Interesting piece here. All of the unanalyzed data and thus the conventional wisdom suggests that red states have greater job creation than blue states. Certainly Ron DeSantis and Greg Abbott love to promote this talking point. But that’s not actually true. It’s just that jobs in red states suck so people quit them all the time, thus making it look like there is more hiring.
And faster hiring doesn’t indicate a more dynamic economy. A new analysis from the Economic Innovation Group found a healthy red-blue mix among the most- and least-dynamic state economies. EIG, a bipartisan D.C. outfit that churns out data-driven research and policy proposals, measured dynamism based on patenting, business start-ups, housing permits and other factors, few of which had any relationship to the pace of hiring.
Bewildered, we called Nick Bunker, economic research director at the job site Indeed. Bunker is the world’s second-most-prominent fan of job-opening and hiring data, behind only Treasury Secretary Janet L. Yellen, and he had a ready explanation for the seeming disconnect.
“It’s churn,” he said. Those red states weren’t creating jobs faster. They were just hiring more often because folks were bouncing around more. Red states don’t have more layoffs or job openings than blue ones, they just have more quits and hires.
As Bunker points out, quits and hires track each other closely. They both reflect how fast businesses churn through workers. When you combine quits and layoffs, then chart them against hires, you can’t tell the two lines apart.
It’s also why the ever-genial Bunker becomes uncharacteristically agitated when he discusses the “Great Resignation.” Yes, everybody was quitting, but they weren’t giving up. They were getting rehired elsewhere.
When we ran the numbers using the Bureau of Labor Statistics biennial job-tenure survey, we quickly verified that red states see more job-hopping than blue ones.
This is a piece with a lot of value and I am glad to see the Post publish it. My only caveat is why it took until May 2023 for any major publication to publish anything pushing back on these false narratives.