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Ellen Belcher is the Dayton Daily News opinion pages editor. She writes about state government, education, the environment, higher education and all things Dayton.
Martin Gottlieb is an editorial writer and columnist for the Dayton Daily News opinion pages. He focuses on the political process itself and does such national issues as war, the economy, taxes and Social Security, as well as a hodge-podge of local and state issues.Home > Blogs > A Matter of Opinion > Archives > 2009 > December > 05 > Entry
Editorial: Shrinking income compounds jobs problem in Ohio
During the last six months, the number of jobs in Ohio has held pretty steady at about 5.1 million. The unemployment rate has ranged from 10.1 to 11.2 percent, because it’s a weird statistic.
The real numbers to look at when trying to get a feel for whether employment is really picking up — the big question of the day about the economy — are those relating to numbers of jobs.
By that score, Ohio isn’t doing all that badly — at least relatively speaking. Nationally, the total number of jobs continues to decline, although the drop in November was only 11,000, which is essentially flat.
According to a government report, from September to Oct. 21, states lost jobs. New York led with 15,300 lost. Florida lost 8,500. Georgia might be gaining NCR, but it lost 7,500 jobs net.
Ohio gained 1,400. That’s not to be taken as a sign of a turnaround; another marginal gain in recent months was wiped out by a subsequent drop. Still, it’s better than constantly dropping.
The report that had those figures has now been revived to show fewer lost jobs nationally, but it is still useful for comparing the states.
Meanwhile, there is other economic news on the positive side. The stock market is up. Big banks are paying back their government loans. Cars are selling. Home sales have been up sometimes.
One even hears of people actually landing jobs occasionally. And, yes, some people are buying Christmas presents.
Most important, the fear of last winter that the economy was crumbling into a full-fledged depression is gone.
Still, there’s a fear that good times aren’t coming back, not soon, anyway.
Everybody keeps saying that the last thing to improve as the economy grows will be the job situation. Actually, the last thing may be the salary situation.
Things have been so bad on the job front that little attention has been paid to how much people are being paid if they are fortunate enough to have a job.
Just before the financial collapse in the fall of 2008, median household incomes in Ohio had dropped by about $5,000 (9 percent) in this decade (according to a Cleveland Plain Dealer analysis of U.S. Census data).
The median was down even in states that didn’t used to have a lot of big auto factories. But it was particularly down in Ohio.
Wages generally fell in real value in Ohio in the 1980s, then rose through the 1990s. By the beginning of this recession, they were back down to where they were in the mid-1990s.
They must still be going down, given furloughs, salary cuts, hour cuts and staff cuts. The very fact that more people are unemployed tends to push salaries and wages down, because it’s an employer’s market.
The recession has also brought some prices down, which has helped consumers. But when prices turn back up, it’s a good bet that wages will be slower to do so.
President Barack Obama called a jobs summit for this week (and Newt Gingrich held his own in Cincinnati). The political leaders are saying that jobs are the big issue in the economy. They want to make sure that nobody sees them as too excited just because the stock market is up. And, yes, they make a good point.
But the truth is that a focus on jobs alone understates the problem.
Permalink | Comments (5) | Post your comment | Categories: Economy, Editorials, Martin Gottlieb
Comments
By Quentin
December 5, 2009 3:59 PM | Link to this
How exactly am I supposed to give anyone a raise when the state keeps increasing my taxes and new requirements that increase my costs? Maybe if they stopped trying to hammer businesses for more and more then we could pay better and not go out of business. Otherwise it is looking like other states may be the way to go at this rate.
By emperorlotku
December 5, 2009 5:54 PM | Link to this
Impressive. An opinion piece in the Dayton Daily News that is politically neutral and doesn’t pander to the liberal viewpoint. Keep up the good work.
By bobby
December 5, 2009 8:06 PM | Link to this
An interesting statistic that partially explains declines in wages in the privte sector in Ohio. Ohio leads U.S.states that have logged the biggest declines in corporate income tax revenue. The decline is -111% and leads the nation..[source Business Week-Dec.2 2009]… The federal stimulus has done little for the private sector, but has posponed the inevitable job cutting the state must perform.
By joe_mamma
December 7, 2009 9:29 AM | Link to this
Another impediment to hiring is the uncertainty of the future cost landscape. Companies will be more hesitant to hire workers until the legislation working its way through Washington is completed. It also should be noted that income figures are just as screwy as the unemployment figures. First, comparisons to the 90’s offers an artificially high data point. That was during the internet bubble where the unemployment rate among white males was below 3%. Second, Income figures like those cited do not include fringe benefits. Unfortunately more and more of our income is tied to funding employer based healthcare. Those dollars are not captured in median income figures. Thirdly, immigration greatly affects income stats. As low skilled immigrants flood a market they greatly out number the high skill, high wage workers. Even if the high skill high wage earners continue to receive income increases the median income can be dragged down by an increase in low skill low wage immigrants.
By Ggg
December 10, 2009 12:32 PM | Link to this
Only 1% of my costs are for Medical insurance for my employees. The State taxes are 6-9%, Federal 39%. I think these taxes should be cut 25%. Business would prosper and hire more employees. Higher taxes on fewer employees and businesses does not seem to be working for both the State and Fed Government.