Report Paints Dismal Employment Picture for Ohio

AP - September 4, 2011
   

Associated Press

One of every 10 Ohioans lost a job over the past decade and workers 
saw a higher drop in wages than any other state, according to a report being released 
Sunday by liberal think tank Policy Matters Ohio.

The State of Working Ohio 2011 report says about 42 percent of those unemployed last year
had been without a job for more than six month, the highest level in 60 years of record
keeping. The number of Ohioans employed or looking for work in 2010 fell to about 65
percent, the fourth consecutive annual decline.

“We are hemorrhaging jobs,” said Policy Matters Executive Director Amy Hanauer, who
wrote the report. “We need to be actually growing jobs to keep up with people entering the
workforce and instead we’re losing employment. … I only see that situation looking worse
because we’re laying off public sector workers, and so that will just add to the ranks of the
unemployed.”

The report says 594,000 Ohio jobs were lost from 2000 to 2010. The average annual
unemployment rate — 10 percent — is “worse in this slump than in recessions of the early
2000s or the 1990s but not as bad as 12 percent rates in the early 1980s recession,”
according to the report, which relies largely on crunching of U.S. Census Bureau data by the
liberal Economic Policy Institute.

The state’s median wage drop of 86 cents from 2000 to 2010 was the highest among the
states, the reports shows, topping Tennessee by 13 cents and Michigan by 16 cents. Further,
employment numbers for the state’s men hit historic lows, the report says, with 70.5 percent
employed or seeking a job in 2010.

Matters are worse in Ohio than many other states due to its economic structure, said Scott
Shane, Economics Department Chair at the Weatherhead School of Management at Case
Western Reserve University.

“States that have a lot of innovation, lots of investment in education and a lesser reliance on
manufacturing have had higher per capita income growth for the past 80 years,” he said.

“Ohio’s inventiveness has been in relative decline versus other states, our education levels
have been low compared to other states and our reliance on manufacturing higher than
other states for many decades.”

Policy Matters recommends that the federal government invest in the weatherization of
public buildings to put people to work. It also says the state should employ workers on
projects like razing dilapidated housing and in areas such as preventive public health
services.

The group also calls on Ohio to restore funding cuts made to local governments and schools
and for the federal government to strengthen domestic manufacturing, invest in early
childhood education and provide fiscal relief to states.

“The Recovery Act did help, but it was just much too small to deal with the large hit our
economy had taken,” Hanauer said. “So I think that these levels of unemployment could
absolutely be addressed with better policy.”

Gov. John Kasich’s spokesman Rob Nichols says the governor has been talking about the
state’s dire economic condition for two years, but has started to turn things around,
achieving a net job growth of 45,100 jobs in Ohio since taking office in January.

“We’ve had good success,” he said. “But make no mistake, it is a deep, deep hole. … We’re
making progress but we have a long way to go.”

Nichols called Policy Matters’ recommendations “a reversion back to the same tragically
flawed ideas that got us into the ditch.”

Instead, he said, the numbers underscore the need for the state to move forward with
privatizing the Department of Development, throwing out “needless and silly regulations
that stifle businesses” and reducing taxes to draw employers to the state, he said.

Case Western’s Shane said it’s unclear whether either approach is appropriate because the
report does not analyze the causes of the problems or how they would be remedied by
suggested solutions. He said answers lie in long-term investments in education and new
technology.

“If there are deep, long-term structural problems, you can’t just switch policies and solve
them. If we want incomes of the average Ohioan to catch back up to other states, it will take
an approach that will take more than a decade to implement,” he said. “Each passing year we
put off making the real long term changes we need to make in search of the holy grail of
the short term solution that’s cheap and easy, the further in the future a better Ohio will be.

 

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