All around the state, cities and counties are in the throes of budget-setting. Soon, members of the Joint Legislative Budget Committee, will be at the Capitol preplanning the state’s spending for next fiscal year. While, “Wow, what are we going to do with all this money?” is a phrase rarely heard at such gatherings, it can be agreed that the coming year will be more austere than some years past.

A fundamental consideration — and one rarely mentioned — is the reason why governments need more and more money. No secret. It’s because they’re growing. Indeed, public employment has for years been a key growth sector in the economy and, even during the recession, that trend has continued in Mississippi.

Of all people with jobs, 17.1 percent — almost one out of five — are on a public payroll. The breakdown is 2.2 percent federal, 3.9 percent state and a whopping 11 percent local. Think about that last number. More than one in 10 people draws a city, county or public school paycheck.

In the private sector nationally, 6.9 million jobs disappeared in the past 18 months. During the same time, 110,000 new government jobs were created.

The Nelson A. Rockefeller Institute of New York has just compiled a boatload of figures on employment trends.

Not all states have been increasing employment. Indeed, 26 had fewer employees in state government in the second quarter of this year than in the second quarter of 2008. Mississippi was not among those with declines. In fact, Mississippi had 2.6 percent more employees this year than in 2008. Only nine states were expanding public employment at a faster rate.

During the same time, local governments got smaller, overall, in 16 states, but, again, not in Mississippi. Here, local government employment was up 1.6 percent.

Eight states had growth both in the ranks of teachers (which is the largest category) and non-teachers. Mississippi was one of them, and, despite all the talk about education needs in this state, non-teacher public jobs grew faster than jobs in education.

The good news for Mississippi was that economic expansion was taking place as government employment grew. That’s not true in all states. Some had employee gains even while their tax base was shrinking. That’s double trouble.

The next question that arises is why government is growing. Again, there’s nothing sinister in the answer. It centers on the fact that people want more services, ask for more services from their elected officials and their elected officials, who want to keep their jobs, ante up. It’s a myth that politicians sit around and come up with reasons to raise taxes. When they do, it’s because it’s the lesser of two evils. People are delusional to keep thinking we can have more universities, more dog-catchers, a safer food supply, prisons to hold all the bad dudes, well-kept parks and super-fine recreation programs and, yes, “free” health care for the poor or the old or everyone, and that the size and proportional cost of government will not increase.

Not only will that share rise, the number of private sector jobs that depend on providing goods and services to government will rise, too. Federal, state and local governments are major customers of private businesses of all types. Indeed, thousands of private businesses would go belly up without their government clients and contracts.

Public employees are not markedly different from private employees. Both serve as cogs in commerce. They generate a product or perform a task or do something to earn a paycheck. They buy food, other goods and services and pay taxes just like anybody else.

What is different is the source of their compensation.

Public employees’ pay comes from tax sources that are largely based on private sector transactions (such as sales and excise taxes) and private sector profits (individual and corporate income taxes). Public entities do not contribute to these funds, nor do they pay property taxes.

It doesn’t take a doctorate in economics to understand that a shift from private employment to public employment will have consequences.

As long as both sectors are increasing, the effect is minimal.

But when the balance shifts, things can go awry in a hurry. We’re on the leading edge of an imbalance in Mississippi and it’s not because Barack Obama is president or Haley Barbour is governor. With the private economy stalled and the public sector continuing to grow, something is going to have to give.