As noted in a previous post, according to U.S. Bureau of Labor Statistics data released on August 25, nonfarm payroll increased in July in 21 states and the District of Columbia, compared to the previous month.
Thankfully, this was not all about government employment.
In 17 states, nonfarm payroll growth would have been positive without government payrolls being included. And while growth in Washington, D.C., was overwhelmingly about government, there was a tiny increase in the private sector.
However, in four of these states – Alabama, Kansas, Montana and Vermont – private payroll growth was either flat or negative.
The key to economic growth is private sector risk taking – not government handouts and/or subsidies. Private investment and entrepreneurship in turn lead to robust job and income growth. Federal and state governments need to get the policies right for entrepreneurship and investment to flourish, and that means, primarily, low taxes and a light regulatory touch.
Raymond J. Keating
Chief Economist
Small Business & Entrepreneurship Council
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