Daniel P. Mehan
Editor's note: The Missouri General Assembly convened last week with ethics reform and budget shortfalls dominating discussions.After withstanding a historic recession for more than a year, some of the more telling economic indicators show signs of recovery.
While labor numbers continue to fluctuate, we no longer see dramatic layoffs each month. Likewise, the investment markets are rebounding following heavy losses earlier this year. With Missouri and federal unemployment rates still lingering near 10 percent, the overall picture remains far from rosy for many Missouri families. But, if the indicators are accurate, what we are seeing now is an economy that has bottomed out and is readying to grow.
You could say that right now, Missouri's economy, like the rest of the nation, is as precarious as a tightrope. That makes Missouri lawmakers' jobs a balancing act in 2010, weighing massive budget shortfalls against the need to invest in job creation.
Missouri can become one of the nation's top go-to places for business investment. And there are reasons to believe this is possible. Missouri's state taxes are relatively low compared to elsewhere, our cost of living is among the lowest, property and labor are affordable here, current energy prices are below average and our economy has shown to be far more stable than that of many states.
Several of these benefits to doing business in Missouri can be traced back to decisions made by our legislative leaders who have guided our state's budget during the last several years. These lawmakers have walked the tight rope during the appropriations process, avoiding sweeping budget cuts and the pit of higher taxes. This year, they will be required to cross a far more daunting revenue gap - and we trust again that they will stay guarded against tax and fee increases and debilitating cuts that will only make it harder for businesses to expand and add jobs.
But while our state's leaders have kept us on more stable footing than most, Missouri must realize that it exists in a competitive marketplace, where we are one of 50 states fighting for investment - not only with each other but with dozens of foreign nations. We need to stand out as a major attractor of the kinds of high-tech jobs that will help our state be successful in the future.
Toward this goal, there is tremendous potential in the proposed Missouri Science and Innovation Reinvestment Act. This legislation would help generate momentum for investment in Missouri and reward existing high-tech companies that choose to expand in our state. The reinvestment act also would create a stable revenue source - without raising taxes - for investing in the infrastructure and training needed to transition our economy.
In addition, there are other steps the state can take to help accelerate Missouri's growth. For example, enacting legislation designed to make Missouri a more desirable location for data centers would help put the state on par with its neighbors as well as leverage some of our state's natural assets that make it a prime location for this kind of new-economy business.
Even in the face of tight budgets, the state also must continue to support specific projects that promise potentially transformative growth. Perhaps the best example of this is the Midwest/China Hub project that is gaining steam in St. Louis. It's clear that directly linking our state to the world's fastest growing economy holds enormous potential that we simply cannot let slip by due to temporary budget issues.
Along with this opportunity, there are threats that will need to be addressed and overcome.
Missouri employers will soon find themselves grappling with billions of dollars in unemployment insurance debt that spiraled beyond expectations as more Missouri workers lost their jobs and increased benefits were added by the federal government. The challenge is quickly becoming how the state's employers can address the debt without choking economic growth.
Another open question is how the state will deal with a Second Injury Fund that is facing insolvency. Now is not the time to ask employers to increase their funding of a system that needs significant changes. These two issues need serious thought and both short-term and long-term answers.
As Missouri lawmakers ready themselves to walk the tight rope of the 2010 legislative session, Missouri's employer community stands behind them in their efforts. Although some difficult hurdles will arise, it should not obscure the potential opportunities that exist for moving our economy and business climate forward.
Daniel P. Mehan is president and CEO of Jefferson City-based Missouri Chamber of Commerce and Industry, which represents more than 3,000 employers that employ more than 425,000 Missourians. He can be reached at dmehan@mochamber.com.
