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Business-friendly policies put Florida economy in overdrive, governor says

By   /   August 10, 2017  /   News  /   No Comments

Florida Gov. Rick Scott’s office has been highlighting new economic numbers on state job growth, consumer confidence and the unemployment rate, arguing that they validate his business-friendly policies.

Consumer optimism numbers for July contain a few undercurrents of uncertainty, however, and Scott’s political opponents say the state’s economic growth has come in the form of low-paying jobs and relatively stagnant wages.

Scott first ran for governor on a vow to create 700,000 private-sector jobs in seven years. Based on total numbers, Scott has nearly doubled that promise. His office announced last week that since December 2010, the Florida economy has produced nearly 1.4 million such jobs, and the state’s unemployment rate has dropped to 4.1 percent, the lowest rate in a decade.

“Florida’s job growth has also outpaced the nation’s for nearly five-and-a-half years, and we are leading the country in a variety of industries, proving that our efforts to diversify the economy are helping to create new opportunities every day,” Scott said in a prepared statement.

The fact-checking website PolitiFact Florida, however, said Scott promised 700,000 jobs above what the state would have created through the normal economic cycle. Because economists predicted Florida would add 1 million jobs on its own during the period 2010 to 2017, Florida needs to add 1.7 million jobs for Scott to keep his promise, the website concluded.

Scott’s Democratic opponents also dispute the quality of the jobs that have been produced during Scott’s term. House Minority Leader Janet Cruz, D-Tampa, sees Republican leaders as more concerned about the profit margins of large corporations than the plight of Florida families.

“While Governor Scott and Republican leadership like to celebrate the low-wage jobs their commitment to corporate welfare has allowed their special-interest donors to create, the picture of Florida’s working families is much more dire,” Cruz said in an email to Watchdog.org. “Over the last decade, wages have remained stagnant for our workers, more than four out of 10 households struggle to pay for basic necessities, and almost of a quarter of Florida’s children are growing up in poverty.”

But the Florida Consumer Sentiment Index, which is conducted by the University of Florida’s Survey Research Center, reports a generally upbeat attitude among Florida residents about the state of the economy. Consumer sentiment rose 1.5 points last month to 97.7, the highest level since March and one of the highest readings since 2002.

A value of 100 represents the same level of consumer confidence reported in 1966.

The July survey also found that  three component measurements had increased, while two had decreased. One concern reported by Hector Sandoval, director of the university’s Economic Analysis Program, was that men’s perceptions of current economic conditions in the state declined in July, as did the perceptions of those under 60.

“It’s hard to pin down a reason why they think this,” Sandoval told Watchdog.org, “but in general the economy has been growing at a greater rate than the U.S., and that’s something that the people can feel.”

The men’s responses about how their current personal financial situations – compared to a year ago and compared to their expectations for a year from now – declined compared to men’s responses during the previous months.

Still, Floridians’ expectations about the national economy over the next several years remain high, according to the survey results.

“The gain in July’s sentiment came from consumers’ future expectations about the economy in the medium and long run,” Sandoval said in a statement when the survey was released. “Remarkably, these positive expectations are shared by Floridians across all demographics and economic levels.”

Sean Snaith, the director of the Institute for Economic Competitiveness at the University of Central Florida, agreed that consumer confidence in the state was strong and would remain high into 2018. A number of factors are responsible for the state’s strong economic numbers, including population growth, rising tourism and Scott’s focus on creating a business-friendly environment, according to Snaith.

“I think the policies are part of it,” he told Watchdog.org. “Obviously, there’s no state income tax here.”

A state economic forecast issued in June by the institute predicted that the state economy will expand by 3.7 percent in 2018 and that Florida job growth from this year through 2020 will top the national average by 0.8 percent.

And although wage growth in Florida has been sluggish in the years after the Great Recession, the institute predicts wages in the state will rise by 4 percent this year and by 5 percent in 2018.

“Tourism is obviously a big component of the state’s economy, and it’s been performing well,” Snaith said.

Some of those tourism jobs are low-wage, but the state has also produced growing numbers of better-paying jobs in professional business services and construction, he said. And the discussion of wages in Florida often fails to take into account the lack of a state income tax, which translates into more disposable income for workers overall, according to Snaith.

In addition, Florida has also made strides in diversifying its economy, producing growth in biotechnology in Orlando and the commercial space sector in other parts of the state, he said.

Sandoval also sees the high consumer confidence level continuing at least through the end of the year.

“Visitors are coming and unemployment is decreasing,” he said.

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