CA hired more workers despite budget cuts

SACRAMENTO, CA (KGO) -- A new analysis shows in the midst of a severe budget crisis, the state has actually been on a hiring spree. At the same time lawmakers were raising our taxes and cutting education funds, the state actually hired thousands of workers.

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It is rare to hear about anyone hiring in this recession, but the state government is. State leaders say it's hard to cut back, even in the face of these extraordinarily tough times.

Last July, California Governor Arnold Schwarzenegger (R) signed an executive order to cut state worker pay during the budget crisis.

"I'm also ordering a hiring freeze," said Governor Schwarzenegger last year.

But a Sacramento Bee analysis of the last nine months shows the state hired roughly an additional 2,000 people outside public safety, even as the budget deficit ballooned and the California faced a huge cash crunch.

The state employed 204,525 full-time workers last June. By November that number jumped to 206,251. It dipped slightly in December, before jumping back up to 206,650 in January 2009. The number of employees went up in 66 agencies.

"State government is still living in a fantasy land and not the real world," says Jon Coupal, from the Howard Jarvis Taxpayers Association.

Taxpayer groups call the move unbelievable, especially during times when private businesses are laying off.

"If somebody has the mindset that we can continue to spend the same amount of money we've spent in the past, we think they're sorely mistaken. There needs to be retrenchment," says Coupal.

Governor Schwarzenegger defended the move. During bad economic times, he says government services are increasingly burdened with higher demand. He noted unemployment offices, for example, needed to add another 100 employees to answer phones and help process record jobless claims.

"We had to, of course staff and bring more people in. And that's how we create a bigger workforce. That's natural. But the most important thing you should know is, during my administration since I've been in office, government grew only 3.7 percent. That's the lowest of any governor in recent history," says Governor Arnold Schwarzenegger (R) of California.

The governor's aides also point out union contracts make it impossible to shuffle workers from one department to another, but that new union contracts will eventually save nearly $1.5 billion with furloughs, job eliminations and other cost-saving moves.

Surprisingly, the U.S. Census Bureau found California has one of the leanest state governments.

"If you figure out the number of workers per 10,000 people, we rank 49th out of 50 states. For most of the last 10 years, we rank 50th. We do not have an over-bloated state work force," says Professor Tim Hodson, from the Center for California Studies.

"Government simply needs to prioritize its spending with the money it has," says Coupal.

It's also interesting to note the state's largest public employee union, SEIU, has a lot of influence at the Capitol. During the last two-year legislative session, lobbying records show it spent nearly $11 million -- the most of any interest group.

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