By David Knox
Five months before declaring his candidacy for the Republican nomination for president on July 21, Ohio Gov. John Kasich took to YouTube to lay the foundation for his campaign for the White House — or, more likely, for the vice presidential slot on the GOP ticket.
“Guess what, I’ve got some really good news, Ohio,” Kasich said in proclaiming his gospel of economic salvation through job creation. “Our great state has more than earned back all the private-sector jobs we had lost in recent years. That’s right. We had lost 350,000 jobs upon my entering office and guess what, we’re now up 352,000 new private-sector jobs.”
The video, posted March 6, was hardly a viral hit on social media. As of July 1, it had less than 250 views. But Kasich’s message — that his administration had achieved a milestone in job recovery using the traditional Republican formula that, in his words, “lowers the cost of doing business by cutting taxes” while “getting rid of burdensome, unnecessary red tape” — reached its intended audience. The 352,000 jobs claim was picked up by major news media both in Ohio and nationally. The New York Times’ March 19 profile of Kasich, which set the table for its coverage of his presidential aspirations, reported the number without challenge or context.
That’s not to suggest Kasich fabricated the figures. He didn’t. But considerable statistical sleight of hand was needed to make them add up the way Kasich needed. That’s because job growth in Ohio has lagged behind the nation as a whole over most of the four-plus years since Kasich took office in January 2011. Since then, total nonfarm employment in the Buckeye State rose 7.3 percent compared to the national average of better than 9 percent, according to the U.S. Bureau of Labor Statistics.
Kasich sidesteps that fact, both in the video and during the first four Republican presidential primary debates, by talking only about Ohio job gains and eschewing comparisons to other states or the nation. But even with that limited scope, he faced a challenge: The traditional definition of job recovery — the one used by the national media in the spring of 2014 to report that the United States finally had recouped all 8.7 million jobs lost after the pre-Great Recession peak in January 2008 — would show Ohio failing to reach that goal.
The Buckeye State isn’t alone. The Wall Street Journal reported on June 20, 2014 that Ohio was among 33 states with total nonfarm payrolls below their pre-recession peaks. Today — a year and a half later — Labor Department figures show Ohio is one of 15 states still short of that mark.
If Ohio hadn’t fully recovered from the recession, Kasich needed an alternative metric to burnish his credentials as a job creator. The fix he came up with could have been inspired by Star Trek’s Capt. James T. Kirk. As all Trekkies know, when confronted with Starfleet Academy’s Kobayashi Maru training exercise designed to test cadets’ response to a no-win scenario, Kirk found a creative solution: He unilaterally changed the rules of the game.
So did Kasich — twice, by counting only private-sector jobs and by adopting a time frame to define job recovery that had more to do with politics than economics.
Kasich is upfront about ignoring public sector employment, which is down more than 2 percent since he took office and had been shrinking for several years before that.
“All we have counted in the entire time I’ve been in is private-sector jobs,” Kasich told reporters at his news conference in March. “We are not talking about government-sector jobs. … You only grow your economy with private-sector jobs.”
While that response fits into the tradition of conservative talking points, most economists would disagree — if only because the wages and salaries of the public sector workers contribute significantly to the state’s economy: About one in seven of Ohio’s nearly 5.4 million nonfarm jobs is in the public sector.
Nor are those employees the faceless bureaucrats conjured up by Kasich’s preferred phrase, “government worker.” More than two-thirds of Ohio’s three-quarter million public workers are employed at the local level. They are the teachers, bus drivers, police officers, firefighters, trash collectors and the myriad of others who provide essential services for the state’s cities, counties, villages, school districts and other local government agencies.
But Kasich had to do more than exclude the public sector to make his numbers work. He had to change the time frame defining the recovery. Most news outlets assumed Kasich was claiming to have recovered all private-sector jobs lost during the recession. That’s certainly what his gubernatorial campaign website stated in promoting his video: “Data released this morning shows Ohioans have now created more private sector jobs than were lost during the recession.”
Kasich never used the R-word during the GOP debates last year and in his video cited only jobs “lost in recent years.”
Asked to spell out what that means, Kasich’s press secretary, Rob Nichols, confirmed the governor was talking about the net number of jobs lost during the four-year term, 2007 through 2010, of his predecessor, Democratic Gov. Ted Strickland.
The choice of that yardstick, which was adopted early in Kasich’s administration, has a double benefit. First, it ignores the fact that Ohio started shedding jobs well before the nation as a whole. Ohio hit its pre-recession business cycle peak of 5.45 million non-farm jobs in March 2006 — 10 months before Strickland took office — during the administration of Republican Gov. Bob Taft.
Using a net figure for job losses during the Strickland years also hides the solid gains recorded in the Democrat’s last year in office. Ohio lost a total 451,100 jobs before hitting bottom in February 2010. But in Strickland’s final 10 months, Ohio added 64,300 jobs — a 1.3 percent growth rate that easily bested the national average of 0.8 percent over the same period.
So how many more jobs does Ohio need to regain to make a full recovery from the pre-recession peak?
Nearly 17,000, according to the Bureau of Labor Statistics’ November employment report.
But that statistic obscures a much bigger shortfall. Ohio is one of three rust-belt states — the others are Michigan and Illinois — that never recovered all the jobs lost in the previous recession, in 2001. Even after recouping the jobs that disappeared in the Great Recession, Ohio needs to create 182,300 more to get back to the record 5.64 million employed in May 2000 — a decade and a half ago. (See chart below.)
That’s the unreached milestone Kasich has avoided talking about.
Total nonfarm Ohio employment, seasonally adjusted January 1990 through November 2015
Source: U.S. Bureau of Labor Statistics (http://www.bls.gov/sae/)
David Knox is a veteran Ohio newspaper reporter and editor, including more than 20 years at the Akron Beacon Journal — the last 10 as the newspaper’s computer-assisted reporting specialist. He has been a freelance journalist since March, when he retired as managing editor of The (Medina County) Gazette. He can be reached at email@example.com.
Notes On The Numbers
All the job numbers in this report — including those cited by Ohio Gov. John Kasich — are derived from a single source — the Current Employment Statistics program of the U.S. Department of Labor.
The CES program is a cooperative effort of the department’s Bureau of Labor Statistics and state agencies that provides monthly employment counts, hours worked, and earnings estimates for the 50 states and about 450 metropolitan areas. The statistics are based on a survey of more than 143,000 non-agricultural private businesses and public-sector employers and includes more than 25,500 establishments in Ohio.
The definition of a jobs recovery used in this report is straightforward: It’s when the CES’s monthly count meets or exceeds the peak reported before the drop in employment accompanying the recession, which officially began in December 2007 and ended in June 2009.
Using that definition, the national news media reported the United States had recouped all 8.7 million jobs lost in the recession when the preliminary results of the CES survey showed total nonfarm employment in May 2014 had exceeded the pre-recession record of 138.4 million jobs, set in January 2008. (Subsequent revisions of the data showed the U.S. actually had achieved that milestone a month earlier, in April 2014.)
But drilling down into the CES data reveals the recovery has been slow and uneven. Applying the same criteria for employment recovery used for the nation to the individual states, The Wall Street Journal found the May 2014 payroll totals below their previous peaks in two thirds of the states. Updating that analysis with the latest November 2015 figures shows 15 states — Ohio among them — have yet to recover all the jobs lost during the recession.
Economic experts stress that totaling payrolls doesn’t tell the full story of the recovery. They point out that simply comparing the before-and-after-recession job counts is an overly optimistic measure of recovery. That’s because it doesn’t account for additional jobs needed to meet the demand of a growing population. Between 2010 and 2014, for example, the ranks of people in the United States between the prime working ages of 18 and 64 grew by nearly 5 million, according to Census Bureau estimates.
Nor do the employment totals answers the critical question of whether the new jobs created during the recovery pay as well or provide as many hours of work as the jobs lost in the recession.