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Record Unemployment, Again!

January 23, 2010

The news in South Carolina on unemployment and growth is bad, very bad.  Last December set a record (12.6%), beating the previous record set the month before.  Making the number hit even harder is the lack of effort, at the state level, to adequately address job creation.

Understanding the impact of unemployment is difficult.  Much of the data seems derived from wizard-like people, hiding behind a curtain, distributing information that only confuse matters.  This is before the political spin doctors take charge and really confuse us.  Stepping back from a particular data point and looking at the trend in unemployment rates gives us an index we at least understand.  In this case, the trend is going in the wrong direction.  Six month ago, the rate was 11.7% and has increased in all but one month since.  It does not take Albert Einstein to understand this is a problem.

Depending on what politician you ask answers very greatly, each wanting to show themselves in the best light.  The question really becomes what can a state do about unemployment.  It is unrealistic to expect the state to create jobs.  The jobs they actually create put more individuals on the state payroll, which is not a solution.  What our leaders can do is create an environment that encourages growth.  To borrow from a movie, “if you create growth opportunities, they will come.”

States compete with other states for big, national employers that bring things like manufacturing to the state.  That is something that will help long-term but does nothing to address the immediate need, not to mention other states work just as hard for them.  For a quicker response, the state must turn to small business and the entrepreneur.  Small business growth and startup account for the majority of jobs created in our economy.  It is time the state government gets creative with small business and encourages that growth.  One example being the state can change its purchasing practices to a “South Carolina first” theme.  Even if a price is higher, the state will ultimately benefit from keeping its citizens employed and businesses growing rather than saving a penny per roll on toilet paper.

To be fair, the state may do that now but how would we know?  Our elected leaders remain silent, other than to bash each other for doing to little, on the mater of employment.  At the very least, they must create a positive feeling on opportunities for growth.  As Roosevelt said, “we have nothing to fear but fear itself.”  All that statement really did was change the tone.  It worked too.  Even if we make a few bad turns along the way, it is time to head the boat of employment north and stop floundering.  We still have a strong current to fight but at least that is a start.

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