For Gov. John Kasich, author of Ohio’s “Jobs Budget,” the state’s unemployment needle would seem to be heading in the wrong direction.
Ohio’s unemployment rate remained unchanged in September at 9.1 percent, and there were actually 21,600 fewer jobs in the state than there were in August, according to the Department of Job and Family Services.
But as Kasich travels the state highlighting his accomplishments in the eight months through August, he tells a different story about Ohio’s jobs picture. Whether he’s stumping for Issue 2 on a farm in Logan County, or chatting up private insurance salesmen in Columbus, the first-term Republican governor delivers the same spiel:
Since he took office in January, Kasich’s Department of Development (the same department he is scaling back and replacing, in part, with the private JobsOhio) has been involved in 154 projects in which it has extended tax credits or loans in return for cementing commitments for 10,430 new jobs and the retention of 20,460 jobs, for a combined payroll of $1.7 billion.
The Kasich administration supplied The Dispatch with a spreadsheet detailing each project.
“This is good stuff,” Kasich said during a recent speech in Rio Grande, Ohio. “It’s a sign of progress, and we’re working on a whole list of additional projects that can bring success to the state of Ohio.”
So which is it? Is Ohio’s economy still spinning its wheels, or is it on an uptick with Kasich in charge? And how can separate sets of numbers that appear to paint different pictures of the state’s economy both be right?
Ben Johnson, a spokesman for the Department of Job and Family Services, says the state takes two surveys each month. One, conducted by the U.S. Census Bureau, is a survey of households in which respondents are asked how many people there are currently working, and if some aren’t, how many of them are looking for work.
Johnson said the census survey is the primary source the state uses to determine unemployment. The state also conducts a payroll survey to determine job numbers, and that survey shows that Ohio has added more than 66,000 jobs over the past year and 28,800 since Jan. 1, including 22,000 in June and July.
Some – but certainly not all – of the 10,000 new jobs that Kasich says his Development Department helped to create are included in that 28,800 number. Companies that commit to creating new jobs get years to do so, and the tax credits they receive in return are based on performance.
“Those surveys can move in different directions, and it’s especially common for them to diverge when the overall shift is small,” Johnson said. “Twenty-eight thousand new jobs shows the state is moving in the right direction, but it’s a small number when compared with a work force of 5million.”
Kasich, and Republicans in general, were trumpeting last month that August’s survey showed that more than 48,000 jobs had been created since Jan. 1 (Kasich took office Jan. 10), but that number dropped by more than 21,000 in September.
Democrats, who among other things are still frosty from Kasich’s hammering of former Gov. Ted Strickland last election cycle over the tens of thousands of Ohio jobs lost during a national recession, are firing back at the GOP governor over his jobs performance.
Earlier this month, Democrats and organized labor held protests outside Kasich’s regional offices over what they said were Kasich policies that were hurting – not helping – job creation, including his support of limits on collective bargaining for public employees.
The flat unemployment rate for September comes after three months of a rising unemployment rate in Ohio.
“Since he’s been in office, the rate has either gone in the opposite direction or no direction at all,” said Chris Redfern, chairman of the Ohio Democratic Party.
Ned Hill, a professor of economics at Cleveland State University, said unemployment rates typically rise in the early stages of an economic recovery because more people are looking for work, and “no sane economist looks at the unemployment rate” to gauge a state’s economic performance.
Hill said he relies on job-creation and -retention statistics, and he credits the Kasich administration for successfully persuading companies such as American Greetings to remain in Ohio.
Kasich’s critics question whether some corporations, such as Bob Evans and Diebold, that have received financial incentives from the governor really would have left without the breaks.
“If we all paid attention to political rhetoric on both sides, we’d all be schizophrenics,” Hill said. “I was a little skeptical of American Greetings at first, but with the research I’ve done, it’s clear to me they were genuinely willing to move from Ohio.”
As was common practice for the previous administration, the Kasich administration counts all jobs at a company’s current facility as “jobs retained” when that company receives a state-sponsored financial package – even if that package was intended for company expansion.
For instance, Momentive Performance Materials, which is based in Columbus, was approved for a 60percent, six-year tax credit in return for its promise to create 100 jobs generating $10 million in payroll. The Kasich administration counts those 100 new jobs toward its 10,430 new-job commitments, but it also counts the 298 people who currently work at Momentive’s Columbus and Gahanna locations.
Pete Loscocco, a vice president with Momentive, said it’s fair for Kasich to count the company’s current positions as jobs retained.
“From John Kasich’s standpoint, we did have options and continue to have options,” said Loscocco, whose company is actually a creation of a merger that took place last year. Momentive has operations in Albany, N.Y., among other places, and Loscocco said the company could’ve decided to relocate some jobs that are in Ohio.
“Incentives aren’t the only thing, but it’s definitely a factor you look at,” Loscocco said. “I’m a big advocate for the city of Columbus, and I personally didn’t want to make the move to Albany or any other city, but (incentives) are things you have to consider.”
Christiane Schmenk, Kasich’s development director, said the state does turn away some companies when they ask for financial help. Her department also is trying to recoup state funds from companies that failed to meet performance standards.
Of the nearly $1.7 million in state grants the Development Department has identified to recoup from companies that did not create the jobs they promised, the state already has clawed back $278,070.
“There’s just a disconnect,” said Redfern, the Democratic party chief, of Kasich’s overall jobs agenda. “He trumpets successes like convincing Bob Evans not to depart, when the company wasn’t going to leave anyway. And he stands by idly as tens of thousands of public employees lose their jobs because of his budget cuts.”
James W. Brock, an economics professor at Miami University in Oxford, compared criticizing Kasich for his incentives program to criticizing President Barack Obama for the $787 billion stimulus package he signed in 2009.
“What might’ve happened had Gov. Kasich done nothing?” Brock said. “If he would’ve done nothing, we’d likely have even fewer jobs than we have now. It’s the same point that gets lost in the national debate over the Obama stimulus plan. If Kasich hadn’t acted, we might have 10,000 fewer jobs coming to Ohio.”