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Policy Matters Ohio

State of Working Ohio 2012

September 02, 2012

State of Working Ohio 2012

September 02, 2012

 “Three years into the recovery we’re not making sufficient progress on wages or job growth, and we’re failing to tap the talents of many of our neighbors. Ohio workers and families are not getting what they need from the public or the private sector.”  Amy Hanauer, report author

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Job growth is grim, median wages are falling, disparities endure, inequality is sky-high, unemployment remains troubling, and the share of the unemployed who’ve been jobless for at least half a year is at record levels. This State of Working Ohio 2012 uses the best and most recent data to assess the state of the Ohio labor market. We find that Ohio workers have little to celebrate this Labor Day and some indicators are the worst they’ve been in decades or ever.

Failures by the public and private sector led to the global financial crisis that brought us such a severe and enduring economic downturn. The financial sector lobbied for and got policy makers to shed regulations on financial products. This deregulation encouraged risky lending and allowed lenders to aggressively market exploitative financial products. The ensuing foreclosure crisis destabilized much of our economy and also led to a financial meltdown. The resulting recession was worse in many ways than any downturn since the Great Depression. Three years into what should be a strong recovery, we are still suffering from the effects.

Further, while the recent crisis made things much worse, public and private sector decisions over the past generation have made life harder for the vast majority of America and Ohio that relies on jobs for income. Wages in Ohio are in a generation-long slide; productivity gains no longer help most families; employers have slashed health and pension coverage; unions are under assault, weakening both the voice and leverage that they give to workers; racial disparities have grown; and rising education levels don’t deliver rising wages to the degree that we’d expect.

This Labor Day has slightly better news than the previous two. Unemployment is a bit lower. Manufacturing jobs have grown more than twice as fast as other jobs in the Ohio economy. Durable goods manufacturing, the subsector that includes most automobile and appliance production jobs, has seen particularly strong growth, more than three and a half times as strong as that for the economy as a whole. The American Recovery and Reinvestment Act and the automobile rescue package both helped to revitalize manufacturing; instead of talking about continued devastation of that sector as we had been, we can debate how many positions will be preserved at Lordstown due to plans for the new Chevy Cruze. Unfortunately, layoffs in local government are sucking jobs out of the economy even as manufacturing is adding them.

For the past generation, we’ve cut taxes, reduced regulation, weakened labor market standards, made it harder to unionize, slashed the safety net, and let higher education become more expensive. It has led to an economy where wealth, wages, income and benefits go increasingly to a smaller and smaller share and where all of us have less security and stability. We end the State of Working Ohio 2012 with recommendations about a different approach where opportunity and prosperity are more broadly shared.

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2012Amy HanauerState of Working OhioWork & Wages

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