Would the job guarantee increase the size of government?
Not necessarily. The job guarantee reduces existing costs of unemployment, poverty, and other social deprivations related to lack of stable employment.
The job guarantee would require an administrative structure to function well and a budget to support its demand-driven design. While some worry about the financial costs of these programs, real world programs and large-scale models suggest that they are still relatively modest (0.5-2.5% of GDP). (Wray, Dantas, Fullwiler et al. 2018).
In developing countries with large involuntary unemployment and a small public sector, the program will likely increase both the public sector size and its capacity to deliver public services.
Wray, et al. (2018). Public Service Employment: A Path to Full Employment. Levy Economics Institute.Back to all FAQs