After inheriting a recovery, Kasich’s policies have stalled Ohio

COLUMBUS – This morning, the Ohio Department of Jobs and Family Services released the August jobs report and revised July figures for Ohio. After losing nearly 3,000 jobs in May, the revised July figure showed Ohio lost 8,600 jobs. 

For the sixth consecutive month, Ohio’s labor force shrank, keeping Ohio’s labor participation rate below the national rate (which is the real reason why Ohio’s unemployment rate manages to be below the national rate).   This is fourth straight month that the number of employed Ohioans has shrunk as well.

Ohio lost 6,600 in trade, transportation, and utilities and another 3,500 jobs in construction in August.  Ohio’s unemployment rate stayed the same, which is at the same level it was in April 2014.  Ohio created a net of only 200 jobs.  Ohio’s job creation rate for the past twelve months is half of West Virginia’s and nearly a third of Kentucky’s or Michigan’s, according to the Governor’s Office of Budget and Management.  [Source: Ohio Office of Budget & Management, September Monthly Financial Report, pg. 4]

In response to this month’s economic data, Ohio Democratic Party Chairman Chris Redfern released the following statement:

“When John Kasich came into office, Ohio was already nearly a year into a strong economic recovery that was lowering the unemployment rate by creating jobs. With Kasich behind the wheel, Ohio is stuck in neutral while the Governor entertains delusional fantasizes of being President.  Kasich’s policies have failed to create the jobs Ohioans need, all while shifting the tax burden onto middle class families.”

WHAT OTHERS HAVE BEEN SAYING ABOUT OHIO’S LAGGING ECONOMY:

After calling the July jobs report “disappointing,”  “July 2014 was the 21st consecutive month when Ohio’s job growth was slower than the U.S. national average, with the gap between Ohio’s rate and the U.S. rate increasing in July.” – Economic Research Analyst George Zeller.  [Source:Cleveland Plain Dealer (8/15/2014), “Ohio lost 12,400 jobs in July: Unemployment rate up to 5.7%.”]

“About the only thing that’s made the numbers look good at all is the decline is the decline in the labor force.”—Economist Bill LaFayette, owner of economic consulting firm Regionomics.  [Source: Columbus Dispatch(8/16/2014), “Blip or start of a trend? Jobless rate rises to 5.7%.”]

“Ohio hasn’t had the big rebound like other states.”—Michael Wolf, an economist with Wells Fargo & Co. [Source: Columbus Dispatch(6/21/2014), “Ohio’s jobless rate of 5.5% lowest since April 2007.”]

BACKGROUND

For the 21st straight month, Ohio’s job creation rate has been lower than the national average.  In reaction to the July jobs report, economic research analyst George Zeller noted, “July 2014 was the 21st consecutive month when Ohio’s job growth was slower than the U.S. national average, with the gap between Ohio’s rate and the U.S. rate increasing in July.” [Source: Cleveland Plain Dealer (8/15/2014), “Ohio lost 12,400 jobs in July: Unemployment rate up to 5.7%.”]

Job creation under John Kasich in Ohio has lagged U.S. job growth. In fact, at least 8 other governor’s terms since 1959 have seen stronger job growth than Ohio has seen so far under John Kasich.  [Source:  Cleveland Plain Dealer (8/5/2014), “Ohio lags U.S. jobs growth, as it has under a half-century of governors from John Kasich to Michael DiSalle.”]

When Kasich was elected Governor, Ohio’s job creation rate was nearly twice that of the national rate.  Now, Ohio’s ranked 38th in job creation.  In November 2010, Ohio’s job creation rate was 1.02% compared to the national average of  .54%.  Now, Ohio is ranked 38th in the nation with a job growth rate  (.83%) lower than it was in 2010. [Source: Arizona State University, W.P. Carey School of Business, “Job Growth USA” website (accessed 6/23/2014)]

Ohio actually had more jobs in April than July.  According to the U.S. Department of Labor Bureau of Labor Statistics, Ohio had more jobs in April than it reported in July.  [Source: Bureau of Labor Statistics (CES Survey, seasonally adjusted numbers (accessed at 8/18/2014).]

In 2010, Ohio created over 55,000 new jobs — more than it did in 2013 under Kasich.  According to the U.S. Department of Labor’s Bureau of Labor Statistics, Ohio created 55,100 jobs in 2010, a year before Kasich took office, while only creating 50,400 jobs last year.  [Source: U.S. Department of Labor, Bureau of Labor Statistics, CES Survey, seasonally adjusted (accessed 5/8/2014)].

Job gains under Kasich are in lower paying industries than the jobs lost in the recession.  “Weekly hourly earnings in the industries that showed employment gains since the recession in Ohio range from $12 to about $25 per hour,” [Veronica Kalich, an economics professor at Baldwin Wallace University] said, adding that professional and business services came in a little higher. “Employment has not recovered in the higher paying jobs.”  [Source: Cleveland Plain Dealer, (7/7/2014), “Ohio has not recovered 120,000 jobs lost since the recession: some say number higher.”]

Unemployment rate drop has been fueled by people leaving the workforce, not job creation.  Since Kasich took office, Ohioans labor market has shrunk by 91,000.  According to the Bureau of Labor Statics, 91,000 Ohioans have dropped out of the labor market since Kasich took office. In 2014 so far alone, over 43,000 Ohioans dropped out of the labor market. [Source: U.S. Department of Labor, Bureau of Labor Statistics, LAUS Survey, seasonally adjusted (accessed 8/15/2014)]

Nationally, the country now has more jobs than it did at its pre-recession level.  With today’s national jobs report for May, the country now has more jobs than it did before the 2008 recession.  [Source: New York Times(6/6/2014), “In Jobs Report, Two Milestones.”]