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MEPC Welcomes New Policy Fellow, Francinia McKeithan

August 30, 2011

Filed under: Staff — admin @ 2:28 PM

Francinia McKeithan will serve as the 2011-2013 State Fiscal Analysis Initiative (SFAI) Policy Fellow with the Mississippi Economic Policy Center (MEPC).

The SFAI policy fellowship aims to expand the diversity of voices that speak with authority in state policy debates.  Sponsored by the Center on Budget and Policy Priorities, fellows research and write analyses on current policy issues; brief policymakers, journalists, and others on these issues; and serve as a resource for advocates and community groups.

Francinia comes to MEPC after having worked as a Research Associate for the Office of Research Development in the Vice Chancellor’s Office for Research and Economic Development at the University of North Carolina at Chapel Hill (UNC).

Prior to that time, her work included internships with the South African Council of Churches’ Office of the Parliament and concurrent internships with the Women’s Rights and Education departments of the American Federation of State County and Municipal Employees (AFSCME).

Her undergraduate studies included a BA in African and African American Studies partnered with a BA in Sociology along with dual certification in Public Service and Social and Economic Justice.  After graduation, she enrolled in Graduate School at UNC and received a Master of Public Administration in conjunction with a Master of Social Work and certifications in Nonprofit Leadership and Child Welfare Education.  Francinia’s policy and research interests include child welfare, education policy, social and economic justice, and the relationship between education and life outcomes.

We are pleased to have Francinia join our team. She will be focusing on state budget and tax policy and issues affecting low-income families here in Mississippi.

 

Do Mississippi Universities Have Enough Resources to Build Up the State’s Workforce?

August 26, 2011

Sid Salter’s column calls attention to a developing funding trend among the state’s public universities. Institutions of Higher Learning like Mississippi State University are increasingly looking to private giving to help address the financial strain that comes when limits in state funding and growing student attendance converge. The column notes that “The troubling part of that budget reality is that the cuts are coming at a time of increased enrollment as students head back to universities to get new skills in the new economy after the prolonged recession.”

More and more students return to university campuses with the hope of increasing skills, earning a degree, and moving into higher wage employment. As high school graduates and adults pursued courses, university enrollment experienced a particularly strong uptick between 2008 and 2010.  From the fall of 2008 to the fall of 2010, Mississippi’s public universities enrolled an additional 3,100 undergraduate students, the largest real increase in students among the years charted.

Enrolling more students puts increased demand on a university’s faculty, administrative staff, infrastructure and classroom, library, and dormitory space. Inadequate funding of universities can force schools to pass costs on to students through tuition, over half of which already need to take out student loans to finance their education.[i]

While a challenging funding environment for universities persists, leaders across Mississippi are seeking ways to increase the number of higher wage, higher skill employment opportunities in the state. Increasing such opportunities will mean that employers, workers, and community leaders will depend on the post-secondary education system to meet industry and workforce needs.

The increasing demands set on the state’s university system need to be met with adequate resources. The knowledge that public universities are increasingly turning to private giving to make ends meet underscores the importance of taking a balanced approach that includes raising revenue instead of a cuts only approach that constrains education systems in a time of growing need.

Author: Sarah Welker, Policy Analyst 


[i] National Center for Education Statistics. Integrated Postsecondary Education Data System. Financial Aid Data for FY2008-09.

 

 

Debt Limit Deal will Mean More Job Losses for Mississippi

August 22, 2011

Filed under: Budget & Tax,Income & Working Families,Jobs — admin @ 11:18 AM

The large federal spending cuts prescribed in the recent debt limit deal from Congress will mean more cuts for state budgets as well–resulting in more jobs lost in state and local economies.

While specific cuts have not yet been decided on, some general areas are outlined for cuts, including “non security discretionary” spending.   According to the Center on Budget and Policy Priorities, “Fully one-third of this category of federal spending flows through state governments in the form of funding for education, health care, human services, law enforcement, infrastructure, and other services that states and localities administer.”

If the supercommittee, the group tasked with finding the cuts prescribed, decides to include Medicaid in the spending cuts, Mississippi will be hit especially hard.  Mississippi receives the largest federal Medicaid match rate—meaning it relies on federal funding for a larger percentage of Medicaid funding than any other state.

These cuts will mean more jobs lost on the state and local level.  Public sector jobs in Mississippi have already decreased by almost 8,000 in the last year and are now at 2007 levels.  At the same time, needs for public sector services like education and health care and infrastructure, have become even more vital for our economc recovery.  The chart below shows public sector job levels in Mississippi over the last few years.

Public Sector Jobs in Mississippi January 2007 to Present

Not only do public sector job losses affect the quality of and access to vital public services, they also lower demand for goods and services in the private sector. Ultimately, this drop in demand for goods and services could result in job losses in the private sector. Without new revenue on the federal and state level, these job losses will continue to strain our fledging economic recovery.

Author: Sara Miller, Senior Policy Analyst
Source: Economic Policy Institute

 

Balanced Approach Critical to Long Term Economic Success of Mississippi

August 18, 2011

 

Recently, the 2011 Kids Count Data Book and state profiles of child well being were published by the Annie E. Casey Foundation.  Inevitably, stories will be written about Mississippi’s routine ranking of 50th on the Kids Count scale, about some incremental gains and the long road the state needs to travel to make improvements.  After reading these stories for a number of years, I’m of the opinion that the ranking is not the most useful indicator in the Kids Count Portfolio for eliciting a call to action or reforms for improvement.

Between the lines of the overall ranking, however, a number of indicators reported by the Census and Kids Count show that Mississippi is at a cross roads.  In the absence of real policy reforms that address the root causes of long standing poverty the indicators paint a picture of limited economic progress and potential as we move into the future.

The first indicator includes a demographic profile of Mississippi’s children. For the first time, the 2010 Census reveals that there are now more children of color in Mississippi than white children.  Of the children of color, the vast majority are African American – nearly 93%.

Yet, African American children as a group start off much further behind their white counterparts.  The chart below illustrates the disparities by child poverty rate.

Only in Minnesota and Wisconsin is the child poverty gap wider between white children and African American children than in Mississippi.  The difference – in Mississippi, African American children make-up nearly 44% of the child population – in MN and WI, African Americans only comprise 7% and 11% of the child population respectively.

Children who grow up in poverty are less likely to graduate from high school and go to college. They are also more likely to become incarcerated and to receive public assistance at some point in their lifetime.  If nearly a quarter of Mississippi’s future workforce is growing up in poverty, the economic prospects of the state 5, 10, 15 years down the road are essentially capped.

Recent budget cuts have only exacerbated the negative effects of poverty by even further limiting the effectiveness of systems that are in place to create a pathway to opportunity.  When thousands of children were no longer able to receive child care certificates because the money simply wasn’t available to provide children with access to child care, the whole state lost.  The children lost access to a learning environment that could be preparing them for kindergarten.  Parents who lost their child care found their employment situation threatened.  Child care providers – who happen to be private sector employers – also saw an important revenue stream cut which also affected the jobs of the teachers in centers across the state.

MEPC has long advocated a balanced approach to budgeting that includes raising revenues.  Data and stories like those found in between the lines of news stories and sound bites underscore how important the balanced approach is to the long term economic success of the state.


Author: Ed Sivak, MEPC Director

 

 

A Closer Look: Underemployment in Mississippi

August 16, 2011

Filed under: Unemployment — admin @ 9:27 AM

In response to comments on a previous post on unemployment and jobs, MEPC wanted to take a closer look Mississippians that are looking for full-time work but that are not necessarily counted in the traditional unemployment rate. The following post walks through key parts of the underemployment rate, a broader measure of the portion of Mississippi’s workforce potentially encountering obstacles to full-time employment.

PUTTING ANNUAL UNDEREMPLOYMENT IN A HISTORICAL CONTEXT

Underemployment includes several key groups- the unemployed, discouraged workers who have temporarily given up looking for employment, marginally attached workers, and those that have taken a part-time job when they would prefer to be employed full-time.   In 2010, Mississippi’s underemployment rate reached 17.6% substantially higher than the traditional unemployment rate of 10.9%. Persistently high underemployment in 2009 and 2010 underscores the length and severity of this recession relative to others the state has experienced.  Even in during Mississippi’s last economic downturn in the early 2000s, annual underemployment registered well below the current levels (see chart).

DISCOURAGED WORKERS

A select portion of Mississippians want to work but have given up looking for employment because they perceive that opportunities are not currently available –called discouraged workers. Quarterly averages from the end of 2010 to the middle of 2011 report the traditional unemployment rate was 10.1%, but including discouraged workers pushed the rate upwards to 10.9%. The gap between total unemployed and unemployed + discouraged workers signals that 0.8% of Mississippi’s labor force has temporarily given up looking for work in the current economic environment.   The table below compares the most recent quarterly averages of four measures of labor utilization for the U.S. and Mississippi.

The persistence of underemployment across the state has impacted the economic security of many households. Some Mississippi workers have even temporarily given up looking for work. To connect more Mississippi workers with full-time employment, the nation and state will need to build investments in proven strategies for skill development of the state’s adults. Efforts like on-the-job training, apprenticeship programs and individual training accounts can be incorporated into sector-based strategies that connect employers with the skilled workforce they need and help bridge entry-level workers into employment.

Author: Sarah Welker, Policy Analyst

Fiscal Year 2011 State Budget Wrap Up

August 10, 2011

Filed under: Budget & Tax — admin @ 8:34 AM

Fiscal Year 2011 ended June 30 with revenues up slightly from estimates, but still struggling to recover from the recent recession.  General fund revenues, despite coming in above estimate were still down over $330 million from their peak in FY 2008.

Each year the revenue estimating group creates an estimate of revenue that is used to set the limit of appropriations by the legislature.  FY 2011 general fund revenues came in $114 over estimate.  It was the first year since FY 2007 that revenue did not come in under estimate.

While compared with the previous fiscal year, FY 2011 general fund revenues were $129 million higher than FY 2010, they are still well below pre-recession levels.  The figure below shows the state’s general fund estimates compared with actual collections from FY 2007 to FY 2011.

Mississippi General Fund Revenues Actual and Estimate FY 2007 to FY 2011

The reduction in general fun revenue from its peak in FY 2008 to FY 2012 of $330 million has resulted in repeated cuts to vital public services like education and health care with more cuts for many areas in store for FY 2012.  The affect of the cuts is even greater considering the increase in the costs of providing these services over the last five years as well.

The cuts only approach to dealing with the decline in state revenue has threatened the public structures that are the foundation of our economy. New revenue is necessary to maintain these structures are vital to the state’s recovery.

Author: Sara Miller, Senor Policy Analyst
Source: Mississippi Department of Revenue Monthly Report of Department of Revenue Transfers

 

FIVE FACTS ABOUT JOBS AND UNEMPLOYMENT

August 8, 2011

Filed under: Jobs,Unemployment — admin @ 11:15 AM

Friday’s job report indicated that employers across the nation added 117,000 jobs in the month of July, significantly more than June’s revised growth of 46,000 jobs. With the national jobs report in mind, what trends are seen in Mississippi’s economy? Today’s post highlights five facts on Mississippi’s current employment situation and provides data on changes to unemployment and jobs over the last year.

1) Mississippi added jobs from May to June.
Total non-farm employment grew modestly by 1,600 jobs from May to June, an improvement from reported job losses in the previous month.

2) Mississippi’s overall employment sees little change over the last year.
In June 2010, Mississippi’s overall employment locked in at 1,095,000 jobs. Reports from June of this year show almost no change in the overall number of jobs available, coming in with 500 fewer jobs at 1,094,500.

3) Changes in employment are not equal across all sectors of Mississippi’s economy.
While the overall number of jobs has not markedly changed, some sectors are experiencing growth. Trade, business services, health & education, and leisure & hospitality have all seen employment growth over the last year. In contrast, construction employment has seen very modest gains and manufacturing and government employment both have experienced considerable job losses over the last 12 months. In the last year, local and state government employment has been hit especially hard with a loss of 8,900 jobs.

4) 1 in 10 Mississippians continue to be unemployed and looking for work.
Over the last year, Mississippi’s unemployment rate has been above 10%. The state’s unemployment rate remains above pre-recession levels as many adults continue to encounter hardship in their search for employment.

5) Mississippi’s unemployment rate exceeds national and regional rates.
Mississippi’s unemployment rate of
10.3% in June remains above the rate of states in the South Central region and the nation. However, all three geographies continue to be impacted by unemployment levels well above rates from 2000 to 2007.


The employment numbers, once again, provide a strong case for a balanced approach that includes raising revenues, especially in light of the large number of jobs lost in the public sector.

Author: Sarah Welker, Policy Analyst

New Report Battles False Notions on Tax Flight

August 5, 2011

Filed under: Budget & Tax,Income & Working Families,Taxes — admin @ 10:41 AM


A new report from the Center on Budget and Policy Priorities takes on the myth that changes in income taxes affect migration of wealthy families to/from a state.   Often cited as a reason to cut taxes or to not to enact income tax increases, the migration myth is mostly based on anecdotes and/or a mis-read of migration and income data.

 

Some of the Center’s key findings . . .

Housing costs likely have a greater influence over migration than taxes.

A family might be able to cut its taxes by a few percentage points by moving from one state to another, but housing costs are far more variable. The difference between housing costs in two different states is often many times greater than the difference in taxes. So what might look like migration in search of lower taxes is really often migration for cheaper housing.

Other quality of life factors, which are enhanced by adequate state revenue collection, may also affect migration.

Studies show that such amenities as cultural facilities, recreational opportunities, and good public services are powerful attractions for potential migrants. Many of those services are financed with tax dollars. Therefore, while low taxes decrease the cost of living, they might also prevent states from preserving or improving valued public services, which would discourage potential migrants.

Studies using data that showed a reduction of high income households to demonstrate migration were actually seeing a decline in wealth due to the recession rather than out migration of wealthy families.

Critics of Maryland’s 2008 tax increase on income over $1 million point to the sharp decline that year in the number of filers in the state with taxable incomes exceeding $1 million as evidence that wealthy residents were fleeing the state. But an examination of actual tax return data shows that the vast majority of this decline occurred not because people moved out of the state, but because their incomes fell below the $1 million mark due to the recession and stock market crash; they remained on the tax rolls, but in a lower tax bracket.

The Bottom Line?

It is not as simple as saving a few percentage points on a tax bill.  People don not move away from their relatives, jobs and communities because of taxes. Job availability, housing prices, educational opportunities and even the weather weigh more heavily in the decision making process.

Mississippi should focus on maintaining adequate revenue to invest in education, public safety, transportation and other factors that make the state more attractive to new residents and improve the quality of life for those already raising families and operating businesses in the state.

 

Author: Sara Miller, Senior Policy Analyst
Image Credit: 24/7 Wall St.

Any Way you Slice It, Education in Mississippi Has Been Cut

August 2, 2011

Filed under: Budget & Tax,Education,Income & Working Families,Taxes — admin @ 1:17 PM

The recent state budget crisis has meant real cuts for state education.  Sometimes state budget numbers are hard to navigate with the different funding sources (general funds, special funds and federal funds) and different budget categories.   However, for education funding in Mississippi over the last four years, the conclusion is simple.  Any way you look at it, whether state general funds or total appropriations, whether just MAEP or total K-12 education, education appropriations have decreased.

The figure below shows education funding and the total budget in general funds and total appropriations from FY 2008 and FY 2012.

Mississippi Education Funding Comparison FY 2008 and FY 2012

Appropriations for the Mississippi Adequate Education Program (MAEP) which funds our K-12 schools have decreased in total by about 8% from FY 2008 to FY 2012.

Total public education funding includes MAEP, the Department of Education, the Educational Television Authority, and the Library Commission. Considering other funding sources (federal funds and other special funds), total appropriations has decreased over $80 million, or 3%.

General fund appropriations for MAEP and total Public Education have also been reduced by about 10%.  This is a higher percentage cut than the total general fund budget over the same time period.

These cuts have come at a time when a quality education system is even more vital to our state’s economy as the state struggles to recover from the recent recession. New revenue is necessary to restore the state’s gains in education and prepare the state’s future workforce for a new economy.

Author: Sara Miller, Senior Policy Analyst
Source: FY 2008 State of Mississippi Budget, Budget Summary 2011 Legislative Session