Page 9 - The Edge - Winter 2016

2015 LEGISLATIVE WORKSHOP

BY DON HARRIS

Jim Rounds: Education and Workforce Issues

Vital to Arizona’s Growing Economy

As Arizona climbs its way out of the Great Recession and positive It doesn’t have to be in manufacturing, but it darn well better be
steps are being taken to encourage economic development, education something. We’d better get creative going forward and gure out a
plays a key role in producing a competent and quality workforce. way of getting high value-added jobs back to the state.”
Jim Rounds, President of Rounds Consulting Group, provided Unlike previous recoveries, Arizona is not poised to experience
school representatives with an economist’s view of Arizona’s future, a boom. ere are some things the state can control and others
a snapshot of the nation’s well-being, and where public schools t in. that are not controllable. “For example, we can’t control the fact
He spoke at the 2015 Legislative Workshop on Nov. 13 sponsored that somebody has to wait years for a mortgage if they went thru
by the Arizona School Boards Association, the Arizona Association foreclose,” Rounds said. “We can’t control the fact that a lot of
of School Business O cials and the Arizona School Administrators students getting out of college are having massive amounts of debt.
association, and he expanded his observations in a subsequent And, if the U.S. economy is only going through moderate expansion,
interview. that dictates what our expansion will look like. All we can do is try
In a normal expansion period, Arizona is a Top 5 state in job to manage it.”
creation, and at a minimum in the Top 10, Rounds said. “But because Nationally, Rounds expects growth, but no economic boom.
of the nature of the recession and the nature of our economy, we’re “We’ll probably see a moderate to weak economy for the next couple
seeing weaker growth than what we saw in previous expansions,” he of years and then sharper growth in the next expansion,” he said. He
said. As a result, the federal Bureau of Labor Statistics ranked Arizona cautioned that another downturn is possible if, for example, the Dow
13th in job creation in September as compared to the corresponding Jones Average hits 20,000. “ at is a bubble waiting to burst.”
month in 2014. e top ve states were Utah, Washington, Florida, Rounds then cited things state leaders can control, like having
Oregon and Nevada. a competitive tax structure and responsible economic development
Not to worry. States are grouped tightly in terms of job growth and
it wouldn’t take much for Arizona to become a Top 10 state again. programs. “We can control having a solid marketing plan for the
state, not just for tourism but for business recruitment,” he said.
Even so, Rounds cautioned about rates of growth. “You’re going to It appears that the state is on the right track in those areas, he said,
see strong rates of growth in housing permits, but coming o such a adding, “One area I’d like to see the governor and the Legislature
low base, even growing by 10 or 15 percent doesn’t mean that much
anymore,” Rounds said. “And with construction employment, you focus on in the coming year is the extent that we grow small
will see strong growth rates just because of basic math. If we fall 50 businesses so that they become larger, powerful businesses down the
percent, we’ve got to double our current level or basically grow by road. In other words, we need to talk about how the state is going
100 percent to get back to where we were. Getting to normal will to grow the economy from within – not just by getting that next
require strong rates of growth.” company to come to Arizona.
By last September, Arizona had recovered 83 percent of the jobs “To grow from within means we need to be talking about
lost during the recession years, according to a federal report. “A lot workforce issues, more than we have in the past,” Rounds said. “We
of people are arguing that the Arizona economy is broken because have to do a better job of quantifying where we stand and how we
we haven’t recovered all those jobs,” Rounds said. “But we knew it improve.”
would take at least until 2015 because of the nature of the recession at’s where education plays a pivotal role. “What this means
and the nature of our economy. e real story is that it is taking for AASBO members is that growing from within is an important
about a year longer than expectations. at doesn’t sound so bad.” concept, which means that workforce issues are important concepts,
Weeks a er his presentation, Rounds said the state’s job recovery which means that education is an important concept,” Rounds said.
had jumped to 88 percent in November. He expects a full recovery When leaders talk about business development, they need to
in construction employment by the end of the decade, but he doesn’t talk about workforce training, Rounds said. “ e importance of
see Arizona recouping manufacturing jobs anytime soon. education issues to economic development is a valid topic,” he said.
“ e world has changed, and we saw weaknesses developing “If we keep hearing this more and more, it gives education groups
with a lot of jobs going overseas,” Rounds said. “Motorola jobs are additional seats at the table — and I think that’s great.”
disappearing and we’re adding jobs at Walmart at record paces.
We have shi ed from a manufacturing core that paid high wages. Jim Rounds can be reached at rounds@roundsconsulting.com or
We have to gure out a way of getting those high wage jobs back. (602) 739-0844.

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