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January 17, 2015

Saturday Morning Politics Thread: It's the Economy, Stupid [Y-not]

As I was looking for inspiration on what to cover next, I decided to double-check the exit polling from 2012. Voters claimed their top issue was "the economy":

The early exit poll results show the economy is the number one issue on voters' minds. Sixty percent called it the most important issue. Health care is a distant second at 17%. It's followed by the deficit at 17% and foreign policy at 4%.
Twenty-four percent of the voters in this exit poll say their family's financial situation is better today than it was four years ago. Thirty-four percent say it's worse today while 41% say their financial situation is the same.

Likewise, the economy was the top priority for voters from the 2014 midterms. Per the WSJ's exit polling:

WSJ screenshot.jpg

Here's some more exit poll analysis of the 2014 midterms from Breitbart.

We covered the "fiscal scorecards" for each candidate several months ago (Mike Pence's is here), but in trying to address voters' concerns about the economy, I think we should look at factors that hit voters' household budgets. I suspect that's what most voters mean when they refer to "the economy". My thought is we should address things like the job market, wages, taxes, interest rates, and inflation. I'm open to other suggestions.

We've discussed energy issues, which also hit close to home, during the past two weeks: here and here.

Health care appears as a separate issue in most of this exit polling, so we'll treat that separately, too.

So let's start with jobs and wages. We'll cover results first and then move to policies enacted (or proposed) by the candidates that influence those results. What follows is just a sample of data for each state from which the prospective candidates hail. It's by no means exhaustive. Feel free to chime in with additional data you think we should be considering.


Job creation and unemployment

The Joint Economic Committee of the U.S. Congress provides State-by-State Snapshots showing "the major economic indicators in all 50 states and the District of Columbia in the areas of jobs, unemployment, exports and housing." A few highlights for each of prospective candidates' state below:

Wisconsin (Gov. Scott Walker)

* Wisconsin private-sector employers have added 180,100 jobs (an increase of 7.8 percent) since February 2010, the national low point for private-sector employment.
* In Wisconsin, the following sectors have posted the largest job gains since February 2010: manufacturing (49,400 jobs), professional and business services (43,300 jobs) and education and health services (26,000 jobs).
* The unemployment rate in Wisconsin was 5.2 percent in November 2014, down 0.2 percentage point from October. The rate is down 1.2 percentage points from one year earlier and is below its recent peak of 9.2 percent in January 2010.

Wisconsin lags behind its neighbors in jobs, according to the Wisconsin State Journal:

Over the past decade, Wisconsin has mostly ranked in the middle of all states for employment growth. Among Midwestern states, Wisconsin was once among the leaders, but in recent years that trend has changed.

(Click through for a chart comparing Wisconsin to other Midwestern states in job growth rankings -- it's too big to reproduce here. Wisconsin is currently dead last in the Midwest and 32nd overall. It was 34th in 2013 and 40th in both 2012 and 2011.)

Finally, Politifact evaluated Walker's fulfillment of his 2010 campaign promise to create 250,000 new jobs in his state:

[W]e use the Quarterly Census of Employment and Wages, which surveys nearly all state businesses to get the most accurate picture for Walker's first three years in office. We then combine that with monthly survey data - which comes from reports gathered from a small percentage of state businesses - to provide the most up-to-date picture for where things stand.
The latest report brings the total to 137,695 jobs added since Walker took office and, for the first time, the tally exceeds 50 percent of the governor's promise. To meet the promise, there would have to be another 112,305 jobs added in December - more than the first three years combined.

Although the tally was made with a couple of months to go, I believe the governor conceded in an interview (whose link I lost, sorry!) that he was going to fall short on this promise.

Texas (Perry, Cruz)

* Texas private-sector employers have added 1,486,900 jobs (an increase of 17.7 percent) since February 2010, the national low point for private-sector employment.
* In Texas, the following sectors have posted the largest job gains since February 2010: trade, transportation and utilities (327,400 jobs), professional and business services (292,900 jobs) and leisure and hospitality (209,200 jobs).
* The unemployment rate in Texas was 4.9 percent in November 2014, down 0.2 percentage point from October. The rate is down 1.2 percentage points from one year earlier and is below its recent peak of 8.3 percent in March 2010.

Even WaPo's Jennifer Rubin is impressed (although naturally she can't resist using this article to pimp for illegal immigration).

Time will tell how the drop in oil prices affects Texas' economy, but last month it was still holding its own on the jobs front:

Seven of Texas' 11 major industry groups added jobs in November, led by 13,500 jobs in professional and business services. In addition, education and health services added 7,200 jobs and leisure and hospitality added 6,000 jobs, manufacturing gained 4,500 and construction added 3,600.
Energy was one of the four industries to see jobs decline in November, losing 2,300 jobs. The price of crude oil has fallen by nearly in half since June, which benefits consumers in terms of lower gasoline and other energy costs, but can hurt oil-related companies.
Still, Texas overall energy industry job count at 323,800 people is near its all time high of 326,100 reached in October.

Louisiana (Gov. Bobby Jindal)

* Louisiana private-sector employers have added 146,700 jobs (an increase of 9.7 percent) since February 2010, the national low point for private-sector employment.
* In Louisiana, the following sectors have posted the largest job gains since February 2010: trade, transportation and utilities (32,700 jobs), leisure and hospitality (28,900 jobs) and education and health services (27,500 jobs).
* The unemployment rate in Louisiana was 6.5 percent in November 2014, up 0.3 percentage point from October. The rate is up 0.9 percentage point from one year earlier but remains below its recent peak of 7.8 percent in November 2010.

Last October The Advocate reported News good for Louisiana job growth, but bad for unemployment rate:

LSU economists Loren C. Scott and James A. Richardson issued a two-year business forecast that included a prediction that "sometime in 2015, Louisiana will have more than 2 million nonfarm employees for the first time in its history."
Richardson and Scott noted more than $103 billion in industrial development and expansion is either under construction or at the front-end engineering and design phase in Louisiana...
...[T]he state's construction sector added 11,000 jobs over the year ended Sept. 30, the most of any sector.
Leisure and hospitality was second, adding 9,500 jobs. Professional and business services added 9,200. Trade, transportation and utilities added 5,800.
The information sector lost 1,500 jobs, as did the mining and logging sector, which includes jobs in the oil and gas industry.
Government agencies lost 5,800 jobs in Louisiana. State government shrank by 4,100 jobs, and local government dropped 1,500 jobs.

(Emphasis mine.)

South Carolina (Gov. Nikki Haley)

* South Carolina private-sector employers have added 163,900 jobs (an increase of 11.3 percent) since February 2010, the national low point for private-sector employment.
* In South Carolina, the following sectors have posted the largest job gains since February 2010: professional and business services (50,100 jobs), leisure and hospitality (32,600 jobs) and manufacturing (30,500 jobs).
* The unemployment rate in South Carolina was 6.7 percent in November 2014, holding constant from October. The rate is down 0.1 percentage point from one year earlier and is below its recent peak of 11.9 percent in December 2009.

Late last year South Carolina set employment records:

[T]he number of state residents who are working reached another record high, according to a report from the S.C. Department of Employment and Workforce Friday. As job seekers have flooded the market, the state’s unemployment rate remained unchanged from October at 6.7 percent.
The national unemployment rate also was unchanged at 5.8 percent.
It is the third month in a row that the workforce in South Carolina reached historic highs and job creation kept up with people entering the job market.

New Mexico (Gov. Susana Martinez)

* New Mexico private-sector employers have added 30,000 jobs (an increase of 5.0 percent) since February 2010, the national low point for private-sector employment.
* In New Mexico, the following sectors have posted the largest job gains since February 2010: mining and logging (10,600 jobs), education and health services (10,200 jobs) and trade, transportation and utilities (8,000 jobs).
* The unemployment rate in New Mexico was 6.4 percent in November 2014, down 0.1 percentage point from October. The rate is down 0.3 percentage point from one year earlier and is below its recent peak of 8.0 percent in November 2010.

New Mexico appears to have lagged behind other states in its recovery:

...2014 saw positive job growth after years of shrinkage and stagnation, while neighboring states bounced back faster.
Statewide, more than 14,000 new jobs were created this year -- 700 of them in construction, which had been absolutely crushed during the recession.
The biggest gains were in education, which grew even during the hard times, and health care. Between the two, the sectors gained more than 6000 new jobs in 2014.

Indiana (Gov. Mike Pence)

* Indiana private-sector employers have added 250,200 jobs (an increase of 10.7 percent) since February 2010, the national low point for private-sector employment.
* In Indiana, the following sectors have posted the largest job gains since February 2010: manufacturing (83,000 jobs), professional and business services (55,200 jobs) and trade, transportation and utilities (38,300 jobs).
* The unemployment rate in Indiana was 5.7 percent in November 2014, holding constant from October. The rate is down 1.2 percentage points from one year earlier and is below its recent peak of 10.8 percent in June 2009.

Indiana leads the U.S. in manufacturing jobs:

Indiana leads the nation in manufacturing job growth over the past year, according to the U.S. Bureau of Labor Statistics. The state gained 13,700 factory jobs over the past 12 months, 700 more than second-place Texas.

Employment in the manufacturing sector, which remains more heavily concentrated in Indiana than any other state, grew by 2.8 percent over the past year.
"As Indiana champions innovative partnerships and economic incentives, these numbers come as no surprise," state Sen. Brandt Hershman said. "Every day, our low-tax, job-friendly environment draws more employers to Indiana and away from unfavorable states like our neighbor, Illinois, which ranked dead last for manufacturing job growth. As state leaders continue to work hard to attract job opportunities for Hoosiers, I anticipate these trends will continue."
Illinois lost 8,900 manufacturing jobs over the past year, the steepest decline in the country.


Household Income

So that's a snapshot of the jobs climate. What about wages? Here's a report that came out last year summarizing the median household income by state:

The median US income in 2013 was $51,939, up from $22,415 in 1984 -- a 131.7% rise over the 29-year timeframe. However, if we adjust for inflation chained in 2013 dollars, the 1984 median is $47,866, and the increase drops to 8.5%.

The Latest Data and Peak Income Years

The peak annual median income for the US, adjusted for inflation, was in 1999. The latest data point, fourteen years later -- after two recessions and two market crashes -- is down 8.7%. Here is a alphabetically sorted table showing the data for the 50 states and DC along with the US median data:

MedianHouseholdIncomes.jpg

The median household incomes in 17 states plus DC have fared better than the US median as measured by the real percent declines from their respective peak years. A total of 33 states have suffered greater declines, with eight states dropping more than 20%, up from four in the 2012 data. Nevada is the biggest loser, down a whopping 26.7% since its real median income peak in 2000.

Follow the link for more. Here's how the states we're tracking performed: Texas experienced the smallest drop from peak income (-2.0% from its peak in 1999) and Louisiana experienced the largest (-19.7% from its peak in 2009). The others' median income changes were: IN -11.5% from its peak in 1999; WI -13.4% from its peak in 1999; SC -14.6% from its peak in 1996; and NM -15.5% from its peak in 2007. By the way, NJ is down 21.4% from its peak. The worst-performing state in the country was Nevada. The best-performing was Texas.


Obviously, job growth and household income are not the only two parameters people consider when they think of "economy," but I think it's fair to say they are significant.

Advantage: Texas... and Rick Perry, in particular.


Previous "issues" threads:

Energy here and here.

Common Core

"Fiscal Scorecards" for each candidate (Mike Pence's is here)

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posted by Open Blogger at 08:50 AM

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