State and local tax revenues bottomed out in 2010, roughly two years after the official start of the Great Recession, forcing governments to sharply curtail construction and lay off employees. That year, our annual survey on architecture, engineering, and construction (AEC) firm use showed a corresponding decline in government spending on AEC services.

The economy’s improved since then, but public works employment levels haven’t. With many departments having shed valuable in-house expertise, spending on project planning has hit an all-time high.

The good news: Local and state governments are beginning to hire again.

Two-thirds of public-sector human resources professionals reported hiring employees in the past year, with 55% saying they hired more than they did in 2012. The workforce survey was conducted in May by the nonprofit Center for State and Local Government Excellence, the International Public Management Association for Human Resources (IPMA-HR), and the National Association of State Personnel Executives.

The bad news: Retirements have also increased, and hiring managers are having a hard time finding skilled replacements.

“The survey results confirm that the economy is improving, although most government workforces are still smaller than they were in 2008,” says Neil Reichenberg, executive director, IPMA-HR.