Comparing Perry’s Texas to Romney’s Massachusetts

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Republican primary front-runners Rick Perry and Mitt Romney are each basing a large part of their campaigns on their economic track records. So who is better when it comes to jobs and the economy — Romney or Perry?

Let’s put each of their states under the microscope to see what the data says. In this exercise we will use Analyst, EMSI’s web-based labor market analysis tool, to help us see the ins and outs of the Massachusetts and Texas economies.

Notes:

1. All data, graphs, and tables are from Analyst’s 2011.3 dataset, which is based on BLS, Census, BEA, and nearly 80 other sources.

2. As an economics firm we want to stress this point — businesses and economic activity create jobs, not politicians.

3. Gov. Perry (2000-current) and Romney (Massachusetts Governor from 2003-2007) do not have perfectly overlapping times in office, so we are going to consider the 10-year time frame and then look at how the states have performed during the recession, which would tend to reflect the legacy of each politician (e.g., politicians always inherit the blessings or curses of the previous administration).

4. Performance during the recession is the key point of data we want to look at. Which state is strong when tough times arise?

TEN-YEAR TRENDS

Right off the bat we see that the Texas economy is the clear leader. The state grew by 18%, or about 2.2 million jobs, in the last 10 years. Over that same time period Massachusetts grew by 2%, or less than 100,000 jobs.

(click images to enlarge)

 

Almost every industry sector in Texas grew from 2001 to 2011. Agriculture, information, and manufacturing were the only ones to actually decline. The big leaders were health care (43% growth, 421,000 jobs), government (17% growth, 282,000 jobs), oil and gas (111% growth, 257,000 jobs), finance and insurance (38% growth, 216,000 jobs), and professional and technical services (29% growth, 210,000 jobs).

NAICS Code Description 2001 Jobs 2011 Jobs Change % Change 2011 Earnings
62 Health Care and Social Assistance 985,667 1,407,160 421,493 43% $49,118
90 Government 1,679,431 1,961,341 281,910 17% $59,455
21 Mining, Quarrying, and Oil and Gas Extraction 231,809 488,494 256,685 111% $136,302
52 Finance and Insurance 575,109 791,054 215,945 38% $69,091
54 Professional, Scientific, and Technical Services 713,722 923,621 209,899 29% $74,784
72 Accommodation and Food Services 789,913 987,746 197,833 25% $19,814
56 Administrative and Support and Waste Management and Remediation Services 744,446 932,960 188,514 25% $33,979
53 Real Estate and Rental and Leasing 410,363 559,112 148,749 36% $31,946
81 Other Services (except Public Administration) 592,116 708,981 116,865 20% $28,597
23 Construction 849,097 950,903 101,806 12% $54,438
61 Educational Services 148,927 214,526 65,599 44% $36,378
55 Management of Companies and Enterprises 41,840 105,073 63,233 151% $102,137
71 Arts, Entertainment, and Recreation 171,298 230,177 58,879 34% $24,422
44-45 Retail Trade 1,350,407 1,400,681 50,274 4% $30,803
48-49 Transportation and Warehousing 506,512 553,486 46,974 9% $60,395
42 Wholesale Trade 508,024 552,876 44,852 9% $80,704
22 Utilities 52,813 55,870 3,057 6% $118,804
11 Agriculture, Forestry, Fishing and Hunting 345,303 319,410 (25,893) (7%) $20,912
51 Information 299,481 227,513 (71,968) (24%) $73,610
31-33 Manufacturing 1,066,622 871,533 (195,089) (18%) $79,460
Total 12,062,901 14,242,517 2,179,616 18% $53,493
Source: EMSI Complete Employment - 2011.3


Massachusetts’ growth sprung primarily from health care (24% growth, 111,000 jobs), professional and technical services (10% growth, 37,000 jobs), educational services  (19% growth, 35,000 jobs), and real estate (27% growth, 34,000 jobs). A big thing to note is that nine industry sectors — utilities, government, transportation, retail trade, management of companies, wholesale trade, information, construction, and manufacturing — lost jobs from 2001-2011.

NAICS Code Description 2001 Jobs 2011 Jobs Change % Change 2011 Earnings
62 Health Care and Social Assistance 468,668 579,523 110,855 24% $60,616
54 Professional, Scientific, and Technical Services 363,592 400,919 37,327 10% $96,534
61 Educational Services 184,644 220,002 35,358 19% $56,621
53 Real Estate and Rental and Leasing 125,313 159,096 33,783 27% $32,018
72 Accommodation and Food Services 249,024 277,782 28,758 12% $22,995
81 Other Services (except Public Administration) 179,165 203,904 24,739 14% $33,199
71 Arts, Entertainment, and Recreation 84,064 105,900 21,836 26% $28,814
52 Finance and Insurance 232,356 253,578 21,222 9% $115,262
56 Administrative and Support and Waste Management and Remediation Services 212,872 213,893 1,021 0% $39,572
21 Mining, Quarrying, and Oil and Gas Extraction 2,604 3,398 794 30% $148,741
11 Agriculture, Forestry, Fishing and Hunting 20,552 20,373 (179) (1%) $33,359
22 Utilities 12,332 11,383 (949) (8%) $135,669
90 Government 432,156 426,859 (5,297) (1%) $66,827
48-49 Transportation and Warehousing 124,887 111,495 (13,392) (11%) $52,693
44-45 Retail Trade 406,859 393,365 (13,494) (3%) $32,842
55 Management of Companies and Enterprises 72,884 58,796 (14,088) (19%) $125,760
42 Wholesale Trade 150,660 134,602 (16,058) (11%) $91,749
51 Information 122,543 100,471 (22,072) (18%) $100,676
23 Construction 219,882 195,324 (24,558) (11%) $66,726
31-33 Manufacturing 398,839 264,887 (133,952) (34%) $94,358
Total 4,063,896 4,135,549 71,653 2% $63,647
Source: EMSI Complete Employment - 2011.3


Since much of the discussion in the Republican primary has to do with the nation’s more recent economic turmoil, let’s refocus our analysis to 2007 – 2011.

MASSACHUSETTS FACTS

The current population of Massachusetts is 6.6 million with 4.1 million jobs. The unemployment rate is 7.6%, and average earnings in the state are more than $63,000 per year. The gross regional product (GRP), which is the value of all goods and services produced in a region by all industries, is $378 billion per year.

In Massachusetts, nearly 80% of the population is White, Non-Hispanic. The age demographics tell us the state is pretty balanced, and educational attainment is high.


Massachusetts ’07-11

From 2007-2011, jobs declined by 1% (overall loss of 34,000). All things considered — not bad. The biggest losses were felt in construction and manufacturing (total losses of 82,000 jobs). The biggest gains were in health care (45,000 jobs), educational services (11,000 jobs), professional and technical (11,000 jobs), and accommodation and food services (10,000 jobs).

NAICS Code Description 2007 Jobs 2011 Jobs Change % Change 2011 Earnings
62 Health Care and Social Assistance 534,634 579,523 44,889 8% $60,616
61 Educational Services 209,184 220,002 10,818 5% $56,621
54 Professional, Scientific, and Technical Services 390,170 400,919 10,749 3% $96,534
72 Accommodation and Food Services 267,731 277,782 10,051 4% $22,995
52 Finance and Insurance 245,717 253,578 7,861 3% $115,262
81 Other Services (except Public Administration) 196,358 203,904 7,546 4% $33,199
71 Arts, Entertainment, and Recreation 98,450 105,900 7,450 8% $28,814
22 Utilities 10,653 11,383 730 7% $135,669
21 Mining, Quarrying, and Oil and Gas Extraction 2,854 3,398 544 19% $148,741
11 Agriculture, Forestry, Fishing and Hunting 19,934 20,373 439 2% $33,359
51 Information 100,643 100,471 (172) 0% $100,676
90 Government 427,688 426,859 (829) 0% $66,827
53 Real Estate and Rental and Leasing 162,635 159,096 (3,539) (2%) $32,018
55 Management of Companies and Enterprises 62,367 58,796 (3,571) (6%) $125,760
48-49 Transportation and Warehousing 116,671 111,495 (5,176) (4%) $52,693
44-45 Retail Trade 404,423 393,365 (11,058) (3%) $32,842
42 Wholesale Trade 148,614 134,602 (14,012) (9%) $91,749
56 Administrative and Support and Waste Management and Remediation Services 227,964 213,893 (14,071) (6%) $39,572
23 Construction 236,308 195,324 (40,984) (17%) $66,726
31-33 Manufacturing 306,523 264,887 (41,636) (14%) $94,358
Total 4,169,521 4,135,549 (33,972) (1%) $63,647
Source: EMSI Complete Employment - 2011.3


Also, here is a view of 6-digit (NAICS) industries that grew and declined from 2007-11. In the table above we looked only at 2-digit NAICS. When we use the 6-digit sectors we can see much more specific industry detail. Portfolio management was the highest growing industry from 2007-11 in Massachusetts.


Here is a list of occupations that grew and declined from ’07-11. These are 5-digit occupations (SOC codes). Consistent with the industry data, the fastest-growing occupation is personal financial advisors.


TEXAS FACTS

Texas has a total population of 25.6 million with 14.2 million jobs. The average earnings is $53.5K per year, and the unemployment is 972,000. The unemployment rate is 8.4%, which is a tad higher than Massachusetts’. The state’s GRP is $1.2 trillion per year.


In terms of demographics, Texas is 46% White, Non-Hispanic, 36% Hispanic, and 11% Black or African American. Educational attainment is lower than Massachusetts. Texas also appears to have a slightly younger population when compared to Massachusetts.


Texas ’07-11

From 2007-2011, the Texas economy grew by 3% (391,000 jobs gained overall). The state had huge job gains in oil and gas extraction (56% growth and 175,000 jobs), health care (14% growth and 171,000 jobs), and government (7% growth and 125,000 jobs). Other sectors like finance and insurance, accommodation and food, professional and technical, and educational services all had decent gains. Losses occurred in construction and manufacturing (about 192,000 jobs), retail trade (41,000 jobs or -3%), information (35,000 jobs or -13%), transportation (24,000 jobs or – 4%) and wholesale trade (13,000 jobs or -2%).

NAICS Code Description 2007 Jobs 2011 Jobs Change % Change 2011 Earnings
21 Mining, Quarrying, and Oil and Gas Extraction 313,502 488,494 174,992 56% $136,302
62 Health Care and Social Assistance 1,235,840 1,407,160 171,320 14% $49,118
90 Government 1,836,081 1,961,341 125,260 7% $59,455
52 Finance and Insurance 717,799 791,054 73,255 10% $69,091
72 Accommodation and Food Services 943,336 987,746 44,410 5% $19,814
54 Professional, Scientific, and Technical Services 892,977 923,621 30,644 3% $74,784
61 Educational Services 192,643 214,526 21,883 11% $36,378
55 Management of Companies and Enterprises 83,783 105,073 21,290 25% $102,137
81 Other Services (except Public Administration) 689,944 708,981 19,037 3% $28,597
71 Arts, Entertainment, and Recreation 215,084 230,177 15,093 7% $24,422
22 Utilities 50,935 55,870 4,935 10% $118,804
11 Agriculture, Forestry, Fishing and Hunting 317,762 319,410 1,648 1% $20,912
56 Administrative and Support and Waste Management and Remediation Services 934,474 932,960 (1,514) 0% $33,979
53 Real Estate and Rental and Leasing 564,471 559,112 (5,359) (1%) $31,946
42 Wholesale Trade 565,616 552,876 (12,740) (2%) $80,704
48-49 Transportation and Warehousing 577,467 553,486 (23,981) (4%) $60,395
51 Information 262,342 227,513 (34,829) (13%) $73,610
44-45 Retail Trade 1,441,632 1,400,681 (40,951) (3%) $30,803
23 Construction 1,025,977 950,903 (75,074) (7%) $54,438
31-33 Manufacturing 989,430 871,533 (117,897) (12%) $79,460
Total 13,851,095 14,242,517 391,422 3% $53,493
Source: EMSI Complete Employment - 2011.3


Here is a look at 6-digit industries and 5-digit occupations that grew and declined at the largest clip in Texas from ’07-11. As you can see, oil and natural gas extraction is a very big driver for the state. Under Perry, the state also picked up quite a few local government jobs during the recession.



CONCLUSION

Based on job numbers, both candidates do have legitimate claims that their states have done well through the recession. In this comparison — Texas really benefits from the huge grow within oil and natural gas. See this recent interactive display to better visualize this trend.

When looking at data like this, it is important to keep in mind that the economies of states (and these two states in particular) are quite different in terms of total population, demographics, and industry composition. Both states have some strong qualities, but based on raw numbers, Texas is the obvious choice.

Rob Sentz is the marketing director at EMSI, an Idaho-based economics firm that provides data and analysis to workforce boards, economic development agencies, higher education institutions and the private sector. He is the author of a series of green jobs white papers. Email Rob with questions at rob@economicmodeling.com.

Lead illustration by Mark Beauchamp



















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