Opinion: Celebrate Labor Day by making labor easier
In recent years, Michigan has almost fully left the “lost decade” behind. Since 2010, the state has been among the faster growing states when it comes to job and income growth – and we’ve reversed the population decline.
Unemployment and job losses have trended downward. The number of Michigan citizens collecting unemployment has dropped by 90 percent. We haven’t hit our early 2000s peak, but the number of people working has been increasing steadily.
Good public policy played an important role in much of this. Michigan has made it easier to open and run a business, eliminating taxes for many small businesses and moving to a fairer, flatter system for corporations.
The state has also encouraged work in several ways. The state worker’s compensation law was reformed. The previous statute was subject to wide interpretation over what terms like “disability” or “personal injury” meant. And it’s worked – premiums for this fund have fallen by 28 percent despite rising 11 percent nationally. The changes mean this money is going to the people who need it most and businesses can spend their money creating jobs and being more productive.
One area that has not been a positive for the state is the number of people on government-provided health care, particularly Medicaid. Michigan made the unfortunate decision to expand Medicaid eligibility, spending billions more providing what research suggests does little to actually improve public health. The state did, however, recently pass work rules for able-bodied Medicaid recipients. While providing a safety net for the poor is needed, encouraging people to get off of public programs and support themselves if they can is important too.
Michigan also became a right-to-work state in 2013. This law made the state a more likely destination for business investment. But, more importantly, it removed a major obstacle for people who didn’t want to pay money to a union simply to have a job. The freedom of association for workers is key, and the U.S. Supreme Court re-established this with a ruling this summer giving government workers the constitutional right to choose whether to join or pay a labor union.
These changes have been crucial to turning the state around. And despite the tax changes, the growing economy has allowed the state to spend more than ever on education, transportation and paying down debt. So where should we go from here?
The state needs to continue and expand its work on criminal justice issues. Michigan’s prison population has fallen substantially (25 percent from the peak), but there are too many obstacles standing in the way when people get out. Nobody should be forced to hire somebody with a criminal record, but the state should make it easier for that to be an option. Right now, laws preventing ex-offenders from getting licenses — both to drive and work in a variety of occupations — are too stringent. For example, even if they wanted to, a hospital couldn’t hire a nurse who has rehabilitated herself after a low-level drug conviction long ago.
And local communities can help solve this issue as well. Reforms to bail bond and the costs charged to people spending the night in prison, even those not found guilty of a crime, are causing problems by encouraging debt and keeping people from contributing productively to the economy and their communities.
While the state rightly reduce the tax burden on businesses — which benefits everyone — it should do so for individuals. The state budget has been increasing substantially and yet the income tax has not been rolled back as promised when it was hiked “temporarily” a decade ago. Lawmakers have found the funds to spend much more on K-12, community colleges universities, state workers, prisons and more. They should give taxpayers a raise as well, by lowering the state income tax.
This labor day, Michigan’s economy is doing well. But there is always more to be done. So let’s get to work.
Jarrett Skorup is director of marketing and communications at the Mackinac Center for Public Policy.