Laura Tomaka

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CSG Midwest
In May, trends in U.S. unemployment appeared to take a positive turn, one unexpected by many economists. And as the Midwest’s legislators learned on a webinar that same month, changes in this closely watched economic indicator have huge impacts on states’ bottom lines.
“When the national unemployment rate goes up by one percentage point, there are budget shortfalls across all states of about $45 billion,” Michael Horrigan, president of the W.E. Upjohn Institute for Employment Research, said during the webinar hosted by the Midwestern Legislative Conference Economic Development Committee.
“The other estimate that we’ve come up with is that if a state unemployment rate goes up by one percentage point, states lose about 7 percent in tax revenue.”
Though the May numbers were promising — the result of factors such as the end of stay-at-home orders, business reopenings and an influx of federal dollars that, in part, encouraged businesses to retain workers — unemployment rates remain historically high.
CSG Midwest
Since early April, Rep. Dave Greenspan and 23 other members of a specially formed Ohio House task force have been meeting, sharing ideas, and getting the perspective of business owners across various sectors and geographic areas.
One question above all else is guiding his work on the task force: What can we do to help businesses reopen, and remain open, safely?
“We’re not looking at the same things that the governor is looking at as far as public health protocols,” Greenspan says. “Our attention is on what we can do either directly through legislation or by facilitating, through other bodies, actions that allow [businesses] to open.”
That Economic Recovery Task Force in Ohio is an example of the important work being done by the Midwest’s legislatures, even during a time when the powers of governors have been strengthened due to the public health emergencies caused by the COVID-19 pandemic.
CSG Midwest
As of early March, Wisconsin was set to become one of the first states in the nation to expand incentives for private investments in federally designated Opportunity Zones. Under AB 532, which passed with bipartisan support in the Assembly and Senate, Wisconsin would double the tax credits for investors supporting projects in financially strapped, low-income communities across the state. (The bill had not yet been signed by the governor as of early March.)
CSG Midwest
In Iowa, Gov. Kim Reynolds has made improving economic opportunities to all areas of the state a top priority. To do this, she has placed a particular focus on rural Iowa and the challenges faced by those communities.
Since 2018, state and community leaders have taken part in the governor’s Empower Rural Iowa Initiative in order to address the challenges facing the state’s rural communities. The initiative’s work resulted in legislation and a set of recommendations for continued action.
Sixty percent of Iowans live in counties with populations less than 100,000 and 30 percent live in counties with less than 25,000, making rural Iowa critical to the entire state, says Iowa Sen. Mark Lofgren.
CSG Midwest
Marysville, Ohio, is home to the first Honda manufacturing plant in America. It opened in 1979 with 64 workers assembling the company’s Motocross motorcycle. Auto production soon followed. Now in its 40th year of production, the original plant, along with several nearby operations, employs 13,000 workers in the northwest part of the state.
Ohio Rep. Jon Cross, whose district lies just north of the Marysville plant, has visited the facility and seen the work being done there. “It’s highly technical, highly skilled,” he notes, more of what one might expect at a tech company rather than a car manufacturer.
More and more, that is the reality of work in manufacturing and other sectors of the Midwest’s economy — the result of advances in technology, automation and robotics. For states, that means economic growth depends in part on having a highly skilled, adaptable workforce able to keep up with the fast pace of change.
According to the U.S. Bureau of Labor Statistics, as of June, there were 1.5 million job openings in the Midwest (see map for state-by-state data), and many businesses say they can’t find enough people with the necessary skills to fill the vacancies that they have.
Parts of this region, too, have among the lowest unemployment rates in the nation; Ohio’s is actually a bit over the national average, but it’s still only 4.2 percent.
“That basically means we’re at full employment, and that’s really great for the economy,” Cross says. “But the downside is that businesses are [struggling] to grow and find new employees.
“Where are these new employees going to come from?”
The answer to that question, in Ohio and other states, is more complicated than simply relying on new high school or college graduates. “Colleges are not pumping out enough people to fill the new positions that are going to be available in our workforce in the next three to five years,” Wisconsin Sen. Dan Feyen says about the labor market challenges in his state.
“So we need to make sure that we can take people within our existing workforce and put them in jobs where they can excel.”
CSG Midwest
Marysville, Ohio, is home to the first Honda manufacturing plant in America. It opened in 1979 with 64 workers assembling the company’s Motocross motorcycle. Auto production soon followed. Now in its 40th year of production, the original plant, along with several nearby operations, employs 13,000 workers in the northwest part of the state.
Ohio Rep. Jon Cross, whose district lies just north of the Marysville plant, has visited the facility and seen the work being done there. “It’s highly technical, highly skilled,” he notes, more of what one might expect at a tech company rather than a car manufacturer.
More and more, that is the reality of work in manufacturing and other sectors of the Midwest’s economy — the result of advances in technology, automation and robotics. For states, that means economic growth depends in part on having a highly skilled, adaptable workforce able to keep up with the fast pace of change.
According to the U.S. Bureau of Labor Statistics, as of June, there were 1.5 million job openings in the Midwest (see map for state-by-state data), and many businesses say they can’t find enough people with the necessary skills to fill the vacancies that they have.
Parts of this region, too, have among the lowest unemployment rates in the nation; Ohio’s is actually a bit over the national average, but it’s still only 4.2 percent.
“That basically means we’re at full employment, and that’s really great for the economy,” Cross says. “But the downside is that businesses are [struggling] to grow and find new employees.
“Where are these new employees going to come from?”
The answer to that question, in Ohio and other states, is more complicated than simply relying on new high school or college graduates. “Colleges are not pumping out enough people to fill the new positions that are going to be available in our workforce in the next three to five years,” Wisconsin Sen. Dan Feyen says about the labor market challenges in his state.
“So we need to make sure that we can take people within our existing workforce and put them in jobs where they can excel.”
CSG Midwest
With nearly 700,000 workers employed in more than 12,000 firms, Ohio has the third-highest number of manufacturing jobs in the nation. That number, state Rep. Mark Romanchuk says, could be even higher. “Many good-paying manufacturing jobs are going unfilled,” he notes.
Ohio is not alone.
According to the National Association of Manufacturers, 2.4 million manufacturing jobs will go unfilled across the nation over the next decade. Among the factors: low unemployment, a shortage of qualified workers, and retirement rates that are outpacing the entry of younger workers into this sector. In addition, despite competitive pay and good benefits, manufacturing jobs are often viewed as being low-skilled and undesirable, carrying the image of dirty factories filled with assembly lines and repetitive work.
Ohio policymakers are hoping to dispel these misconceptions by giving more young people early exposure to real-world, on-the-job experiences. Included as part of this year’s biennial budget bill, HB 166, the Manufacturing Mentorship Program will allow 16- and 17-year-old students to work part-time in manufacturing jobs. Previously, any minor working in a manufacturing facility had to be enrolled in a career technical education program.
CSG Midwest
In Kansas City’s metropolitan area, there is a long history of businesses crossing the Kansas-Missouri border — lured by one of the two states’ tax breaks and financial incentives. “It’s a zero-sum game when incentives are given to move a company just a few miles from where it was,” says Rep. Kristey Williams, a member of the Kansas House Commerce, Labor and Economic Development Committee. “Essentially, taxpayers lose.”
Could this traditional type of interstate competition be replaced by an interstate collaboration, or cease-fire?
Smaller- and large-scale ideas were being proposed in the nation’s state legislatures in early 2019, including a bill known as the “border war bill” in Missouri. Passed by the state Senate in late February, SB 182 would prohibit state incentives from being offered to companies located in four Kansas border counties. Kansas would have to adopt a comparable ban for SB 182 to take effect.
According to Missouri Sen. Mike Cierpot, the bill’s sponsor, the two states have “spent over $335 million shuffling businesses back and forth over state lines … by moving a matter of miles, or in some cases blocks.”
CSG Midwest
In North Dakota, two features of the state’s economy have persisted for years now: some of the lowest jobless rates in the nation, and workforce shortages challenging individual employers and entire economic sectors. 
“By most estimates, we have over 20,000 unfilled jobs,” notes North Dakota Sen. Brad Bekkedahl.
Would scholarships or a loan-forgiveness program — with some strings attached — help fix this mismatch between worker supply and demand? And which of these two options would work best? Those questions were explored during the legislative interim and will likely emerge again when lawmakers convene in early 2019.
CSG Midwest
Ohio lawmakers are hopeful that new blockchain legislation will make the state a leader in developing the emerging technology and attracting businesses that would use it.

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