If Utah is ranked as the No. 1 state for doing business, shouldn’t it be the No. 1 easiest state in which to find a job?
That’s a question Glenn Wright, chairman of the Summit County Democratic Party, is asking in the wake of The Governor’s Utah Economic Summit held March 28.
“On unemployment rates for states we rank No. 18. That’s not something to brag about,” Wright said in an interview Friday.
In February, the Department of Workforce Services estimated the state’s seasonally-adjusted unemployment rate to be 7.7 percent. Nationally, it was 8.9 percent. In January, Summit County’s rate was 6.9 percent.
Wright said he believes the state deserves its accolades for being business-friendly, but it’s mostly because of low taxes. Never raising taxes and giving big rebates doesn’t always translate into jobs, he said.
Some of the states with the lowest unemployment rates have some of the highest tax rates. Vermont, Hawaii, Maryland and Maine are examples, he said.
What are they doing better than Utah? They’re beating us at our own game, he said.
States with the lowest unemployment rates enjoy big revenue from mineral extraction and recreation Utah’s two strongest industries. These states invest large amounts of this tax revenue into the education of their workforce, and into the quality of their public schools, Wright said.
These are the two biggest draws for companies not necessarily low taxes.
“We’ve been eating our seed corn in maintaining our economic viability,” Wright said. “Our educational results are getting steadily worse.”
Government-funded preschool and all-day kindergarten have proven to raise test scores, but the Utah Legislature refuses to fund them, he said.
“If our only priority is not raising taxes, we’re limiting ourselves on what we can do to be competitive in the nation and the world,” he added.
Nor does Utah government need to raise taxes to better fund education. It just needs to quit giving so much tax money away.
“The sales tax exemptions for corporations in the Utah Tax Code are 15 pages long,” he said.
It includes an exemption for purchasing mining equipment. Since when is Utah’s coal industry struggling? They have a virtual monopoly on powering the state, Wright said.
With all the rebates the state offers to attract new businesses, it’s hard to calculate whether there’s a net benefit, he added.
“Let’s sunset some of those laws and see the effects. If they’re positive, renew them. If this money went straight into pockets, cancel them,” Wright said.
And many Utah jobs were saved by money from the Troubled Assets Relief Program that lawmakers didn’t want to accept, he said.
“That money saved thousands of jobs. Otherwise our unemployment rate would be significantly higher,” Wright said.