Half a year into Gov. Terry Branstad‘s fifth term in Terrace Hill, Democratic skepticism continues to mount over Branstad’s much repeated goal of creating 200,000 new jobs in the state over the next four-and-a-half years, especially as the doors begin to close at Iowa Workforce Development field offices at the end of this month.
Last week, the group launched a radio ad criticizing the governor and the state legislature. In an email to members obtained by The Iowa Independent, ITR called the tax increase on casinos “fundamentally unfair” and claimed it would destroy jobs in Iowa.
The new law singles out Iowa casinos, and would raise taxes on them by 64 percent. At the same time, Republicans have been pushing for a Tax Relief Fund, without significant detail as to how it would be administered, and cuts to property taxes and income taxes.
“This tax grab by state government will take almost $200 million from local communities and transfer that money to state bureaucrats in Des Moines,” Iowans for Tax Relief said in the email.
Leaders from the legislature said in February they doubted the casino tax increase would go through.
Economist Harvey Siegelman of the Strategic Economics Group, hired by gambling interests, concluded if the tax increase went through, four to six of the state’s casinos would close, leading to as many as 4,500 layoffs.
Branstad has said he believed the casinos were crying wolf and didn’t believe it would turn out as bad as they predict. At one point, he said they were the ones who could afford a tax increase.
The Governor confronted protests at town hall events over the issue, but did say he was willing to compromise.
Polling shows around half of Iowans are supportive of the major tax hike.
Hear the radio ad by ITR here.
The Charlotte Observer, struggling with weak advertising revenue, has announced it will cut 20 jobs from its staff, including five newsroom positions.
Charlotte Observer Publisher Ann Caulkins told staffers at a meeting Monday that the company “was living quarter to quarter with our budgets.”
The Observer’s announcement follows similar cuts announced two weeks ago at its sister paper, The News & Observer of Raleigh. The newspapers, the first – and second-largest, respectively, in North Carolina are owned by McClatchy Newspapers of Sacramento, Calif.
In addition to the economic and industry troubles that have hurt all U.S. dailies, McClatchy is saddled with paying off debt resulting from its $4.5 billion purchase of the Knight Ridder newspaper chain in 2006 on the eve of the last recession.
Both the Charlotte Observer, formerly a Knight Ridder newspaper, and The N&O have combined resources and staff in recent years to save on costs. But continuing declines in print circulation and advertising revenue have forced both to shrink their staffs through attrition, buyouts and layoffs.
According to the website Paper Cuts, the newspaper industry has laid off about 17,000 workers since 2008.
Today, the Labor Department reported that the unemployment rate tracked up in 26 states and the District of Columbia between July and August. Maryland and Florida saw statistically significant increases of 0.2 percent, with slight changes in 25 other states.
For the fourth month in a row, Nevada remained the state with the worst unemployment rate — 14.4 percent, the highest level since the government started keeping state unemployment records. North Carolina created the most jobs, 18,600, and Michigan lost the most, 50,300. Over the course of the past year, Alabama, Tennessee, and North Carolina have seen the best improvements in their unemployment rates, which dropped between 1.2 and 1.4 percentage points.
In short: more evidence of a slow recovery.
One interesting detail in this morning’s jobs report: The number of workers out of a job for more than six months declined by about 600,000. Moreover, the long-term unemployed made a smaller percentage of the total pool of unemployed workers. The Wall Street Journal reports that this is perhaps a good sign:
There was a slice of good news in today’s jobs report about the state of long-term unemployment in America. The Labor Department reported that the share of workers who were out of a job for six months or longer fell for the third straight month ….
There are many reasons to worry about long-term unemployment. One is the human toll it takes on individuals and families. Another is a problem that economists call hysteresis, which has plagued Europe. This is the theory that the longer a person is out of work, the harder it becomes to get a new job because that person’s skills degrade. Barack Obama’s top economic adviser, Lawrence Summers, was a leading researcher in this area in the 1980s.
Long-term unemployment still has a long way to go before it gets back to normal. Moreover, it’s not clear why long-term unemployment ticked down.
But I am not sure that this is a good thing. The question — and it is impossible to tell from the data — is how many of these workers found new positions and how many simply stopped looking. I fear the number declined more due to the latter than the former.Why? For one, the impact of the lapse of unemployment insurance benefits. (Workers receiving UI need to be looking for a job. For the weeks that hundreds of thousands of workers had their benefits lapse, there was no such requirement. Could that, plus the financial hardship of losing benefits, have pushed workers out of the labor force?) Additionally, the number of workers who want a job but aren’t currently looking for one increased in August — not enough to explain the entire drop, but enough to explain part of it. Moreover, the labor market just hasn’t improved much, and the longer the spell of unemployment, the harder it is to get a job.
The Wall Street Journal takes a look at a new Bureau of Labor Statistics analysis of what kind of businesses are gaining and shedding jobs. As is often true, small businesses are both the biggest creators of new jobs and the biggest destroyers of existing positions. Small businesses are managing to create some new jobs right now, but poor demand, constrained access to credit and many other issues mean they are lagging in recovery in comparison with large businesses — currently enjoying record-high profits.
Businesses with fewer than 50 employees accounted for 61.8 percent of all job cuts in the private sector in the fourth quarter, the Labor Department reported Wednesday, while the same sized businesses created 54.1 percent of new jobs. Companies of this size employ roughly 29 percent of all workers. The numbers are a reverse from the same time a year ago, when small businesses made up a larger share of jobs that were added as opposed to lost. Small firms made up half of all jobs lost at the end of 2008 but also comprised 53.9 percent of all job gains. …
Taken together, firms of all sizes cut a net of 200,000 jobs in the fourth quarter—as they added 6.6 million jobs, while shedding 6.8 million. That represents progress from a year earlier period, when firms shed a net 1.8 million jobs. Companies with 50 to 249 workers made 17.8 percent of all job cuts in the fourth quarter, and nearly the same percent of job gains, while mid-size companies with 250 to 999 employees added 9.9 percent of new jobs and accounted for 10 percent of job losses.
For a lot of small businesses, the ability to avoid layoffs and to expand depends on access to credit. For that reason, President Barack Obama is urging the Senate to take up a stalled small business bill when they return from recess on Sept. 14.
(Photo: FreeFoto.com/Ian Britton)