The latest jobs report showed the labor market picking up steam again after a summer slowdown due to the delta variant. But one sector is still lagging: state and local government, especially public schools, which lost about 65,000 jobs on a seasonally adjusted basis last month.

October is the third month in a row that local public sector jobs took a hit, said economist Dean Baker with the Center for Economic and Policy Research.

“A lot of us had been kind of scratching our heads because I – and I think most analysts – had been expecting a big jump, particularly in education where schools are open again, almost everywhere,” he said.

But, he said, there’s a lot of competition for labor.

“In the private sector, if you want to hire someone, you can raise wages … they could offer bonuses.”

Private employers are pulling out all the stops, said Julia Pollak, chief economist at job site ZipRecruiter, offering extra money, new benefits, more flexibility.

“And it’s happening everywhere, across every industry with the exception of government. And that’s because government hiring is very inflexible,” she said.

Salaries and benefits in government often have to go through time-consuming approval processes. But states are flush with hundreds of billions of dollars in federal relief funds, so Pollak expects compensation to start catching up in coming months.