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When it comes to jobs, Florida's more is less

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By ROBERT TRIGAUX, Times Business Columnist

© St. Petersburg Times
published October 20, 2002


Which is better for Florida? One new job that pays $50,000 a year? Or two new jobs, each paying $25,000?

This state insists it wants the former. But it usually ends up with the latter.

The tug-of-war of quality vs. quantity of new jobs in the Sunshine State is a long-running theme. But it is intensifying rapidly with growing evidence that Floridians' paychecks, on average, are falling further and further behind those of workers elsewhere in the country, especially in other major states.

Case in point: In the years 1996-98, the median household income in Florida was $33,234. That was 88 percent -- $4,545 less -- of the national median household income. But in the three-year span of 1999 to 2001, Floridian's median household income was $36,421. That's 86 percent -- $5,807 less -- of the the nation's median household income.

The bottom line? Overall, Florida household incomes are falling further behind the growth of the country's. The same holds true when Florida income is compared with those in other high-population states such as California and Texas, or southeastern rivals Georgia and North Carolina. In each case, the gap is widening steadily between their higher and Florida's lower income.

The slippage is hardly intentional. Call it long-term, benign neglect. But the erosion is steady. State leaders, economic development groups and countless chambers of commerce in Florida say they are going all out to promote and attract higher-paying jobs.

Better jobs also happens to be a hot topic of debate in Florida's race for governor, which is shaping up to be a close contest between incumbent Jeb Bush and political newcomer Bill McBride . Voters will decide Nov. 5.

On the campaign trail, Bush frequently points out that, on his watch, Florida continues to generate new jobs when most states are losing them. Here's how he framed the issue during the televised debate with McBride in September.

"We said we needed to grow jobs, and that's why we've cut taxes and improved regulation and streamlined our workforce programs," Bush said. "Six hundred thousand new jobs have been created in the last four years. And Florida leads the nation in job growth."

That's all true, as far as it goes. Florida remains remarkably consistent in generating new jobs. In fact, it's created on average more than 200,000 jobs a year in 16 of the past 20 years (in four recession years, job growth was flat), according to the U.S. Bureau of Labor Statistics.

That steady pace since at least 1982 suggests Florida's new jobs are influenced more by continued immigration of people and natural market forces than by any state financial incentives or political leadership -- Republican or Democrat.

McBride, in the same televised debate and in other remarks, says Bush makes too much of job growth and too little of job quality. "We have one of the lowest wages in the nation," he told the TV debate audience. "We have a crisis, and he seems to ignore it, saying things are fine."

McBride's principal, if vague, solution for better Florida jobs is to improve the quality of public education and graduation rates. That, in turn, will create better trained workers and attract higher-paying jobs.

Who's right? Both camps scramble to find the selective data that suit their positions. The Florida Chamber of Commerce, hardly a Bush-bashing organization, has published a series of substantial "Cornerstone" reports on the state of the economy that clearly warns of Florida's flagging wages.

In reality, the Bush and McBride recommendations for upgrading Florida jobs are not all that far apart. Just remember: Every idea and incentive program adopted in Florida to spur better-paying jobs is essentially duplicated in competing states.

Any change will come slowly. At a minimum, Florida needs to break the dangerous trend of losing ground on wages to other states.

One reason why Florida's wage woes are not setting off alarms is that the state enjoys a healthy influx of new residents. That has let Florida brag for years about new jobs, without worrying about their low pay.

Don't assume people will always pour into Florida, says Orlando economist David Scott, who heads the Dr. Phillips Institute for the Study of American Business Activity at the University of Central Florida. If Florida's median household income gets too low compared with other states, the state will eventually lose its allure.

"The implication is, if wages stall and there are fewer better jobs, then you remain as you are," Scott says. "People would cease to move here because there would be no need for their skills."

Tourism may be one of Florida's big economic drivers. But it's also one of Florida's banes.

"Hotels employ a lot of people changing sheets, God bless them, but they don't employ many workers making $50,000 a year," Scott says. "Each new hotel drags down the average wage rate. As long as tourism grows faster than other industries, we will have a downward movement in wage rates."

So pause a moment before you cheer the opening of the next theme park. As long as chilled Northerners migrate to the palm trees of Florida, this state will take the easy way to expand its economy.

Pointing to such income data, the McBride campaign insists Bush has done little to foster economic development in Florida.

Some of the comparisons between Florida and other states are distressing:

* Florida's average wage was only 80 percent that of California in 1997. By 2000, Florida's wage fell to 75 percent.

* Florida's average wage was 91 percent that of Texas in 1997. By 2000, it fell to 88 percent.

* Florida's average wage was an impressive 101 percent (Floridians earned more) than that of North Carolina in 1997. By 2000, Florida fell to 99 percent.

* Florida's average wage was 93 percent that of Georgia in 1997. By 2000, Florida fell to 90 percent.

Pam Dana, Bush's bullish director of economic development in Tallahassee, sees Florida's economy not as half empty, but half full and filling rapidly. She cites the high marks Florida's "business climate" receives in surveys for its modest corporate taxes. She credits the state's "efficient infrastructure" as well as its lack of red tape, which she calls its "nonregulatory environment, one that is not sue happy."

Dana also cites the success of state financial incentives. These are offered by the Bush administration selectively to out-of-state companies with higher-paying jobs that are relocating to the Sunshine State, or to existing key companies that need encouragement to stay or expand here.

Who's benefited from such recent incentives? In the Tampa Bay area, J.P Morgan Chase received several incentive packages for its various back-office and clearing operations. So did Capital One Auto Finance, Merck-Medco and Household International. Other area recipients include R.P. Scherer, United Healthcare, Raymond James Financial and Ocean Optics.

Bush also recently established a $30-million technology initiative to create "centers of excellence" at some of the state's universities. Details are still being fleshed out. And Enterprise Florida, the state's economic development arm, last week unveiled a $1.45-million ad campaign showcasing the state as the "Innovation Hub of the Americas."

The question is: Can Florida economic development leaders make the leap from a glitzy marketing campaign to the nitty-gritty commitment needed to attract and nurture real tech businesses?

Never look too far behind the facade. Florida leaders tend to approach the complex nurturing of specialized high-tech businesses as they would hype the expansion of an Orlando theme park. Throw some glitzy advertising out there, and they will come.

While the Florida media reported on the new state ad campaign, they glossed over last week's dismal failure of a Florida city -- Jacksonville -- and the state to compete against Georgia and South Carolina for a DaimlerChrysler plant to build vans. The plant would have employed 3,000 people, paid them between $45,000 and $50,000 a year and generated thousands more jobs from suppliers and other service providers.

Now that would have been a real economic coup and signaled Florida truly is serious about climbing the payscale ladder.

Florida's sheer size and, yes, its ingrained suntan mentality mean it will take a lot of resources and time to change its lower-wage economy. In their hearts, both Bush and McBride realize there's only so much they can do over the course of several years in office.

"The political arguments and policies have been rather irrelevant to the bigger things that affect growth in Florida," economist Scott says.

For a long time, Florida has broadcast a message heard by many Americans. This is the place to come if you're out of work and need a quick job that requires little training.

How long could it take a theme park to teach a new worker to say: "Hi. This is a tram. Watch your step. Have a nice day."

-- Robert Trigaux can be reached at trigaux@sptimes.com or (727) 893-8405.

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