MCGUIGAN: A layman’s journey through Oklahoma’s right-to-work data

By   /   December 12, 2012  /   2 Comments

By Patrick B. McGuigan | CapitolBeatOK

OKLAHOMA CITY — More than a decade after Oklahoma voters enacted a right-to-work measure, pundits and partisans continue to debate whether right-to-work has delivered on all, or even most, of its promises.

IT’S OK: Since passage of right to work in 2001, Oklahoma has steadily gained ground on surrounding states, and the national averages for positive economic benchmarks.

Early this year, Oklahoma was an exhibit for right-to-work proponents in Indiana. This month, it’s an exhibit for proponents in Michigan.

It’s always difficult to prove causation, and the truth is that all economic outcomes, much like elections in our political system, are the result of increments. Truth be told, arguments before and after passage of right to work in Oklahoma are pretty much the same — except that now, we have the fact of the enacted policy to drawn upon.

Having lived in Oklahoma, I contend the mounting evidence of the past 11 years makes a strong case for the efficacy of the policy. Here is a layman’s journey through the data, so readers can judge for themselves.

Advocates for worker liberty won the political battle on Sept. 25, 2001, when Oklahomans approved a right-to-work constitutional amendment. Politically, that ended the most important ballot issue campaign in modern state history. Millions of dollars were spent for and against, with unions and their allies enjoying a notable — but in the end not sufficient — sending advantage.

The debate over the economic efficacy of right to work will never end, but some facts about our state’s experience are undeniable. Surveying the cumulative good news since passage, including the state’s Per Capita Personal Income (PCPI) rank, find personal income growth went from last in 2001 to second in 2011 among the six states on the nation’s “spine” — North Dakota, South Dakota, Nebraska, Kansas, Texas and Oklahoma.

Oklahoma had 55 percent PCPI growth in nine years, including the eight years after approval of right to work, second only to North Dakota’s 62 percent boost in the same period.

Some critical studies of the impact ignore trends and look at long chunks of time — i.e. the past several decades — concluding that average wages are higher in non-right-to-work states than in right-to-work states.

That is true, so far as it goes.

Oklahoma was always a poor state (and in ways it still is), even with our resource advantages, including energy, farming and other agriculture. But even though we still are a relatively poor state, our present rankings are the highest they’ve been in the modern era, with the exception of the peak of the energy boom in the early 1980s — just before the worst oil bust in our history.

During the past decade, the state’s rankings have advanced despite depressed domestic natural gas prices and decent, but not astronomical, domestic oil prices.

Some analyses from the political and economic left ignore income trends of the past decade — patterns that point to stronger income growth for right-to-work states, including Oklahoma.

Taking a national perspective from 2000-09, Oklahoma underwent a nine-year shift, from 43rd to 34th, in the Per Capita Personal Income ranking. In the past three years, the Sooner State continued a slow advance. According to the Bureau of Business and Economic Research, an arm of the University of New Mexico, working with U.S. Commerce Department data, Oklahoma now rests in 32nd place, at $37,679 a year.

In sum, the Commerce data finds Oklahoma has the third fastest-growing per capita income growth during the five-year period. Investment gurus laud the state for achieving these gains in a time of labor peace and steady growth in demand for labor, even during the Great Recession.

In discerning the impact of right to work, Jennifer Monies, press liaison for the Oklahoma State Chamber of Commerce, stressed Oklahoma’s emergence as one of the hottest places for business expansion or relocation over the past decade.

She points out that last winter Forbes Magazine named Oklahoma the 11th best state in America to do business; RealtorMag tagged Oklahoma City as having the country’s eight healthiest housing market; Business Journal put the state 12th in raw private sector job growth; and Site Selection magazine declared the state to have the 13th best business climate.

In arguably more subjective “quality of life” measures, Oklahoma also scores well. Forbes puts the capital city at 28th out of 200 best metro areas for business and careers. America’s Promise Alliance scored Oklahoma City similarly.

The latest unemployment numbers put the jobless rate nationally at 7.7 percent of the workforce. The statewide number for Oklahoma is 5.3 percent, while in Oklahoma City the October rate was 4.9 percent.

Turning to manufacturing, Oklahoma has suffered just like the rest of the country, but even in this area there is leavening of the data.

A year ago, the state briefly led a national surge in manufacturing employment growth.

Writing for the Oklahoma Council of Public Affairs, Scott Moody and Wendy Warcholik took a swipe at the left-leaning Economic Policy Institute for ignoring productivity increases that have helped retain a comparatively robust manufacturing presence, even as job numbers overall tightened.

The future seems bright, unless national events pull us all down.

The newest review of economic indicators from the Oklahoma Employment Security Commission projects a 9.6 percent increase in manufacturing employment and a 12.2 percent boost in construction jobs.

Specifically, last month’s decade-plus projection found the manufacturing sector “adding 11,810 jobs from 2010 to 2020 with machinery manufacturing and fabricated metal product manufacturing providing more than half (6,600 jobs) of total growth. Construction employment is expected to return to a healthy growth rate of 12.2 percent, adding 8,250 jobs almost all of which are anticipated to be in the specialty trades contractors sector (7,850 jobs).”

Blending all this yields unsurprising conclusions. As Mark J. Perry, analyst for the American Enterprise Institute, noted, since 2009, right-to-work states have created four times as many jobs as states where forced unionism is the norm. Oklahoma fits solidly into that picture.

Enactment of the right to work in Oklahoma contributed to the state’s impressive repositioning from a place of comparative poverty to one of relative opportunity. Demand for labor, especially skilled labor, is increasing and contributing to a net in-migration since litigation surrounding the 2001 proposition finally ended in 2003.

In fact, eight decades after John Steinbeck’s “Grapes of Wrath” immortalized the fate of Oklahoma’s desperately poor migrant workers during their flight to California, writers have begun referring to California’s population loss and Oklahoma’s gains as portending a “reverse Grapes of Wrath.”

Stay tuned. That is an unfolding historical drama that lends perspective, even to the battle over right to work.

Contact Patrick B. McGuigan at Patrick@capitolbeatok.com and follow us on Twitter: @capitolbeatok.

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Patrick B. McGuigan is bureau chief for the Oklahoma City Bureau of Watchdog.org, and works from the press room at the state Capitol. He is also the editor of CapitolBeatOK, and Associate Publisher of The City Sentinel newspaper. In 2013, The Washington Post blog “The Fix” designated Pat one of the best reporters in Oklahoma. In addition to the Oklahoma Society of Professional Journalists, where he serves as state secretary-treasurer, Pat is a member of the National Press Club and the Tulsa Press Club.

  • Peter Gatliff

    One look at all the factorys that have packed up and left the state after “Right To Work” was passed should be an example of a failed law. Kwik Set Lock Co. Bristow ,Delta Fauset and Gaberial Schock Chickasha Ok to start with.

  • http://www.facebook.com/DanDandy Daniel Hutcherson

    I fail to see the connection between right to work and these factories packing up. Are you claiming “but for right to work” these companies would still be here? Were these factories unionized?