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Thursday, Aug. 31, 2017 12:19 am

Behind Rauner’s brags on the economy

PHOTO BY ALAN SOLOMON/TNS
After years of harshly bad-mouthing the state’s economy, Gov. Bruce Rauner has pivoted in the past couple of weeks as the campaign season has heated up.

“I’m proud since I became governor,” he said recently, “we have recruited and added around 120,000 new jobs to the state of Illinois.”

“But,” Rauner said, “we should be growing at four or five times that rate. But we have red tape and restrictions, regulations on our businesses. I have advocated change that, so far, Speaker Madigan has resisted.”

The governor has repeated the 120,000 new jobs figure at least a couple of times since then and has tossed in the reference to House Speaker Michael Madigan as well.

And, indeed, using nonfarm jobs data from the Illinois Department of Employment Security, more than 120,000 net jobs have been added in Illinois since February of 2015, the first full month of Rauner’s term in office.

But most of those jobs were gained in 2015, when 83,400 jobs were added. In the 19 months starting in January of 2016 through July of 2017, just 41,900 jobs were created in Illinois, according to IDES data. Of those, a mere 19,600 jobs were added in Illinois during the first seven months of this year.

The situation is much bleaker if you look at the federal government’s Bureau of Labor Statistics’ numbers.

According to BLS, Illinois added just 40,002 jobs from February of 2015 through July of 2017.

But, according to BLS, Illinois has lost a whopping 29,877 net jobs from January of 2016 through July of this year. Take out July’s horrible preliminary report (which are often revised), and Illinois only added a paltry 530 jobs between January of 2016 and June of 2017.

It almost goes without saying that Rauner’s political opponents will be sorely tempted to blame those lagging indicators on the two-year state budget impasse. The impasse’s negative impacts really kicked into gear starting in the second half of Fiscal Year 2016, which would be January, when the slide began.

Rauner inherited an economy that, according to the same Illinois Department of Employment Security data he uses, added 61,500 jobs in 2013 and 84,600 in 2014, before Rauner was inaugurated, only to slow to a crawl in the past 19 months, despite a tax cut that took effect at the beginning of 2015. So far this year, the “Trade, Transportation and Utilities” sector has lost 9,300 jobs.

Illinois’ gross domestic product was almost $792 billion in 2016, according to the federal government’s Bureau of Economic Analysis. Could a state government’s budget troubles really have an impact on an economy that size?

Well, S&P Global Ratings Managing Director Gabriel Petek said in a statement back in February that Illinois’ “distressed fiscal condition and dysfunctional budget politics now threaten to erode the state’s long-term economic growth prospects.”

In January of this year, another credit rating agency, Moody’s, published a report which claimed Illinois’ “political gridlock is imposing significant economic costs.”

The uncertainty created by the budgetary chaos almost certainly took a toll on the economy. And then there were all the layoffs at Illinois’ public universities due to lack of state funding which were amply documented in the media – 1,500 or so by the end of May.

Gov. Rauner’s opponents will have a point if they pounce on him for damaging the economy. He didn’t create the crisis on his own, but he’s the governor and governors wear the jacket.

And that’s a big reason why he needs to get his own house in order as soon as he possibly can.

As you probably already know, the governor fired his most loyal staff members over a month ago and replaced many of them with staff from the far-right Illinois Policy Institute. Those folks haven’t worked out very well. Rauner has lurched from one self-created public relations crisis to another ever since he purged his staff. A controversy over an Illinois Policy Institute cartoon, of all things, lasted more than a week.

The governor pushed out four of those PR folks last week, but he’ll need to replace them with some competent, experienced professionals if he wants to get back on track. I’m not sure if he can ever explain why he’s not at fault for these lousy job numbers, but he surely won’t be able to do that with his current team.

And maybe a new team could help him figure out what to do about these problems. So far, things are not getting better on his watch.

Rich Miller also publishes Capitol Fax, a daily political newsletter, and CapitolFax.com.

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