October 2, 2014

The Kasich Economy: 4 Facts All Ohioans Need to Know

As Governor Kasich continues to insist that he and his allies have engineered an ‘Ohio comeback,” there are four facts  all Ohioans need to know.

Fact # 1: Ohio lags the rest of America in job creation.  Governor Kasich often boasts that Ohio has more jobs now than when Governor Strickland was in office. But since virtually every state has more jobs now than it did during the nation’s “Great Recession”, the real question is how Ohio compares to the rest of the country. Ohio not only ranks 41st among all the states in job creation, but has lagged the national average for 20 straight months. And, unlike the rest of America – which has recovered all the jobs lost during the recession and then some, Ohio is still roughly 140,000 jobs short of where we were in 2007 before the national downturn began.

Fact # 2: Virtually all the jobs created under Kasich have been low-wage. Although Kasich promised that his privatized development agency, JobsOhio, would move “at the speed of business” to create good-paying jobs in the economy of tomorrow, virtually none of the jobs created during his administration pay enough to support a family.  An August 20 analysis by Innovation Ohio found that Ohio’s economy now has more people working in low-paying jobs than in occupations that pay medium or high wages. And an August 31 study by the Cleveland-based think tank Policy Matters-Ohio found that in 2013, Ohio’s median wage was just $15.81 per hour, 90 cents below the national median wage.

Fact # 3: Under Kasich, median income has fallen by $9,000 per household.  An August Associated Press analysis found that Ohio’s real (adjusted for inflation) median household income fell from $54,000 in 2007 to $45,000 in 2012 – a far steeper drop than for the nation as a whole. The AP study also found that nearly 50% of Ohio households are now living paycheck-to-paycheck, and 16% of Ohioans have fallen into poverty.

Fact # 4: The benefits from Kasich’s income tax cuts have overwhelmingly gone to the wealthy. Under the three income tax cuts that have taken effect since Kasich assumed office (including the “final installment” of the 2005 income tax cut that Strickland postponed during the Great Recession), the richest 1% has, on average, enjoyed an annual tax cut of $10,000.  Middle-income Ohioans have received less than $100, and the poorest Ohioans have seen a slight tax increase, thanks to the higher sales and property taxes enacted under Gov. Kasich.  This does not include the lower inheritance taxes now paid by the wealthy due to Kasich’s repeal of Ohio’s estate tax. The estate tax applied to only the richest 7% of Ohioans.

For most Ohioans, Governor Kasich’s so-called ‘Ohio Miracle’ has been a mirage. We’re creating fewer jobs than most other states, the ones we’re creating don’t pay a living wage, and the Governor’s income tax cuts have only served to exacerbate the growing gap between the rich and the rest. Surely our state can do better. [Read more...]

Labor Day Statement from Innovation Ohio President

For Immediate Release: August 29, 2014
Contact: Dale Butland, 614-783-5833

Labor Day Statement from Innovation Ohio President
Anti-labor policies, tax-shifting trend increases income inequality and threatens Ohio’s middle class, says McCarthy

COLUMBUS – In advance of the Labor Day weekend, Innovation Ohio President Keary McCarthy released the following statement:

“Labor Day is a celebration of the American labor movement and the workers who fought for it. Every year, we honor the contributions of labor unions because they built the greatest middle class the world had ever seen. But every year it also becomes increasingly difficult to think about the middle-class without considering the sobering fact that it’s disappearing. Growing income inequality is one of our nation’s and our state’s biggest challenges.

“Over the last several decades, the wealthiest Ohioans have seen their earnings grow by 70 percent while working- and middle-class families have seen their earnings decrease.  Nationally, as labor union participation has declined over the last fifty years, the gap between the rich and the poor has widened.

“Ohio’s elected leaders must make it a priority to reverse these trends. Stop making it harder for Ohioans to participate in labor unions. Stop the tax-shifting trend that benefits those at the very top at the expense of everyone else. Without pursuing these basic fixes to Ohio’s economy and a policy agenda that puts the middle class first, Ohio’s income inequality will grow and the promise of the American dream will continue to slip away.” [Read more...]

Ohio’s Low-Wage Recovery

pie_chart_forsocial
Research Overview

While much has been made of state job gains and reductions in the state’s unemployment rate, Ohio’s economy employs nearly 140,000 workers than it did prior to the 2008 recession. Innovation Ohio sought to explore the jobs that have been created during the state’s recovery and see whether they are comparable to those that were lost.

By reviewing occupational employment data from the Bureau of Labor Statistics from 2007 to 2013, we found that:

  • Prior to the start of the recession in 2007, 33% of Ohioans were employed in occupations that pay, on average, more than $20 per hour, 39% in jobs paying between $13.40 and $19.99, and just 28% in jobs paying $7.00-$13.39 hourly.
  • At the end of 2013, low-wage occupations had jumped to 36% of Ohio employment, while medium-paying jobs fell to 34% and high-wage occupations dropped to 31%.

Digging deeper into the numbers, we found that all the job gains in Ohio have come from low-wage occupations. Employment in high and medium wage occupations declined during the recession and continued to fall as the recovery began. Low wage professions now represent 36% of the state’s employment, up from 28% in 2007.

Read the report.

Read the press release.

Acknowledgements

Heather Madonia, Ph.D. candidate, Northwestern University served as principal researcher in preparing this analysis.

Kasich Recovery Yields Low-Wage Jobs

For Immediate Release: August 20, 2014
Contact: Dale Butland, 614-783-5833

IO: Kasich Recovery Yields Low-Wage Jobs
Think Tank Study Says High & Medium Wage Jobs Decrease; Newly Created Jobs “Don’t Pay Enough to Support a Family.”

Columbus — Innovation Ohio, a progressive think tank headquartered in Columbus, released a new study today which finds that for the first time since 2007, Ohio now has more low wage jobs than medium or high wage jobs.  Using Occupational Employment data from the U.S. Labor Department’s Bureau of Labor Statistics, the study also found that while 9 out of 10 Ohio jobs lost during the Great Recession paid medium or high wages, low-paying jobs account for virtually all Ohio job growth during the recovery.

Specifically:

  • Prior to the start of the recession in 2007, 33% of Ohio jobs paid more than $20 per hour, 39% paid between $13.40 and $19.99, and just 28% paid $7.00-$13.39 hourly.
  • At the end of 2013, low-wage positions had jumped to 36% of Ohio jobs, while medium-paying jobs fell to 34% and high-wage jobs dropped to 31%.
  • As a share of the state’s economy, high and medium wage jobs dropped from 72% in 2007 to just 64% in 2013.  Low wage jobs grew from 28% to 36% during that period.

Said IO President Keary McCarthy:

“This report makes clear that Gov. Kasich’s handling of Ohio’s economic recovery warrants serious scrutiny. Not only has the recovery from the great recession been slow and inconsistent, but for the first time since 2007 low-wage jobs now comprise the highest share of the job market.”

Added IO Communications Director Dale Butland:

“Last month, Ohio led the nation in job losses.  Ohio’s job creation rate ranks 41st and has lagged the national average for 20 straight months. Unlike the rest of America, Ohio is still 140,000 jobs short of where we were before the recession hit.  And if all this isn’t bad enough, today we learn that the few jobs Gov. Kasich has managed to create don’t pay a living wage or enough to sustain a family. Some miracle. Some recovery. “

Read the report.

Ohio Ranks 32nd Among States in Job Creation

February employment data for state and local areas was released this morning and reveals that Ohio continues to lag most of the nation in creating new jobs. In February, 5.28 million Ohioans were employed, which is 50,000 more than the 5.23 million Ohioans employed at the same time in 2014. But it represents just 1% annual growth, which ranks Ohio just 32nd among all 50 states for job growth in the past year:

50-state rankings

This is a drop from Ohio’s rank of 27 in last month’s tally of 12-month job growth.

Governor Kasich continues to insist that another income tax cut is what Ohio needs to attract business and create jobs, but the data do not support that. Looking at job growth from February, 2013 to February, 2014, Ohio was outperformed by six of the ten states identified by the conservative Tax Foundation as having the “worst” business tax climates (look no further than high-tax California, which ranked #8 in creating new jobs).

It’s clear that tax rates in Ohio are not the only factor holding us back.

Ohio lost jobs in February, lags the nation in job creation

Today, February employment data was released that shows the state’s unemployment rate reaching 6.5 percent, its first dip below the national rate since July. The decline suggests job-seekers are leaving the job market, because the number of Ohioans with jobs actually declined.

In February, the number of Ohioans with jobs decreased by 4,600, with large declines reported in construction and local government. Job numbers for January were also revised downward. As a result, Ohio continues to lag the national rate of employment gains since Governor Kasich took office — just 4.3% compared to 5.3% for the US as a whole.

3.21.14 february jobs

New Employment Data Shows Ohio Still Underperforming

Yesterday, the US Bureau of Labor Statistics released its monthly regional and state employment figures, showing Ohio gaining 16,700 jobs in January and the unemployment rate dropping to 6.9 percent. Also incorporated into the January numbers were revisions to 2013 data to reflect the results of the Bureau’s annual benchmarking process. The revisions are good news for Ohio, showing that 68,000 more Ohioans were working in 2013 than had been previously reported.

So, what can we now conclude about job-creation in the state since the recession? That Ohio’s growth is not as bad as it had looked before – when monthly reports showed Ohio consistently in the bottom five among states in yearly job creation – but not as good as it could be. Ohio falls squarely in the middle of the pack among states in adding jobs, and lags the nation as a whole in both employment gains and in reducing the ranks of the unemployed.

Here is how Ohio’s job growth measures up against the nation as a whole:

ohio-vs-us

[Read more...]

In October, Ohio’s economy continued to lag rest of nation

New data released by the Bureau of Labor Statistics (BLS) paints a picture of a continued stall in Ohio’s economy. BLS and Ohio Jobs and Family Services found that not only did Ohio’s unemployment rate tick up to 7.5%, but that compared to October, 2012, in October, Ohio grew jobs by a dismal .53%.  Over the last year, North Dakota led all states by growing 3.53 percent while Ohio ranked 44th – only five other states grew more slowly over the last 12 months.

[Read more...]

Half of Ohio’s House members voted to keep government shut down, default on debts

Late yesterday, a deal was reached to end the federal government shutdown and avert a financial crisis by providing short-term government funding and an increase of the country’s debt ceiling, allowing the government to make good on its financial obligations.

final vote

Notably, Ohio’s John Boehner, Republican Speaker of the House, brought the plan to the floor and voted for its passage. In voting yes, Boehner was joined by the state’s four Democratic House members and Republicans Joyce, Tiberi and Stivers. Eight of Ohio’s twelve Republican Congressmen, however, voted no, joining with the far-right Ted Cruz-aligned wing of the party.

Eight of Ohio’s twelve Republican Congressmen voted to keep the government shutdown and default on the nation’s debts — despite warnings that doing so would be devastating to the country’s economy.

Both US Senators — Brown and Portman — voted to end the shutdown. [Read more...]

Government Shutdown will have significant impact on Ohio’s economy

For months, Congressional Republicans have threatened that unless Democrats negotiate over the implementation of the Affordable Care Act, they will not pass a new spending bill to fund the federal government. Last night at mid-night, Republicans followed through on their threats and President Obama was forced to shut down the U.S. government for the first time since 1995.

A shutdown of the federal government will have real effects on the U.S. economy and here in Ohio. The White House estimates that a week-long shutdown will cost the U.S. economy $10 billion but that number could increase the longer the shutdown drags on. According to research released by Congressional Democrats, this shutdown will have significant effects on middle-class families and small businesses here in Ohio.

  • 52,000 federal employees in Ohio will be furloughed. These workers may see reductions in their pay from the time they were forced to stay home because the government was shuttered. This means less money in the pockets of these workers to pay for all sorts of services and goods from businesses in their communities.
  • A shutdown could delay support for a portion of the 186,000 small businesses in Ohio. The federal Small Businesses Association administers small business loans and a shutdown would put a stop to this critical source of business credit for thousands of small businesses in Ohio.
  • In Ohio, over 25,000 people are employed through the Department of Defense as civilian employees and half of them will be furloughed without pay while the rest would continue to work for delayed pay.
  • Checks for current Social Security benefits will continued to be delivered during the shutdown but it is unclear what would happened for new benefits or other services offered to seniors. During the last shutdown 112,000 claims for Social Security and disability were not taken. In Ohio, 2.2 million individuals received Social Security benefits in 2012.
  • During the 1995 shutdown, more than 400,000 veterans saw their disability benefits and pension claims delayed and it is unclear whether this will also happen this time. Currently, Ohio has 877,000 veterans who may experience some sort of delay.

Congressional Republicans’ demands to negotiate over the ACA are irresponsible and reckless and are putting the nation’s economy, and Ohio’s economy, at risk to advance their political agenda. It is time that Republicans in Congress stop threatening the future of Ohio’s middle-class families and pass legislation to fund the government’s operations.