Georgia sets nation’s highest unemployment rate, fuels governor’s race

Libertarian Andrew Hunt: The metro Atlanta entrepreneur wants to eliminate state employment taxes in order to encourage hiring. His "Jobs Powerhouse Program" would incentivize jobs in high-paying sectors by reimbursing federal payroll taxes for positions paying $11 per hour or more. That refund would require $2.5 billion from the state budget, but Hunt says it could be carved out by cutting wasteful programs. He believes the resulting tax revenue bumps would exceed the cost.

Georgia notched the nation’s highest unemployment rate for the second month in a row, a dismal ranking that further inflamed the race for governor.

State Sen. Jason Carter, a Democrat, wasted little time Tuesday excoriating Republican Gov. Nathan Deal over the state’s 7.9 percent rate — worse than Mississippi and Alabama, the unionized Midwestern states and the liberal Northeastern states that many conservative politicians have long pilloried as economically inferior.

“Gov. Deal has driven Georgia to the very bottom,” Carter said in a statement 50 minutes after the September jobs report was released by the Bureau of Labor Statistics. “By his own words, he’s rejecting facts instead of accepting responsibility for this crisis. If he can’t even see the problem, why should we trust him to fix it?”

Deal, who has labeled the monthly job rankings “historically faulty,” countered that BLS statistics show Georgia adding jobs at a rate higher than the national average with more than 80,000 added the last year.

“His policies will continue growing jobs in order to keep Georgia the No. 1 place in the nation to do business,” spokeswoman Jennifer Talaber said in a statement.

The economy, with two weeks to election day, holds center stage as the two warring candidates try to one-up each other over who’d better boost employment in Georgia.

Deal has spent the year extolling a glass-half-full platform of new jobs created and lofty business rankings by national publications. Roughly 300,000 jobs have been added on the incumbent's watch and Deal vows that his tax cuts and incentives will lure more industry and jobs. He cites top-in-the-nation business rankings bestowed upon Georgia by CNBC and Site Selection Magazine.

Carter, meanwhile, sees the glass as near-empty and Georgians thirsty for good-paying jobs. BLS statistics show that Georgia remains 215,000 jobs shy of pre-recession levels. And, last month, roughly 15,000 private sector jobs disappeared.

A third candidate, Libertarian Andrew Hunt, says the current unemployment rate — two points higher than the national average — is unacceptably high and argues for spending cuts and incentivizing better-paying jobs.

Rhetoric notwithstanding, economists say there’s little governors can do directly to grow jobs. Voters, though, like rankings and glom on to the monthly jobs report as easy-to-grasp evidence of the health of the economy.

"The governor argues a major reason he should be re-elected is because he brought all these jobs into this state," said Charles Bullock, a University of Georgia political scientist. "So having led the nation in unemployment for two months in a row doesn't help with that kind of message."

"Companies have turned cautious. There's nothing to stimulate growth or give them a reason to hire," said Michael Wald, a former BLS economist in Atlanta. "In some parts of the country, you've got shale oil. In other parts, you've got growth in technology, like California. In the Midwest, you had agriculture with high farm prices. You've got none of those in Georgia."

Deal, though, points to the tepid job growth and Georgia’s position in a still-growing Southeast as proof of sunnier economic times to come. He cites the tax cuts and credits he pushed for the agriculture and manufacturing industries that have led, some firms say, to new or expanded operations in Georgia. Deal vows to keep Georgia’s tax burden low, but has made no promises about a broader tax overhaul.

Instead, he proposes modest policy changes to help more Georgia-based businesses win state contracts, an expanded grant program to cover tech school tuition in high-demand fields and a partnership between colleges and private firms to make students more business-ready.

Scraping the unemployment rate barrel, though, puts Deal on the defensive. He questions the reliability of the BLS data and labels the jobless metric a statistical “outlier.” Good jobs, he sunnily predicts, are around the corner.

“We are coming out of this Great Recession. We’ve seen revenues drop, but we’re seeing revenues grow. And we’re almost back to pre-recession levels. They’ve grown every year in my administration,” Deal said during a debate this month.

Carter, from Atlanta, says a course correction is needed. He rails against the big-money boys winning the governor’s ear and the state’s business, adding that Deal’s friends get perks while the middle class gets left behind. He calls the governor’s economic policy a “grab bag” of tax breaks and incentives without guiding philosophy.

Deal counters that Carter voted for many of the policies he now criticizes, including tax breaks for behemoths like Gulfstream and Delta.

Carter also pledges not to raise taxes, though he wants to revisit the losing 2012 sales tax plan for transportation. His populist-tinged economic pitch begins with a promise to significantly boost education spending by cracking down on tax cheats and cutting wasteful spending and using the savings to create more jobs.

“The only thing that’s happening right now in terms of economic development is a single-ingredient recipe that says we can do one-off negotiated tax breaks for people who are willing to come in with a big factory,” Carter said.

“We have to have a tax structure that supports the middle class and small business,” he said. “Right now that’s reserved for people who have lobbyists. Right now what we need is to be sure that we have a governor that will stand up for the middle class and small businesses.”