Viewpoint: State making strides in jobs recovery

Talk about it

In September, I joined other members of the newly formed bipartisan House Jobs Task Force to convene the first of three daylong hearings this fall to discuss various strategies for putting Minnesotans back to work and bringing our state back to prosperity.

Throughout the day we heard testimony from state officials and economists about what lawmakers can do to help the state’s job market recover in the worst recession since World War II.

I want to take this opportunity to share some of the key ideas and insights that were presented to the task force to initiate an important dialogue about what the state government could do, and should not do, to stimulate job creation and retain jobs in Minnesota. Their testimony will help us create short- and long-term strategies for the next legislative session.

State Economist Tom Stinson encouraged lawmakers to pass a bonding bill early in the 2010 Legislative Session and quickly distribute the bonding dollars to get people working on capital projects statewide.

Stinson advised us not to repeat a past pattern where only 15 percent of capital budgets are typically spent within a year of being authorized by the State Legislature. He encouraged the selection of projects that could be implemented, and thus start associated hiring, more rapidly.

Art Rolnick, senior vice president and director of research for the Federal Reserve Bank of Minneapolis, agreed with Stinson that other than shovel-ready bonding projects there is little the state can do in the short term to spur job growth and accelerate recovery.

Rolnick also advised against the use of industry-specific tax credits and attempting to choose winners and losers. He recommended that lawmakers focus on broad-based policies that research shows to have a high rate of return on public investment. He indicated that the state should focus on the long term and invest in our education system with a strong emphasis on early childhood education and programs geared to retraining laid-off workers.

An update on the state of the economy was given along with testimony on economic development, capital investments and tax policies to create job growth for Minnesotans. There was overall agreement that although we are emerging from a deep recession, we can expect a very slow recovery where unemployment will remain high into the near future.

According to Steve Hine, research director at the state Department of Employment and Economic Development, Minnesota’s unemployment rate is not expected to return to its pre-recession levels until 2012 and at the end of 2012 we will still have 200,000 unemployed people to re-employ.

State Demographer Tom Gillaspy testified on how Minnesota’s aging labor force will constrain our economic growth unless productivity increases more rapidly. He stated that replacement openings will be greater than new job growth for many occupations and explained that part of the reason we are experiencing a slow recovery is that our business capacity is still quite low.

Admittedly the road to economic recovery will be long but I’m encouraged to see the gap widening between Minnesota’s and the nation’s unemployment rate. In August Minnesota’s unemployment rate fell by 0.1 percent to 8 percent whereas the U.S. unemployment rate climbed 0.3 percent to 9.7 percent.

The House Jobs Task Force has been charged by Speaker of the House Margaret Anderson Kelliher to make job creation our top priority. This is a timely opportunity for a bipartisan group of House members to come together to develop job-growth strategies that will contribute to a real economic recovery plan for lawmakers to consider in the 2010 Legislative Session - a bonding year.

The House Jobs Task Force will meet again on October 27, 2009 in Milaca. I want to invite business people in my community to share their interests and testify at one of the next two House Jobs Task Force hearings. Please contact me to share your story and concerns with me, or if you are interested in testifying at one of the hearings. I want to hear as much as I can from our small business owners, our employers, and our local economic development experts as we continue to work on short-and long-term strategies for the next legislative session.

Rep. Julie Bunn, DFL-Lake Elmo, is a Lake Elmo resident. She represents 56A, which includes a portion of Woodbury.

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