Blue-State Employment Blues

[w¡n9Nµ7 §£@¥€r 123]

Bears and partisans are exuberant about the August employment report, which recorded a loss of 4,000 jobs in a labor market that employs 138 million. Employment, according to the Bureau of Labor Statistics, was “essentially unchanged,” with losses concentrated in the manufacturing (-46,000) and government (-28,000) sectors. This was no surprise: Manufacturing has contracted in August in eight of the last ten years, dating back to the Clinton era.

Employment is a broad economic indicator, and last Friday’s less-than-stellar report deserves attention. But another monthly BLS report on regional and state employment offers a view of the jobs market through an alternative lens. In particular, this report allows one to compare employment growth between the so-called Blue and Red states.

Political pundits identify 18 bona-fide Blue states, which backed Democrats Al Gore in 2000 and John Kerry in 2004, and 29 clear-cut Red states, which supported Republican President George W. Bush both times out. Blue states are said to be “liberal,” and Red states “conservative.” But there might be another reason to term certain states “blue”: weak employment growth in a period of expansion.

Total Blue-state employment growth has been only 3.3 percent during the current expansion, which began in November 2001, compared with the U.S. rate of 5.5 percent. Meanwhile, total Red-state employment growth has been 7.5 percent, more than double that of the Blue states.

...

Job growth has trailed the U.S. average in 13 Blue states. California, the largest Blue-state labor market, fell behind by the narrow margin of less than a half-percent, while growth has been slower in Rhode Island (5%), Minnesota (4.1%), Wisconsin (3.1%), New York (2.8%), New Jersey (2.7%), Pennsylvania (2.7%), Vermont (2.3%), Maine (2.1%), Connecticut (1.5%), Illinois (1.1%), Massachusetts (-0.2%), and Michigan (-5%). The job losses in Michigan and Massachusetts have been the most severe, falling below 2001 levels.

Regionally speaking, this blue-streak continues. The Great Lakes, Mid-Atlantic, and New England regions, all predominantly Blue, have trailed the U.S. jobs-growth average. The only Blue region to beat the average has been the West, fueled by above-average jobs gains in Hawaii (15.2%), Washington (9.5%), and Oregon (9%). Two other Blue states — Delaware (5.8%) and Maryland (6.1%) — also have bested the U.S. average.

Now for the Red team:

Of 29 certified Red states, a full 18 have topped the U.S. jobs-growth rate. And here an interesting trend appears: Red states with no income taxes — Nevada (25.7%), Wyoming (15.2%), Florida (13.9%), Alaska (10.2%), Texas (9.1%), South Dakota (8.3%), and Tennessee (5.5%) — have all witnessed above-average job growth.

Not surprisingly, three of four Red regions have led the U.S. in job growth: Red states in the West have expanded 15.9 percent followed by the Plains (7.7%) and the Southeast (7.5%). The only Red region to trail the U.S. jobs-growth average has been the Midwest (1%).

This trend is not new. It has merely been overlooked by the mainstream media. Labor is colorblind in the political context of Red and Blue states. And as long as the Red states let Americans keep more of what they earn, jobs will unevenly flow their way.

http://article.nationalreview.com/print/?q...DM2YWY1YWI2MTE=

[YuAndDan 153]

Yep I am one of those living in a damn Democrat state, actively looking elsewhere for work, the job market is very depressed, and I blame it on the Dem's with their welfare mentality that only keeps raising the income tax to support loosing programs, half my income is sucked away by income taxes.

[russ 1]

This trend is not new. It has merely been overlooked by the mainstream media. Labor is colorblind in the political context of Red and Blue states. And as long as the Red states let Americans keep more of what they earn, jobs will unevenly flow their way.

Exactly why I moved out of Massachusetts. Cost of living is much higher, and the tax burden is much worse. Salaries are higer there, but higher salaries tend to reduce employment. (Employers would prefer lower-cost workers in other states).

I think the more important statistic would be migration -- while jobs are not being created in Mass, people are leaving as well. Florida (where I live) still attracts a lot of people to move here. The low cost of living and (currently) glut of real estate makes the state more attractive to both employers and workers.

There are other business-friendly things that come into play as well. Capital gains taxes tend to force wealthy people out of a state. This hurts job growth.

[Caladan 19]

I'm a little skeptical that's it's just the welfare state of the Blue states driving away job. Many states that go Red in elections have Blue governors, and vice versa, and I'd guess that state and local day-to-day taxes would make up the majority of the differential effect on businesses.

Doesn't explain the West's success (or are we forgetting the dotcom boom in liberal California now?) and I think I'd blame auto industry woes for Michigan. People are also moving out of the coasts for cheaper real estate and bringing their business skills with them.

Most of the states on the Eastern seaboard that have slow-but-positive growth seem to be bedroom communities for the big cities. Woo, Connecticut has slow growth. It also has people who could buy Wyoming; their jobs are just in NYC.

[Anna C. 4]

There might be a dotcom boom in CA, and it is good to start out here after college, but as soon as you have enough years of experience lots of people move out of CA. The only reason for not having a negative growth rate is immigration here.

If you have enough experience you get a similar salary in places like SC, FL or other states - but you get a whole lot more for your money there!!! Way less taxes, way BETTER schools (CA school are so terrible I have no word for it - why are they sending them at all to school if they get taught next to nothing but political paroles?!), a house for less than $1,000,000 but actually more than one bathroom and a REAL yard, not just those 10 square feet you share with your neighbors.... The list goes on. We know so many people with young kids who moved away - they have all those advantages in the red states and end up with more money at the end of the year.

And to prove that the welfare programs lower overall incomes - just look at Europe. What I am earning now makes all my friends so jealous - they have to pay over 50% for social security and taxes while getting a health care that is way below what I have now (waiting for surgeries, so many services not covered and yet 14% of their salary goes towards it). And it is forced on them, they readily would pay for a private insurance - which is only available if you make more than 4000 Euros a months - a salary most people dream of (and yes, most people who have college degrees dream of that as well!!!!!).

Also I worked in NYC and have lots of friends there - they all are moving out as fast as they can to states where their families have a better life.

The big places like NYC and the Bay Area attract simply people like me and DH - we are just starting out and collecting our experience. After this, good bye it is and hello WY or similar places where people do not pester us for doing whatever we want (we do not smoke, but a neighbor city just banned it altogether - a huge BS in my eyes - what will the ban next - all non-hybrid cars? - all hydrogenated foods - even if I wanna eat it????)...

Well jsut my 3 cents and experience from a big family...

Edited September 17, 2007 by Anna C.

[Trompe le Monde 1,107]

this is a silly argument, the governor of a state has far more influence over the state's economic success than who they vfote for president:

- the governor of "blue" California for all but 4 of the 15 past years has been a Republican

- for New York, Pataki - a Republican - was governor from 1995-2007

- for liberal Massachusetts, the first Democratic governor only came to office this year after 15 years of REpublican rule

etc etc etc

Edited September 17, 2007 by robinklake

[Caladan 19]

But they're 'certified' Red States, robin! (Shorter: the National Review sure is good at pulling stuff out of its ###...)

[almaty 19]

this is a silly argument, the governor of a state has far more influence over the state's economic success than who they vfote for president:

- the governor of "blue" California for all but 4 of the 15 past years has been a Republican

- for New York, Pataki - a Republican - was governor from 1995-2007

- for liberal Massachusetts, the first Democratic governor only came to office this year after 15 years of REpublican rule

etc etc etc

true..but logic is seen as a vice here...brother

[russ 1]

- the governor of "blue" California for all but 4 of the 15 past years has been a Republican

- for New York, Pataki - a Republican - was governor from 1995-2007

- for liberal Massachusetts, the first Democratic governor only came to office this year after 15 years of REpublican rule

Well, the Republican governers in blue states are far more moderate than the ones in red states. They also tend to have Democrats controlling the State House & Senate seats.

A wise man from Massachusetts is famous for saying "All politics is local." (Tip O'Neill). Republicans in Blue states still have high taxes, and Democrats in Red states tend to have lower taxes. The state legislatures are really the ones controlling this, not the governers.

The social states in Europe are generally better for the less well educated, but they come with a price of high unemployment, high taxes, and low salaries. If you are smart, the US is the easiest and safest place in the world to become wealthy.

[mawilson 2,133]

The social states in Europe are generally better for the less well educated, but they come with a price of high unemployment, high taxes, and low salaries. If you are smart, the US is the easiest and safest place in the world to become wealthy.

[Trompe le Monde 1,107]

Well, the Republican governers in blue states are far more moderate than the ones in red states. They also tend to have Democrats controlling the State House & Senate seats.

A wise man from Massachusetts is famous for saying "All politics is local." (Tip O'Neill). Republicans in Blue states still have high taxes, and Democrats in Red states tend to have lower taxes. The state legislatures are really the ones controlling this, not the governers.

Probably why the article is pointless unless discussing "blue" versus "red" legislatures (and governorships) and not how they went in the presidential election.

One of the reasons why red-state Nevada (albeit one that sends Harry Reid to the senate) has been so successful in economic growth and low taxes is because of gambling revenues, something most "red states" would have a hard time getting behind.