This story first appeared on WSJ.com.
As Texas Gov. Rick Perry ponders a bid for the Republican presidential nomination, Texans weighing his economic legacy are debating the role played by a long boom in government jobs—and the possible bust ahead.
Texas has enjoyed the most robust economy in the U.S. during Mr. Perry's decade as governor, which is one reason his potential candidacy is attracting national attention. The Lone Star State gained more than a million jobs since the end of 2000, while the U.S. has lost almost 1.5 million.
About 300,000 of the new Texas jobs were in government. Well over half of them, fueled by the surging population, were at public schools. Employment in the state's public sector has jumped 19% since 2000, compared with a 9% rise in the private sector.
Now layoffs loom. State budget cuts, championed by Mr. Perry to address a big budget shortfall, are prompting school districts around the state to lay off hundreds of teachers and other workers going into the school year starting next month.
The layoffs haven't shown up in federal data, but some economists forecast they may damp the state's vaunted economic growth. And many more jobs are likely to disappear over the next two years as a result of about $15 billion in state budget cuts.
Mr. Perry's office said he wasn't available to comment. A spokeswoman said the growth in public-school jobs reflects the population boom, adding Mr. Perry doesn't believe budget cuts will hamper the Texas economy. She said the key to prosperity is the growth of the private sector, not the government sector.
Mr. Perry has urged the rest of the U.S. to use the state's low taxes, light regulation and tort reform as a model for driving private-sector growth. The fastest-growing employment sector in Texas during his tenure has been mining, which includes the booming oil and gas industry, up 63% in past decade, or 94,000, to 243,000 jobs.
Looking at the number of net new jobs, the biggest increases were in private education and health, up 408,000 jobs, or 40%, and government, up 301,000, or 19%. Employment in manufacturing and information fell.
Critics say many of the new jobs are low-wage and without benefits; according to federal data, the state is tied with Mississippi for the largest percentage of hourly workers who make minimum wage or less, at 9.5%.
Texas also benefits from factors not easily replicated elsewhere. Among them: Texas' massive size, which can support job-rich infrastructure such as the Port of Houston; its oil and gas deposits; its proximity to Mexico, an important trading partner; and its young and expanding population.
Over the past decade, Texas has added more people than any other state and now accounts for 8.1% of the U.S. population, up from about 7.4% in 2000. And Texas has added more than one in five of the public-sector jobs nationwide, including those at the local, state and federal levels.
Local government jobs in Texas rose by 225,000, or 21%, between year-end 2000 and 2010, with 169,000 of those jobs related to education, an increase of 24%, all according to federal data not adjusted for seasonal factors.
Mr. Perry has tended to play down the magnitude of government hiring, maintaining that the government's economic role is to create a favorable climate for private businesses. Las month he said that government doesn't create any jobs, they can actually run jobs away.
But the Texas numbers show the government did create jobs, with the help of federal stimulus funds, said Rep. Garnet Coleman, a Democratic state representative from Houston.
Though tea-party supporters in Texas have backed big cuts in government spending, Mark Reid, chairman of the steering committee of the Texas Tea Party Alliance, said he wasn't bothered by the expansion of local education jobs. "I know people are moving to the state and as communities grow we have to build schools," he said.
In Texas, the state is responsible for a large portion of local schools' spending. Faced with a big budget shortfall, the legislature this spring reduced per-pupil aid by several billion dollars. Those cuts will result in more than 48,000 public-school layoffs just in 2013, said Eva de Luna Castro, a senior budget analyst at the Center for Public Policy Priorities, a left-leaning think tank in Austin. Other say such forecasts are overblown, arguing schools can save jobs through efficiencies and tapping reserve funds.
Austin Independent School District has already given pink slips to more than 500 workers.
