After years of bad decisions and then paralysis, the General Assembly now has a collection of bills to review that stem from the recommendations set forth in Moving the Needle, a joint report by the Senate Policy Office and the business backed policy group RIPEC.
Before I look into the actual legislation, I wanted to make a
general comment about the obsession that people have regarding national
business rankings. Rhode Island all too often gets hung up on its
self-defeating cynicism and inferiority complex.
Rather than looking at the assets that exist in the state and developing a plan to use those assets to grow the economy and support the businesses that currently exist, policymakers seem obsessed with how we rank nationally. People generally forget that before the global economy went down the toilet, Rhode Island had an unemployment rate that matched the national average.
A lot has happened in the past 6 year, but in March 2007 the state’s unemployment rate was 4.8%. Aside from the global recession, I’m not sure the structure of every state’s economy has changed all the dramatically.
Rather than looking at the assets that exist in the state and developing a plan to use those assets to grow the economy and support the businesses that currently exist, policymakers seem obsessed with how we rank nationally. People generally forget that before the global economy went down the toilet, Rhode Island had an unemployment rate that matched the national average.
A lot has happened in the past 6 year, but in March 2007 the state’s unemployment rate was 4.8%. Aside from the global recession, I’m not sure the structure of every state’s economy has changed all the dramatically.
One word of advice would be to just stop looking at national
ranking. Rhode Island is not Texas. Rhode Island will never be
Texas. The only way Texas will ever be relevant to Rhode Island is if
there is something very specific that Texas does that Rhode Island may want to
replicate.
I humbly offer my comments about specific pieces of legislation
while acknowledging that overall much of it makes sense, but will likely only
be marginally beneficial.
·
Division
of Economic Data and Information: This, to me, seems like it should exist within the
Economic Development Corp. But aside from where the function sits,
gathering detailed economic data, analyzing that data, and using it to inform
strategy is critical to growing the economy. Equally important, though,
is that this needs to be something much more than a person who merely
aggregates information from the Division of Labor and Training.
·
Long-Term
Strategic Visioning Document: Planning is good and every successful business and
government does it. Rhode Island should do it too. Something that
has always frustrated me about Rhode Island is its lack of
implementation. If one were to do a scan of the past few years, they
could find a whole assortment of studies, economic development plans, guidance
documents, etc. But what the state has not yet done, what it seems the
state is incapable of doing, is developing an implementation plan, a governance
structure to facilitate the execution of the implementation plan, and granting
it the authority and autonomy to do it. Again, I think much of this
should be housed in the RIEDC.
·
Commerce
& Workforce Coordination Cabinet: I’m all for cross-departmental coordination, but I fear this
may just be another meeting that people have to attend. I think it comes
down to how much autonomy it will have to offer recommendations for the
long-term strategic vision, how willing this or any Governor is at listening to
and incorporating that advice, and how serious public officials will be with
the task at hand.
·
Business
Presence on Statewide Planning: Planning for the state’s transportation, water system,
affordable housing, growth centers, economic development, etc. is a skillset
that business may not have. I’m fairly indifferent about including some
business presence on the State Planning Council to incorporate some additional
information that they may not be getting, so long as they let the professionals
do their jobs.
·
Preserving
the Renewable Energy Fund: Yes please. Additionally, I would boost the fund to
at least $10 million and provide low interest loans and limited grants to those
who would like to invest in renewable energy for residential properties.
·
Back
to Work Rhode Island: I
have very mixed feelings about this. On the one hand, unemployed Rhode
Islanders can quickly become irrelevant in a rapidly changing labor
market. Ted Nesi recently highlighted this when he asked if Rhode Island is suffering from
hysteresis. The longer an
unemployed worker is out of a job, the less appealing they become to potential
employers. If for nothing else, getting some skill training and having a
recent job listed on a resume makes me want to support this. On the other
hand, I wonder what the oversight mechanism will be. I can picture
unscrupulous employers abusing this system and churning though workers on an
ever-repeating 6 week basis (think restaurants, retail, hospitality, etc.)
without staff time dedicated to oversight.
·
Childcare
for Participants in Workforce Training and Childcare Assistance Pilot:YES. This is critically important for
single parents who want get job training but cannot afford child care. I
would also add transportation vouchers for them to get to and from training.
·
Enhanced
Jobs Match:The state should be
thinking more creatively about linking the unemployed to employment
opportunities, especially considering the dwindling funds for job training. The
state needs a system that better links the supply of skills that the unemployed
has with the demand for skills that employers need. If there is a huge
unmet need for a prolonged period of time, then training funds should be used
to meet that need. The problem is, and it is no small problem, it will
take more time to screen candidates at the local One Stops, which means if the
state doesn’t put more resources to this important task, fewer people get
served. If DLT needs help with this system, they merely have to tap the
vast network of tech folks in Providence who could probably design and build a
better system than what we have over the weekend… while they sleep.But more to
the point, Rhode Island needs more than just this. To put it bluntly, the
public workforce system is broken. In particular, it is underfunded and
operates in silos. And in Rhode Island, the folks at Workforce Solutions
of Providence / Cranston don’t have the same level of authority as the folks who
work at Workforce Partnership of Greater RI. The former are city
employees, the latter are DLT employees with much greater access. Also,
there are not enough people in the public system who can speak Spanish. I
wrote a report for the City of Providence last year called Rethinking Workforce Development for
Providence’s Labor Force that details a lot of the issues that make the system
inefficient and ineffective. The system needs more than a new website.
·
Help
Former Students Finish Their Degree: It’s a good idea to help people get their degrees, but
there are a lot of reasons why people leave college prior to completion:
transportation, shift change, child care, used up Pell grant, etc.
Communicating with students to get them to finish is a good thing, but someone
needs to actually do it.
·
Reverse
Transfer: This would allow
for credits earned for a Bachelor’s degree to be transferable toward an
Associate’s degree at CCRI. Might as well, but it will likely be
underutilized.
·
Economic
Development Tax Credit Accountability Act and Tax Credit Statement of Purpose: Yes, but EVERY SINGLE tax credit and
expenditure offered by the state should be reviewed for their cost and
effectiveness at generating economic growth. Any tax credit or
expenditure that is shown to not generate an appropriate level of growth to
justify its cost should be eliminated.
·
Restore
Historic Tax Credits: Rhode
Island, I want you to understand that if you do this, it will cost a LOT of
money.
Much of what came out during Paiva-Weed’s news conference is
non-controversial and fairly common sense. To quote a colleague:
“Congratulations to the Rhode Island Senate for formulating a plan to get us
out of the recession, 4 years after it officially ended. I knew you could do
it.” The unfortunate reality is that it will take a while for the state
to grow out of the recession. This is just the first step.
Brian Hull received
his Master's Degree in Public Policy from the Kennedy School of Government at
Harvard in May 2012. He is currently a Senior Consultant with the leading
research and strategy firm on U.S. inner city economies. Professionally, he
works on urban-based economic development projects for organizations and
institutions across the country, identifies how large institutions can better
provide local economic opportunities for low-income urban residents, and explores
innovative workforce development systems to create a more productive local
labor force.
