Health care and social assistance, along with payments to individuals, account for the largest share of government spending for the federal, state and local governments combined. They are distinguished from other government functions in two important ways. First, most of the funding comes from the federal government, even for programs that are administered by states, cities and counties. And second, most of the work is done by private, often non-profit organizations under contract or voucher systems, rather than by public employees.
This is the fifth post in a series on state and local government employment for FY 2002 to FY 2014, based on data from the Governments Division of the U.S. Census Bureau. Data on private employment in sectors substantially funded by government programs was also included in the analysis, and will be particularly important for this post. New York State in general, and New York City in particular, have had far more spending in these categories than most other places. This is explained in part by the state’s Medicaid program, the most extensive and expensive in the country, and in part by New York City’s relatively high poverty rate, although that gap is closing. And in part by New York’s virtually unique commitment to public intervention in the multifamily housing market, rather than just in subsidies for suburban expansion. The high level of spending on NYC health care, social services and housing, combined with continued high poverty and high housing costs in the city, has, over the years, raised questions about how much value has been received for the tax dollar. While employment data cannot answer those questions, it can provide some insights.