State, City Government Job Losses Estimated 400,000-900,000 Due to Budget Shortfalls

Moody's has estimated 400,000 jobs from State, City and Local governments will be lost next year due to budget cuts.

Up to 400,000 workers could lose jobs in the next year as states, counties and cities grapple with lower revenue and less federal funding, says Mark Zandi, chief economist for Moody's

The Center for Budget and Priorities has the estimate much worse, a total of 900,000 jobs affected.

it will slow the economic recovery and raise the risk that the nation will fall back into recession as the loss of Americans’ spending power ripples through the economy. States’ actions to close their $140 billion gap without more federal aid could cost the economy up to 900,000 public- and private-sector jobs.

More estimates:

Wells Fargo economist Mark Vitner expects state and local governments to cut about 200,000 workers this year if Medicaid benefits aren't extended. That's largely why Wells Fargo cut forecasts for third-quarter economic growth to 1.5% from 1.9%.

Even if Congress extends Medicaid subsidies, Zandi expects 325,000 job cuts the next year, though Vitner says losses could be far less.

It appears much of the cuts have to do with help to the elderly and poor and Medicaid. Below is the list of cuts already and one must ask if states are not purging the roles of ineligible people and what are they doing about Medical costs. Denying an American equipment to help them breath is truly a scary thought and this is one of the cuts listed. The below current cut list and budget graph is from the Center for Budget and Priorities.

  • An estimated 10,000 families in Arizona will lose eligibility for temporary cash assistance as the time limit for that assistance is cut back to 36 months from 60. Over 1 million low-income Arizonans will lose access to Medicaid services offered by the state, including emergency dental services, medically necessary dentures, insulin pumps, airway devices for people with chronic lung disease, gastric bypass surgery, certain hearing aids for the deaf or severely hard of hearing, and prosthetics. Arizona also will eliminate a host of behavioral health services for 4,000 children ineligible to receive such services through Medicaid, and will eliminate case management, therapy, and transportation services for 14,500 individuals participating in a non-Medicaid program for the seriously mentally ill.
  • Georgia will eliminate as many as 284 eligibility workers who help low-income families enroll in the food stamp, Medicaid and TANF programs. Eligibility workers are being cut even as an increasing number of families are qualifying these programs due to economic hardship.
  • Idaho’s Department of Health and Welfare will reduce or eliminate cash assistance to 1,250 low-income elderly adults and people with disabilities.
  • A Kansas reduction in grants to Centers for Independent Living will result in a loss of services for nearly 2,800 individuals with a disability.
  • Minnesota residents successfully transferring from welfare to work will see monthly cash bonuses that they receive from the state cut in half (from $50 to $25).
  • Oregon will make significant cuts to community mental health programs, reducing access to crisis services, acute psychiatric treatment, medications and case management services for 1,462 Oregonians with mental illness.

Other cuts to programs and services resulting from spending reductions in states’ 2011 budgets have already been implemented or will take effect later on in the new fiscal year:

  • Colorado is cutting public school spending by $260 million, nearly a 5 percent decline from fiscal year 2010. The cut amounts to more than $400 per student.
  • Because of changes that Connecticut made to its Medicaid program, on June 1, 2010, over 220,000 pregnant women, parents, caretaker relatives and disabled and elderly adults lost coverage for over-the-counter medications and nutritional supplements (with exceptions for insulin and supplies, nutritional supplements for those with feeding tubes, and prenatal vitamins).
  • Florida’s 11 public universities will raise tuition by 15 percent for the 2010-11 academic year. This tuition hike, combined with a similar increase in 2009-10, results in a total two-year increase of 32 percent.
  • Georgia is cutting state funding for K-12 education for FY 2011 by $403 million or 5.5 percent. The cut has led the state’s board of education to exempt local school districts from class size requirements to reduce costs. The state also cut state funding for public higher education. As a result, undergraduate tuition for the fall 2010 semester at Georgia’s four public research universities (Georgia State, Georgia Tech, the Medical College of Georgia, and the University of Georgia) will increase by $500 per semester, or 16 percent. Community college tuition will increase by $50 per semester.
  • In Minnesota, as a result of higher education funding cuts, approximately 9,400 students will lose their state financial aid grants entirely, and the remaining state financial aid recipients will see their grants cut by 19 percent. The state is also making a 40 percent cut to state aid for counties that funds child protective services, and services provided to disabled and vulnerable adults.
  • Missouri’s fiscal year 2011 budget reduces by 60 percent funding for the state’s only need-based financial aid program, which helps 42,000 students access higher education. This cut could be partially restored with other scholarship money, but will still result in a cut of at least 24 percent to need-based aid. The state is also cutting by 46 percent its funding for K-12 transportation. The cut in funding likely will lead to longer bus rides and the elimination of routes for some of the 565,000 students who rely on the school bus system.
  • Mississippi’s Department of Human Services will lay off 124 workers, 115 of them from a community-based juvenile justice facility.
  • Oregon is eliminating a program that helps 2,000 elderly residents who have been diagnosed with Alzheimer’s disease or a related dementia disorder to remain in their homes rather than receiving care in an institution. The state is also making major cuts to state funding for in-home care services such as meal preparation and homemaking, affecting another 10,500 elderly residents. Oregon is also cutting funding for K-12 schools, community colleges, and pre-K programs; among other results, an estimated 585 fewer children will be able to attend pre-kindergarten in the coming school year.
  • Virginia’s $700 million in cuts for the coming biennium include the state’s share of an array of school district operating and capital expenses, and funding for class-size reduction in

Kindergarten through third grade.

  • Washington is imposing a time limit on the receipt of medical and cash assistance by people who are physically and/or mentally incapacitated and unable to work. In 2011, the limit will reduce the number of people receiving medical assistance by 2,350 and the number of people receiving cash assistance by 2,828. The state is also cutting a further 6 percent — on top of previous years’ cuts — from direct aid to the state’s six public universities and 34 community colleges, which will lead to further tuition increases, administrative cuts, furloughs, layoffs, and other cuts. The state also cut support for college work-study by nearly one-third and suspended funding for a number of its financial aid programs.
  • Wyoming is cutting aid to local areas by more than half.

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