PALMETTO STATE’S UNEMPLOYMENT RATE LIKELY TO CONTINUE RISING
Last November this website published a story about how South Carolina – which continues to lag behind the rest of the nation in jobs, investment and income levels – was particularly susceptible to a European economic crisis.
“In the increasingly likely event that Europe plunges headlong into another full-blown recession, South Carolina is likely to suffer more than most states,” we noted, using as the basis for that contention a Wells Fargo report which ranked state economies based on their reliance on European exports.
Where do we rank? Second in the nation … and it’s looking like those chickens will be coming home to roost sooner rather than later.
Recently, we dined with an industry expert who told us that our state’s economy (particularly its manufacturing sector) would begin shedding jobs by the thousands beginning in 2013. Ruh-roh, right? According to this expert, the reason for these layoffs was precisely what we outlined back in November – a crumbling European economy placing a drain on exports.
We decided to give that theory a test drive over the weekend, asking several of our best business sources where they believed the South Carolina unemployment rate would be a year from now (it’s currently 9.4 percent, the fifth highest rate in the nation).
The best answer we got?
“Somewhere between 9.6 and 9.8 percent,” one source told us.
“Over eleven percent.”
Obviously, either one of those numbers is terrible news for S.C. Gov. Nikki Haley, who has staked her political career – and sales of her autobiography – on South Carolina’s jobless rate. Haley actually responded to June’s disappointing jobs report pretty well, basically saying that it meant she needed to start working harder.
That’s for damn sure.
But are Haley’s “economic development” efforts helping or hurting? Or do they have our state stuck in neutral?
In contrast to her campaign rhetoric about lower taxes and support for small business, Haley has governed as the consummate crony capitalist – doling out huge taxpayer-funded incentives to select corporations (effectively bribing these companies to locate here). That’s good for getting big “jobs announcements” on television and in the newspapers, but as we’ve pointed out repeatedly it is terrible for existing businesses and individual taxpayers – who are forced to pay a higher tax burden in order to absorb the cost of the government handouts.
Given our exposure to what’s going on in Europe, Palmetto State leaders need to be particularly conscious of the impact that government handouts (and the perpetual growth of state government) have on our overall business climate. We simply cannot afford to make our state any less competitive than it already is.
Sadly, after one lost decade all signs point to South Caroline entering another.
What do you think? Vote in our poll and post your thoughts in our comments section below …