And Now the Rest of the Story… Romney Jobs Edition

Our friends over at the progressive blog are at it again.  This time in an attack on Mitt Romney’s job creation record in Massachusetts.  Now look, because of RomneyCare, Mitt is near my last choice for President.  I personally like him, but that Keynesian leap was a leap too far for me.  Facts however are facts.  Let’s look at the “facts” as presented by our good friend David Kravitz.

   The Republican contender was the governor of Massachusetts from January 2003 to January 2007. And during that time, according to the U.S. Labor Department, the state ranked 47th in the entire country in jobs growth. Fourth from last.

   The only ones that did worse? Ohio, Michigan and Louisiana. In other words, two rustbelt states and another that lost its biggest city to a hurricane.

   The Massachusetts jobs growth over that period, a pitiful 0.9%, badly lagged other high-skill, high-wage, knowledge economy states like New York (2.7%), California (4.7%) and North Carolina (7.6%).

   The national average: More than 5%.

As Paul Harvey used to say, and now for the rest of the story.  

Economists generally consider a range from 4% – 6.4% structurally full employment.  One would expect that due to a shortage in labor supply at this level that adding jobs would be tough.  Below you’ll see a chart of the unemployment rates of the four states David highlights as having higher rates of job growth than Massachusetts during Governor Romney’s term.  

Note that the states of New York, California, and North Carolina all started the periods with a greater unemployment rate than full employment.  Massachusetts was in the middle of the structural unemployment range, hence in full employment mode, and suffering from a shortage of labor.  

According to the Boston Foundation the 2000s were a labor shortage crisis was happening in Massachusetts.

# Massachusetts’workforce is declining. A 2006 MassINC report, Mass Economy: The Labor Supply and Our Economic Future, found that between 2003 and 2005, Massachusetts “exported” 120,000 workers. In 2004 alone, the out-migration to other states resulted in a net loss of 29,033 people between the ages of 35 and 54, 14,370 children under 16, and 18,000 people with a B.A. or higher. Over the three years, the state’s workforce contracted by 1.7% while the nation’s increased by 3.1%.

# Labor shortages are appearing in every industry sector. An October 2006 Conference Board report showed that Massachusetts, “with 170,100 advertised vacancies, posted 5.05 vacancies for every 100 persons in the state labor force, the highest rate of any state in the nation.”(editorial emphasis)

# Baby Boomer retirements loom. At 1.87 million, Bay State Boomers account for about 40% of residents in 10 municipalities and more than 30% in 263 others. A 2005 MassINC survey warned that 35%, or 650,000, “say that they want to leave the state for their retirement years.” A 2006 survey of local employers by AARP found fewer than 20% of companies preparing for this “stark demographic shift.”

It’s not that we had a hiring problem in Massachusetts during Romney’s term.  It’s that we had a labor shortage.  In Mitt Romney’s last year in office, there were 170,000 unfilled positions.  “Now you know the rest of the story.”

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