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Ohio Is in Even Worse Shape Than We Thought


The U.S. Bureau of Labor Statistics, in its March 2010 employment data, revised its state employment numbers going back to 1990. The Buckeye Institute’s 2010 “State of the State” report [PDF] highlighted several sobering pieces of BLS employment data, but, according to these new numbers, the outlook for Ohio is even worse than we thought.
Specifically, between January 1990 and January 2000, Ohio’s job market added 714,900 jobs, which was the 37th best in America. But between January 2000 and January 2010, Ohio’s job market lost 635,000 jobs — the second-worst numbers in the country.

All told, Ohio had the third worst job market in America in the last twenty years. Only Rhode Island, Michigan, and Connecticut fared worse. (The Buckeye Institute’s original “State of the State” report had Ohio’s job market only sixth from the bottom.)

What’s worse, Ohio is fourth from the bottom in ratio of private jobs created to government jobs created. For every 1.19 private-sector jobs added to the state’s economy over those 20 years, Ohio added 1 government job, a performance outdone only by New Jersey and bottom-of-the-list regulars Connecticut and Michigan.

Looking at the state’s ten industry sectors, there are fewer jobs today than there were in January 1990 in five sectors: Mining & Logging; Construction; Manufacturing; Information; and Trade, Transportation & Utilities. Four more industry sectors have lost jobs since 2000: Financial Activities; Professional & Business Services; Leisure & Hospitality; and Other Services.

Only Education & Health Services — the sector tied to government spending in K-12 schools, higher education, and health care — has more jobs today than in 2000 or 1990.

Finally, when comparing states based on their labor policies, right-to-work states saw an average increase in jobs from 1990 to 2010 of 36 percent — twenty points higher than the 16 percent seen in states that force workers to join a union. The bottom fifteen states in terms of job growth are all forced-unionization states, and 22 of the bottom 26 are. Ten of the top fifteen states have right-to-work laws.
Given this troubling revision of BLS data, the issues raised in our report are more critical than ever. This new employment data, when seen in light of the high tax burden and the explosion of government worker compensation noted in our report (not to mention the state’s projected budget deficit of $4-8 billion), requires far bolder and more specific action than we have heard thus far from Ohio’s leaders — and those seeking to lead us.

The question of the day is how this data will impact Ohio’s gubernatorial race. Conventional wisdom says the numbers support John Kasich’s narrative that Ted Strickland is not providing the leadership to turn Ohio around and that Kasich’s experience in balancing the federal budget is exactly what Ohio needs in a governor. Current polling supports this view.

The “but” here involves two pieces of baggage. First, the data strongly supports Strickland’s narrative that he inherited an enormous mess from the Republicans who had total control of state government from 1995 to 2006. He has a strong case — government grew substantially more during those years than during his first term. Secondly, Strickland will work very hard to tie Kasich’s years at now-defunct Lehman to the financial crisis that hit America — a “Blame Wall Street” move. This argument, although aided by Kasich’s refusal to release his pre-2008 tax returns, has thus far been undermined by news stories about the role Kasich played at Lehman. Fundamentally, Strickland runs the risk of looking like a governor who’s good at pointing fingers but not so good at providing solutions.

The bottom line: Things in Ohio will get more interesting as the months roll by.

Matt A. Mayer is president of the Buckeye Institute.


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