by Calculated Risk on 7/31/2008 04:36:00 PM

From the SF Gate: Governor orders layoffs, steep pay cuts for thousands of state workers (hat tip Hernan)

Gov. Arnold Schwarzenegger ... today ordered the layoffs of thousands of state workers and steep pay cuts for most other state employees ... Cutting the pay of about 200,000 state workers to the federal minium wage of $6.55 an hour would save California as much as $1.2 billion a month, the governor's office said. Such workers would get regular pay plus back pay once a new budget is approved.

The layoffs of nearly 22,000 temporary, seasonal and student workers would save the state as much as $28.5 million a month, the governor's office added.

Many states are struggling, but California is in especially deep trouble because of rapidly falling house prices and a weakening economy.