Iowa Policy Project
Once again, our friends at Iowa Policy Project come to controversies with those nasty little things called facts. Not sure if they meant for this to happen, but they published two guest opinions in local papers that took a couple of old business pushed chestnuts out for examination and found them wanting.
In one Heather Gibney examines Iowa’s low minimum wage and the arguments for it and argues that they simply don’t hold water. In a paragraph that really hits home Gibney states:
“If you want to make a philosophical case against the minimum wage, go ahead, but it won’t feed families. And, despite the scare tactics about effects on job numbers, good research by the Center for Economic and Policy Research has examined the most rigorous economic research over the last two decades on the impact of minimum wage increases on employment and found no effect.”
A few days later Peter Fisher comes along to do battle with the long pushed concept that Iowa has a bad business climate. This concept has been leveraged by business lobbyists to try to leverage business favored legislation over decades. Here Fisher takes this idea to task and finds it quite wanting:
“So where does this “terrible tax climate” notion come from? The basis for it is a Rube Goldberg contraption built by the Tax Foundation called the State Business Tax Climate Index. It is a mishmash of 118 tax features, selected to emphasize progressivity. These various measures are weighted arbitrarily and combined into a single number for the index.
This number has no real meaning. It produces wacky results because it gives great weight to some minor tax features (such as the number of tax brackets) while leaving out completely two things that have a huge impact on corporate income taxes in Iowa: single sales factor, and federal deductibility.
Only by ignoring the important factors can the authors conclude that Iowa’s corporate income tax ranks 49th. Supposedly only one state has a worse tax. Yet the Iowa corporate tax per capita amounts to only half what it does in the average state, and the tax actually paid by business is among the lowest in the country. The authors’ own charts show that corporations are taxed quite lightly here.”
As always I invite you to keep up on IPP’s well thought out take on issues important to Iowans, especially their pocketbooks. Stop in here a couple times a week to see what is happening
The Iowa Policy Project today (July 18) released the following statement by Executive Director Mike Owen about the latest numbers:
“Stability in Iowa’s job market received a boost in June from public-sector jobs. Despite a 4,300-job increase in government jobs, a mixed performance in other sectors combined for a slight decline, leaving Iowa up 3,100 for the month.
“Iowa’s overall modest growth of 1,800 jobs per month during the past year is about the same pace of the previous 12 months. At this rate it would take about three years or more for Iowa to completely recover for the losses from the recession, according to calculations by the Economic Policy Institute.”
Job Growth Perspective
Governor Branstad set a goal of 200,000 new jobs over five years. Iowa’s economy has produced 73,400 net new jobs through the first 41 months of his term. To add the remaining 126,600 jobs, Iowa would need to add 6,700 new jobs per month over the next 19 months, compared to a pace of 1,800 for the first 41 months.
An approach more relevant to evaluating economic progress is to look at the job numbers in the context of recovery from the last national recession. Iowa is now above pre-recession job levels — but those jobs serve a 4.8 percent larger population, according to the Economic Policy Institute (EPI). The net job gain since the December 2007 start of the recession is 24,700 — but 72,800 were needed by now to keep up with population growth. Therefore, the state shows a job deficit of 48,100 jobs.
Graph reflects Economic Policy Institute Analysis
Hmmmm……. This sounds nothing like the Branstad commercials I have seen. Is he still fabricating his numbers?
Once more, the folks over at Iowa Policy Project take an hot button issue, take the emotion out of it and give us a sober fact based report. I certainly wish some of our politicians would take a cue from IPP in their actions. This month they look at the effect of immigrants in Iowa.
As an aside, in today’s parlance “immigrant’ has seemed to become synonomus with “Latino.” IPP in no way designates a specific group of immigrants in their report. This is some interesting reading for the Fourth of July weekend in a land built on immigration.
Immigrants in Iowa
What New Iowans Contribute to the State Economy
Immigrants are important to Iowa and its economy:
- generating income as workers, spending money as consumers, and contributing to state and federal revenues as taxpayers;
- starting businesses that contribute to local economic development and job creation; and
- contributing to the vitality and culture of Iowa communities.
In fact, immigrants make up about 4.3 percent of the Iowa population, account for 4.5 percent of the state’s economic output and represent 1 in 20 Iowa workers.
These contributions would increase further if immigration reform were to make work authorization or a path to citizenship possible for the subset of Iowa immigrants who currently lack such documents. That subset — undocumented immigrants — pays an estimated $64 million in state and local taxes, and another $37 million in federal payroll taxes.
In a new report for the Iowa Policy Project, researchers Heather Gibney and Peter Fisher explore the facts that should be part of an accurate understanding of Iowa’s immigrant population and its relationship to the state’s economy. Read our new report — or the two-page executive summary here.
Did you know? The Congressional Budget Office estimates that over half of undocumented workers have federal and state income taxes withheld from paychecks, along with payroll taxes for Social Security and Medicare. Yet they are unable to access benefits that they are helping to fund. Learn more in our new paper.
Once again we wish to thank Iowa Policy Project for their solid and in depth analysis on issues in the state of Iowa. We are quite lucky to have such a policy analysis group in a small state such as Iowa. They sent out his teaser in email last week. We recommend taking some time to walk through their analysis:
Looking back at the session
Another year of a tuition freeze and a change in Child Care Assistance to help working parents who go to school part time — both moves from the 2014 legislative session should help working families. But much was left on the table when lawmakers went home.
‘How much?’ is the question
Raise in Iowa’s minimum wage is long overdue
Stability can be overrated. The state’s minimum wage has not been raised since January 1, 2008. That means six years of increases in costs of food, health care, child care, clothes, utility bills, transportation costs from fuel to vehicles to insurance. You name it and if it’s part of a regular household budget, the costs have gone up, whether you’re making six figures or the minimum wage. But the minimum wage has held at $7.25 an hour, well below the cost of living in our state. Read more about this on Iowa Policy Points, with these posts:
On our blog: Making policy matter
As Iowa Policy Project research has described, frac sand mining poses environmental, aesthetic and economic threats to one of Iowa’s most picturesque regions. Local officials in Allamakee County are attempting to respond. Learn more in David Osterberg’s post on Iowa Policy Points, or his radio interview with Michael Devine on KVFD Fort Dodge.
Iowa has a jobs deficit
While there are more people working now than there were before the recession started in December 2007, a full recovery not only would recapture lost jobs but also create enough new jobs to keep up with increased population. And by that measure, Iowa remains about 56,100 short. Read more about the Iowa job picture in our latest Iowa JobWatch report.
Did you know?
The federal Earned Income Tax Credit benefits about 15 percent of Iowa tax filers. In tax year 2012, this contributed over $439 million to the Iowa economy. See what it looks like in your community.
Today we put out the second installment of our Cost of Living in Iowa report, which found 1 in 6 Iowa households do not make what is needed for a basic-needs household budget (3 out of 5 single-parent households).
As co-author Peter Fisher noted in our news release:
“No one discussing issues such as the minimum wage, and eligibility for child-care assistance, can reasonably ignore the economic realities facing these families.”
Find the report here:
The IPP Staff
The Iowa Policy Project has been watching Iowa’s job picture for more than 10 years with a monthly review of the state’s job data as it is released. Along with our annual reports on The State of Working Iowa, this monthly analysis — Iowa JobWatch — has been a frequently quoted feature of IPP work, and has established IPP as a place to turn when media, advocates or policy makers are looking for perspectives about what’s happening in Iowa’s job market.
As we aggressively maintain a nonpartisan approach to our work, the introduction of a blatantly political element to the official job data provided by Iowa Workforce Development has been disappointing. So our Iowa JobWatch reports in recent months have featured the actual count of net job change since Governor Branstad took office in January 2011 — with the caveat that there is a better approach.
The graph below represents the more appropriate alternative to job counting that we have encouraged Iowans, including the Governor, to consider. Provided by the well-respected Economic Policy Institute, this measure looks at net job change dating back to 2000. It shows where jobs dropped in our state during the last recession (red area), and shows how many jobs we are short given the increase in population since the recession began.
The Cedar Rapids Gazette recently reprinted an Iowa Policy Points blog post from IPP’s Mike Owen about why we need to take care with official data, and what we should be able to expect from official state sources on it.
Three other major Iowa newspapers have printed IPP perspectives on various issues in recent weeks. Last Wednesday, we appeared in two different newspapers about two different issues: the minimum wage and Iowa’s unchecked spending on tax credits. Here are links (Note, if any of these links expire on the newspaper websites, our published guest opinions also may be found on the IPP website):
— In The Des Moines Register, Heather Gibney’s “Iowa View” on the minimum wage: “Opportunity wage is a misleading term.”
— In the Quad-City Times, Mike Owen’s piece on the Research Activities Credit:
“Auto-pilot tax credits add millions to Iowa firms.”
In addition, IPP’s Peter Fisher had a guest opinion a week earlier in the Iowa City Press-Citizen about public-sector pension plans: “Strengthen, don’t break, Iowa’s public pension plans.”
Wage theft was the topic for David Osterberg last Thursday in our regular early-Thursday interview on Mike Devine’s “Devine Intervention” radio program (KVFD Fort Dodge) to discuss wage theft. That recording is available here on our website.
Thank you as always for your interest in our work, and for your support. Remember, you can always make a tax-deductible contribution to us securely online — even set up regular monthly or quarterly donations. Our work doesn’t happen without support from people who want to assure good information is produced and circulated in our state.
The IPP Staff
20 E. Market St. • Iowa City, IA 52245
(319) 338-0773 • (319) 331-1287 cell
IPP Friends: How to Count Jobs
Keeping Count of Iowa Jobs — Carefully
Numbers are funny things. Except when they’re not. And when it comes to jobs, they are not something to be treated lightly. That’s why IPP today put out a special Iowa JobWatch — a report that normally goes out only when Iowa Workforce Development releases monthly updates on employment in the state.
Find today’s report here:
The Governor’s Office has been peddling a number above 160,000 for jobs the administration claims have been created on the Governor’s watch. The best explanation for that number that we have found is that … well … there isn’t one.
Meanwhile, we have done the math every month for the last 10 years and it’s quite clear: The Governor’s count is wrong. He is claiming almost triple the number of jobs actually added by the Iowa economy since he took office. In our special report today by Colin Gordon, we note the real number: 56,600.
But more to the point of job-tracking, we step away from the political lens that others focus through, and instead we look at jobs from the standpoint of economic performance. And when you do that, you see we are still are 55,100 jobs short of where we need to be to (1) recoup the number of jobs lost during the Great Recession, a level Iowa reached this summer, and (2) add enough additional jobs to keep up with growth of the Iowa population.
We have made such points in our JobWatch reports, but we thought recent publicity for the faulty numbers merited a “primer” to help everyone as a reality check. When policy choices are being debated, using solid data is essential. Try your own count at home. We are pretty sure you’ll come up with the same number we do.
Starting Each Month Further Behind
For those working low-wage jobs and receiving SNAP benefits, November delivered a new blow. All beneficiaries of the Supplemental Nutrition Assistance Program — 420,000 people in Iowa — began getting fewer benefits as an improvement from the 2009 Recovery Act expired, even though the recovery is not complete. Find our blog post about the change, A new look for the first of the month, which comes as the House and Senate are still negotiating a new Farm Bill that could cut benefits even further — drastically so, if House leaders get their way.
Thank you as always for your interest in our work!
The IPP Staff
I would normally not feature a message from IPP so shortly after doing so with their annual look at working Iowa. However, their treatment of the Republican attempt to make millions of Americans and thousands of Iowans go hungry through major cuts in the food stamp program is important. Hunger in Iowa is not some esoteric idea, it is as close as next door and certainly in every classroom in Iowa. So here is some very important research once more done by our friends at Iowa Policy Project:
So, in the same week we receive fresh evidence that recovery from hard times has not come quickly in the years following the Great Recession, the
U.S. House is considering severe cuts to nutrition assistance through the SNAP program. It’s probably a good idea to look at these related matters in the context that connects them, rather than leaving the “dots” isolated and missing the public policy ramifications.
That’s why we’re here.
This is the time of year when we learn a lot about the state of the economy in Iowa and get a fresh look at trends. Here’s a reminder of what we’ve put out in recent weeks and a heads-up to what’s coming.
The State of Working Iowa 2013
Our annual look by IPP Senior Research Consultant Colin Gordon examines real issues that face Iowa’s working families — data about jobs and wage trends, framed by sensible messages about the consequences for Iowans and policy options. If you missed it Labor Day weekend, you can still find it in two forms:
— a print version of the report (18-page PDF file) plus our news release on the IPP website, www.iowapolicyproject.org, and
— an interactive version of the report on our special State of Working Iowa website — www.stateofworkingiowa.org. There, you can click on interactive versions of many of the graphics and sort the data the way you want.
Food Insecurity in Iowa
As Farm Bill idles, food needs challenge 13 percent of Iowa households
While Congress fails to resolve a stalemate on food assistance and the Farm Bill, long-term trends show hunger rising in Iowa.
In addition, see our blog:
Why, again, would it make sense to cut SNAP?
Food insecurity has grown in Iowa, we have not recovered from the Great Recession, and SNAP benefits — which only augment household food budgets, support work and are already scheduled for cuts this fall — may be slashed.
Health Insurance Trends
At doorstep to ACA implementation, Iowa sees decade drop in coverage
As the nation prepares for the 2014 implementation of the Affordable Care Act, a steep recession and compensation trends have left 1 in 9 working-age Iowans and children without insurance, according to one the major surveys by the Census Bureau.
Income and Poverty Trends, plus more on Health Insurance
Coming Thursday: New data from Census
Be watching the IPP website — www.iowapolicyproject.org — or our Facebook or Twitter feeds for new information about what’s been happening in Iowa on income, poverty and health insurance. The Census Bureau will be making its annual release from the American Community Survey on Thursday. Stay tuned!
Thank you as always for your interest and your support of our work.
Once again our friends at the Iowa Policy Project have released their annual report on working families in Iowa. This is one of their chief research projects every year. While we hear folks like Governor Branstad extol the economy under his watch, the Iowa Policy Project dig under the BS and ferret out the truth. The truth they find is usually in contrast to the rosy picture that the politicians paint. If you plan on talking to your legislator this year, I strongly recommend reading and digesting the report put out by IPP. Remember that facts are stubborn things and in order to find solutions we must understand the problem.
Here is an excerpt from the email from Mike Owen concerning the release of the report:
It’s that time of year again! Labor Day weekend, and you know what that means: attention to the real issues that face Iowa’s working families. And you have plenty of information to discuss over brats and burgers this weekend with The State of Working Iowa 2013, the latest edition in our signature series from the Iowa Policy Project.
IPP Senior Research Consultant Colin Gordon once again has put together a strong package of information — data about jobs and wage trends in our state and the nation, framed by sensible messages about the consequences for Iowans.
You can find the report in two places: a print version of the report (18-page PDF file) and our news release at our website, www.iowapolicyproject.org, as usual, and also an interactive version of the report our special State of Working Iowa website — www.stateofworkingiowa.org. At the State of Working Iowa website, you’ll also be able to click on interactive versions of many of the graphics in the report, permitting you to sort data yourself as you like.”
From Colin Gordon’s summary:
Among Gordon’s key findings:
• Almost seven years since the onset of the Great Recession in December 2007, the national economy is far short of pre-recession job levels. For Iowa, the picture is a little better, with the state finally reaching the pre-recession level in June.
• When accounting for population growth, Iowa remains about 52,000 behind the pre-recession mark and at its recent pace could clear the jobs deficit two years from now.
• Long-term unemployment has been stubborn — 33.5 percent in 2010 (over a third of Iowa’s unemployed were jobless for more than six months). That figure had fallen only slightly, to 27.5 percent, by the end of 2012.
• Recovery has eased some of the steep job losses from recession in Iowa, but Iowa still shows a net decline in two traditionally high-quality job sectors, construction and manufacturing.
• Wages not only have stagnated while workers have become more productive.
• The education premium — a return on the investment of higher education — has been uneven and uncertain. While a smaller share of the Iowa labor force would be deemed “low-wage” workers than 30 years earlier, a larger share has at least some college education yet falls within that “low-wage” category.
“In the nation and in Iowa, we see a long trend toward lower-wage service employment,” Gordon said. “Sustained losses in key middle-income sectors — such as manufacturing and public service — have not been accompanied by real opportunities elsewhere in the economy.”
Reading IPP is very basic to being an informed citizen in Iowa. They send out email updates usually around once a month. The subject are always timely, thoroughly researched and pull no punches. You can get on their email list by doing this:
Want email updates from the Iowa Policy Project?
Send an email to: ipp (at) Lcom.net. Put “sign up” as your subject and include your name, organization and any other information you would like us to know. We will send you emails once or twice a month, or as needed to announce the release of a new report.
In adding my congratulations to Mike Owen for his promotion as executive director of the Iowa Policy Project, I also suggest readers check out his latest blog post titled, “We promise: We won’t cook burgers.” It is about the spurious advice of Visa® and McDonald’s®, that their lowly paid workers should become financially sustainable by working a second job. Iowa Policy Project is one of the few Iowa think tanks that has done substantial work studying living wage, low wages, and minimum wage. It is a subject close to my interests, and Mike and his team’s work at Iowa Policy Project have informed some of my thinking on low wage workers. It will be good to have Mike as executive director.
With regard to the Visa® and McDonald’s® suggestion of securing a second job, it seems a bit reactionary to me. Another low wage worker employer, Walmart, has been consistently hammered by progressive writers (see Thomas Stackpole at Mother Jones) for advising their employees on how to leverage the governmental social safety network of energy assistance, SNAP, Medicaid and other programs. The second job suggestion is an alternate version of the Walmart story: we won’t pay a living wage, so employees are on their own to sustain financial viability.
There is more to working a low wage job than pay. There has to be because the cost of living, including health care, transportation, food, shelter, and interest on debt, is more than low wage jobs pay, even two of them. Little would change if the minimum wage were raised to over $10 per hour as some propose. Low wage jobs fall short of a living wage, so people have to adapt, and one of the ways they do is to take advantage of governmental assistance programs. Beside government programs and working additional jobs, what else is there?
Another payday for low paying work is building a social network to help meet basic economic needs— one based in direct human contact, unfiltered by electronic media. A host of services are available because of work relationships in a low wage job. A tattoo artist offers his ink at a discount, people of means offer loans, and gardeners offers to exchange vegetables and baked goods. There is ride-sharing, child care and a network of discovery of ways to escape low paying work for something better. Human society in low wage work places is like a living coral reef, where everyone’s needs can be met at a certain level. These things have little to do with the progressive argument about wages, but they are every bit as important.
The tone deaf suggestions of Visa® and McDonald’s® demonstrate a lack of understanding of how people operate. Namely, if the company articulates the deceit, people may start believing it, maybe they will stay with the company a bit longer, and the cost of employee turnover can be reduced. A cynical view? Not really.
Working two jobs may be a necessity for many, but if we are on our own, as corporations want us to be, life becomes less about the job and more about who we know that can help us when we need a hand. Thanks for the suggestions and financial planning tools corporations, but no thanks, we can get by with a little help from our friends.