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The recession's job roller coaster

Governments have saved some via stimulus but have had to cut others

As states slash support and stimulus dollars are funneled through targeted grants, local governments must simultaneously give pink slips to veteran employees and opportunities to fresh recruits.
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Washington Post Staff Writer
Sunday, December 6, 2009

Audrey Hedgepesth was in the shampoo aisle at CVS when she got the phone call that changed her life. She had been hired as a Bladensburg police officer, the caller said, a position created by federal stimulus money. "I started dancing in the middle of the aisle," recalled a grinning Hedgepesth, 23.

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About the same time in October, veteran Prince George's County auto mechanic Mark Carrico got life-changing news, too. The county was facing tough times, he was told, and some people had to be let go. The news that he was one of them left him feeling like he was "falling out of an airplane without a parachute," Carrico, 52, said.

In responding to the recession, government has given with one hand and taken with the other. Although some have been saved by the $787 billion stimulus, many others have been the victims of local government cutbacks. States and localities, faced with shortfalls and mandates to balance their budgets, have laid off thousands, adding to the unemployment crisis.

The Prince George's area has seen both policies play out, creating its share of winners and losers. For Hedgepesth, becoming a police officer felt like a just reward after three years of trying. For Carrico, two stints with the county totaling 13 years came to an abrupt end.

Prince George's officials said they tried everything before letting Carrico and 49 other employees go. They froze hiring, slashed spending, cut vacant positions and furloughed all workers for 10 days, two years in a row.

Then, in August, Maryland announced cuts to localities, costing Prince George's $22.7 million and leaving a gaping hole in the county budget. To help close it, County Executive Jack B. Johnson (D) said he had no choice left but to lay people off.

More than $34 million in stimulus funds awarded to the county government did little to avert layoffs, officials said, because it came with constraints on how it could be spent. More than $10 million could be used only to hire 50 county police officers for three years. And $6.9 million was earmarked for the county's bus fleet. Other funds will go to energy-efficiency efforts.

"While these are great programs and they're helping the county a lot, it doesn't really help to offset general-fund dollars," said county budget director Jonathan R. Seeman. "These are grant funds, and they are almost universally for very specific purposes. . . . It really doesn't affect the layoffs."

Lost and gained

Countywide, nearly 5,000 jobs were lost in the public and private sectors from March through October, labor statistics show, and the stimulus is credited with creating or saving nearly 600 jobs during about the same span.

From March through October, 2.8 million jobs were lost nationwide, including 131,000 state and local government positions, according to federal statistics. About 640,000 jobs have been created or saved by the stimulus, according to the government Web site http://recovery.gov. That figure does not account for jobs indirectly created by the aid through re-spending and subcontracting.

The government cuts in Prince George's added to grim circumstances for many residents. The county was hit hard by the foreclosure crisis, and many neighborhoods remain checkered with abandoned lots. Small-business owners, unable to get loans, are closing up shop, reversing years of progress the county had made in attracting retail within its borders, said Phil Lee, president of the Kettering Civic Federation.

"I'm really kind of distraught," Lee said. "It's two steps forward, four steps backward."


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