News Analysis: A layman’s journey through Oklahoma’s right-to-work data
Published: December 12th, 2012
OKLAHOMA CITY – More than a decade after Oklahoma voters enacted a right-to-work measure, pundits and partisans continue to debate whether or not right-to-work has delivered on all or even most of its promises.
Early this year, Oklahoma was an exhibit for right-to-work proponents in Indiana. This month, it is an exhibit for proponents in Michigan.
Advocates for what they deemed worker liberty won the political battle on September 25, 2001, when Oklahomans approved a right-to-work constitutional amendment. Millions of dollars were spent for and against the proposal, with unions and their allies enjoying a notable – but in the end not sufficient – spending advantage .
Politically, that popular vote ended the most important ballot issue campaign in modern state history. The debate over the economic efficacy of right to work will likely never end, but some facts are undeniable.
Here is a walk through the data.
Surveying the cumulative good news in Oklahoma since passage of right to work — including the state’s per capita personal income rank — among the six states on the national “spine” (North Dakota, South Dakota, Nebraska, Kansas, Texas and Oklahoma), personal income growth went from last in 2001 to second in 2011.
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 era.
Some critical studies of the impact of right to work ignore trends and look at long chunks of time — i.e. the last 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. But such analysis ignores income growth trends of the last decade or more, patterns which point to stronger income growth for right-to-work states like 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 last three years, the Sooner State continued a slow advance in this ranking; 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 over a 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 for the state, Jennifer Monies, press liaison for the Oklahoma State Chamber of Commerce, stresses 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 or “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 the city similarly.
The latest unemployment numbers put the jobless ranks 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 the manufacturing sector, Oklahoma has suffered just like the rest of the country in the numbers category, but even in this area there is leavening of the data.
A year ago, the state briefly led the national surge in manufacturing employment growth.
Writing for the Oklahoma Council of Public Affairs (OCPA), Scott Moody and Wendy Warcholik slap at the left-leaning Economic Policy Institute for ignoring productivity increases that have helped retain a comparatively robust manufacturing presence in the state, even as job numbers overall tightened.
Looking ahead, the future seems bright. 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 recently, since 2009, right to work states have created four times as many jobs as states where forced unionism is the norm. Oklahoma fits solidly in the midst of that picture.
A case can be made from the data that 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 in Oklahoma and contributing to a net increase in migration to the state 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,” an unfolding historical drama that lends perspective, even to the battle over right to work.
You may contact Patrick B. McGuigan at Patrick@capitolbeatok.com and follow us on Twitter: @capitolbeatok.