas, that was far more than the U.S. average at 34, the Downstate Suburbs at 16, the Upstate Urban Counties at 35, the mostly rural Rest of New York State at 8, and the mostly suburban state of New Jersey at 38.
NYC, however, also had more housing and community development employment relative to population than San Francisco at 61, Los Angeles at 45, Cook County (Chicago) at 21, and Philadelphia at 84. Only Suffolk County, Mass (Boston) is nearly as high at 162. The powerful Boston Redevelopment Authority, more into community development than low- and moderate-income housing, is a major force in that city. Similar urban redevelopment agencies in California cities, generally funded by tax increment financing, were recently dissolved by the state to shift funds to soaring public employee pension costs.
While still relatively high, NYC’s local government housing and community development employment has been affected by the loss of federal funds and the using up of city-owned abandoned buildings and vacant lots from the urban decline era of the 1970s. (The city’s few remaining vacant lots have been privatized as the preserves of groups of urban gardener.) The New York City Housing Authority has been losing workers and cutting services in a perpetual fiscal crisis. New York City’s local government housing and community development employment fell from 255 per 100,000 residents in 1992 to 211 in 2002 to 164 in 2012. Despite the cutback in Section 8 vouchers made available for poor families in private housing, with the that money shifted to support the deteriorating public housing stock instead. With some exceptions, the local government employment trend for housing and community development is down elsewhere as well. There was a big drop from 1992 to 2002 in Cook County (Chicago). The Chicago Housing Authority has torn down thousands of housing units in high-rise housing projects.
The average payroll per local government housing and community development worker in NYC was 15.9% above the U.S. average in 2012, a little low given that the average pay per private sector worker excluding finance was 28.1% above the U.S. average in Downstate New York at the time.
The pattern of New York City having relatively high employment (and a high number of retirees given extremely rich pensions) and somewhat lower cash pay has now repeated for instructional public school employees, police officers, public hospital workers, public welfare workers, and housing and community development workers. Compared with local governments in other places NYC has very high total labor costs (if one includes the retired) and taxes, but relatively low visible cash pay.