The May employment report, with a headline jobs-growth figure of 75,000, at best drew mixed reactions from Wall Street and the financial press. Deeper within the data, however, an important and positive development deserves to be noted: Total federal government employment under President George W. Bush continues to decline.

Since Bush took office in January 2001, government jobs have dropped by 51,000 — nearly 2 percent. That may not look like much, but it is a continuation of a trend that represents a small victory for fiscal conservatives and economic libertarians — those who support limited government and the philosophical principle of a smaller federal labor force.

The Bureau of Labor Statistics, since its founding by Congress in 1884, has at times refined its methodology for measuring nonfarm employment. The most recent improvement occurred in 2003 when the North American Industry Classification System (NAICS) replaced the U.S. Standard Industrial Classification (SIC) system. The federal employment time series “was revised slightly in scope and definition due to a change in source data and estimation methods.” The federal job decline now appears in both seasonally adjusted and non-seasonally adjusted BLS data.

The data show that total federal employment peaked under President George H.W. Bush at 3.4 million in May 1990. That number, as measured by the BLS, fell to 3 million by the time Bush the Elder left office. President Bill Clinton continued the trend while president, and is one of two Democrats (the other was Harry S. Truman) in the postwar era who presided over a decline in total federal employment. Government jobs also dropped under Republicans Dwight D. Eisenhower and Gerald R. Ford.

As of the latest jobs report, total federal employment under George W. Bush was 2.7 million in May 2006. That represents a loss of more than one in every five federal employees since 1990.

A few governors have also made sincere efforts to reduce government employment in their states. California state employment under Republican Gov. Arnold Schwarzenegger, for instance, has been flat. Non-seasonally adjusted data reveal that it was 475,600 in November 2003 and 474,800 in April 2006 — the most recent month for which data is available.

Unfortunately, the proverbial “gravy train with biscuit wheels” – as they say in the rural South – is still rolling down the road in other states. Growth in state government employment is a bipartisan phenomenon with Republican, as well as Democratic, governors presiding over bloated state labor forces that keep expanding. The policy decisions of governors have helped total state government employment to swell from 4.2 million in May 1990 to 5 million as of last month. Total local government employment increased from 10.8 million to 14.1 million in the same period.

Still, the biscuit wheels on the federal gravy train are smaller thanks to the policies of our three most recent presidents. If the states can get the message that less can be more when government jobs move to the private sector, a small but important trend will become a significantly positive event.

Indeed, when it comes to the relationship between less and more, less government always equals more freedom.

– Greg Kaza is executive director of the Arkansas Policy Foundation, an economic research organization founded in 1995 in Little Rock.