John Kasich's job claim accurate, but experts say it's only one part of Ohio's economic story
Posted August 14, 2015 in Selected Press
COLUMBUS, Ohio -- Gov. John Kasich likes to trumpet that Ohio has added 350,000 private sector jobs on his watch as he touts his resume on the presidential campaign trail.
But his claim has prompted some grumbling.
After the Republican presidential debate Aug. 6 in Cleveland, critics complained that Kasich cherry-picked a number that made him look good. They say the claim gives a false impression of where Ohio's economy stands as it recovers from the great recession, and that Kasich doesn't deserve to grab the credit for the economic rebound.
So what's the full picture look like? The answer is a mix of good and bad.
Data from the federal Bureau of Labor Statistics backs up Kasich's jobs claim, for the most part. During the administration of Kasich's predecessor, Ted Strickland, which spanned the recession, Ohio lost nearly 360,000 jobs, BLS data shows. Nearly 340,000 were in the private sector -- less than Kasich's claim.
But the state was down by more than 350,000 private sector jobs as late as October 2010, although Ohio had added jobs nearly every month in 2010. It slipped under the 350,000 figure in November that year, BLS data shows.
From January 2011, when Kasich took office, through June of this year, the most recent for which BLS has figures, Ohio gained nearly 354,000 non-farm jobs in the private sector. During that time unemployment has fallen from 9.2 percent in January 2011 to 5.2 percent in June. That has mirrored the national rate, which went from 9.2 percent to 5.3 percent in the same period.
Governors often seek to get credit for good economic news during their tenures, and Kasich is no different.
The jobs gain is part of the record Kasich cites as he argues he is the most qualified candidate in the Republican presidential field. But Kasich was citing the private sector figure even before he announced for president. It is part of a policy rooted in the belief that cutting income taxes and providing tax relief for small businesses will promote job growth.
"We believe that the key to getting Ohio back on track is by building a diverse private sector," Kasich spokesman Rob Nichols said.
Economic experts, though, say that while the job growth is important, the figures for private sector employment are just one part of the picture and don't reveal weaknesses.
"The good news is that we are growing right now. And that is from manufacturing growth," said George Zeller, an economic research analyst in Cleveland. But evaluating the state's economic growth requires more data, he said.
"If we're going to figure out how much improvement we've had in Ohio we have to look at all jobs."
Using that gauge, Ohio is still up nearly 330,000 jobs from January 2011, based on BLS figures.
But public sector jobs -- safety workers, teachers and other government employees -- are down by more than 24,000, and the state still has a net loss of nearly 23,000 jobs since the start of the recession in December 2007, BLS data shows.
"I don't want to discount that we're adding jobs." said Hannah Halbert, a workforce researcher for liberal-leaning Policy Matters Ohio. "It is really great that we've recovered the number of private sector jobs lost.
"The reason that the total number is important is those are still jobs, whether it's the public sector or private sector," she said. "That was still a person earning an income and contributing to the economy."
Richard Vedder, distinguished professor of economics emeritus at Ohio University, argues that the tax reforms are the right course of action, but that there will be some lag time before the benefits begin to show up in the jobs numbers. Meanwhile, Vedder notes that one bright spot in Ohio is growth in per capita personal income, which has outpaced growth in the national average the last three years.
Data from the U.S. Bureau of Economic Analysis shows that Ohio's per capita personal incomes grew by nearly 10.2 percent from 2011-14. The national average grew less than 9 percent.
To be fair, Kasich has often said that Ohio's economy still needs more improvement.
"Don't get me wrong on this. This is not mission accomplished," Kasich said in March after jobs data showed the state had passed the 350,000 mark. "I'm just telling you that for four years I've talked about 350,000 lost private sector jobs. ... Mission accomplished from the standpoint of getting to the 350,000, but that's not the end of our mission."
The data illuminates some of the criticisms levied at Kasich over his efforts to bolster Ohio's economy.
For 32 consecutive months, the state has trailed the national average for monthly job growth, Zeller said. Weak job growth in Northeast Ohio is the key reason, he said, with only one county (Carroll) that has broken even.
Fourteen states have yet to recover all the jobs lost during the recession, Halbert said. Among those, Ohio is closest to breaking even.
Democrats have complained that Ohio has improved because of the national recovery, and criticize Kasich for policies they say are causing Ohio to lag behind.
"John Kasich wouldn't have anything to talk about if Barack Obama hadn't led a national recovery," said David Pepper, chairman of the Ohio Democratic Party. "We've had five years, basically, of having shells moved around. ... When you actually dig down, it has not been good policy. It is not making our economy stronger."
Pepper points to the government jobs figures as an example. He complains that spending cuts and tax cuts at the state level forced job cuts at the local level.
But like all economic data, the government job figures are a complex mixed bag.
One factor Zeller cites is completely beyond the control of state and local governments: the loss of federal jobs in Ohio as a result of spending cuts made in Washington.
The White House reported last October that the deficit shrank to $483 billion for the 2014 fiscal year, the lowest level as a share of the economy since 2007.
Critics continue to chastise the Kasich administration for slashing local government funding in the governor's first state budget, saying the cuts forced layoffs and local tax increases to balance already-strapped local budgets.
The administration counters that the local government cuts were only a small portion of total local funding. Many of those jobs, Nichols argues, were funded by one-time federal stimulus money that the state made clear in the budget process it would not pick up.
As for employment for state government, it is at its lowest point in decades. In the last 30 years, the number of state workers -- excluding those at state universities -- peaked in 1994 when Republican George Voinovich was governor. Then there were more than 68,500 state workers.
The downward trend has spanned both Republican and Democratic administrations. In 2014, there were slightly fewer than 51,800 workers.
"We're proud of the fact that the state government is the smallest it's been in 30 years," Nichols said. "And services are delivered just as efficiently, if not more efficiently, than they've ever been in the past."
Original Article: http://www.cleveland.com/open/index.ssf/2015/08/jo...