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Job creators in Indiana way ahead of Illinois counterparts

Time to better nurture Prairie State’s potential

Published: Thursday, July 10, 2014 1:15 a.m. CDT

SPRINGFIELD – For every one job Illinois has created during the past decade, Indiana has created 35, according to data from the U.S. Bureau of Labor Statistics.

I’ve been to Indiana.

I know Hoosiers.

And the average Hoosier isn’t any smarter than the rest of us.

They may think so, but we know better.

But let’s face it, their economy is outperforming Illinois’ by leaps and bounds.

The two states have identical climates – rich farmland, strong manufacturing heritages, and similar workforces.

But the Hoosier State is kicking our economic butt six ways to Sunday.

It’s almost as though the Land of Lincoln showed up for race in a 1958 Edsel and can’t understand why our neighboring states are zooming by us.

Folks, Illinois has one of the lowest job creation rates in the Midwest, according the Bureau of Labor Statistics.

This past month, Illinois’ unemployment rate fell to 7.5 percent from 7.9 percent.

Sounds good, huh?

Think again.

The total number of jobs contracted by 2,600, with a loss of 5,400 private-sector jobs and an increase of 2,800 government jobs.

The decline in the unemployment rate was driven by workers just giving up.

When workers stop searching for a job, they are no longer counted as unemployed. Illinois’ labor force shrank by 14,494 people in May as Illinoisans threw up their hands and quit knocking on doors and thumbing through the want ads.

Texas led all states with 48,400 new private-sector jobs, according to the federal labor statistics.

Here are a few things Texas and Indiana have going for them:

n Both are right-to-work states, where workers are free to join a union or not. Increasingly, industry uses a state’s right-to-work status as a litmus test to determine where they will expand. By the way, since Indiana became a right-to-work state in 2012, wages there have gone up.

n In March, Indiana cut business taxes. Illinois lawmakers, on the other hand, spent the bulk of their legislative session pondering various tax hikes. By contrast, Texas has no income tax at all.

n Workers compensation rates in Illinois are far higher than Indiana, Texas, and most other states. This leaves the Land of Lincoln at a grave disadvantage.

Illinois also needs to consider stepping away from the estate tax. While most states no longer levy a death tax, Illinois persists in doing so.

That makes it more difficult for farms and small businesses to pass from one generation to another.

And that reduces employment opportunities for the rest of us.

It’s time for Illinois to unshackle its economic potential by emulating states like Indiana and Texas.

Note to readers: Scott Reeder’s column is underwritten by the Illinois Policy Institute.

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