In The News

Creating Inspector General’s Office in Delaware becomes bipartisan effort

From: Bay to Bay News

DOVER — A push to create a watchdog Inspector General’s Office took a significant step forward as Democratic and Republican lawmakers continued to unite Wednesday.

State Rep. Mike Smith, a Newark Republican, signed on to be co-prime sponsor with Rep. John Kowalko, a Newark Democrat, on House Bill 405, ending his own bid to do the same through proposed legislation. Multiple members of both parties support the bill and Rep. Kowalko said he’s heard no opposition to it.

“I think (Rep. Smith’s) addition sends a signal that both parties are interested in one thing and that is honest, transparent government, which in turn, will promote good government, right,” he said Wednesday.

“That’s what the public wants. It’s what the public deserves.”

In a statement, Rep. Smith said that “Good government and transparency are at the heart of the public’s interest.

“Those are not partisan ideals so I’m glad to be joining efforts with Rep. Kowalko and thank him for his partnership to support a more efficient, effective, open and transparent government and to make our state government more accountable to every constituent up and down the state.”

The proposed legislation, which awaits discussion in the House Administration Committee, would:

• Investigate the management and operation of state agencies to determine if there has been waste, fraud, abuse, mismanagement, corruption, or other conduct that is harmful to the public interest.

• Coordinate with other agencies, recommend corrective actions and statutory revisions, and, if necessary, make referrals to law enforcement.

• Provide reports to the governor, attorney general and General Assembly, and these reports will be available to the public on the OIG website.

Rep. Kowalko gave credit to Delaware Coalition for Open Government’s Nick Wasileski for, among other contributions, gathering information from other states and their Inspector General’s Offices.

Mr. Wasileski credited coalition members for their work as well, noting “We’ve been raising awareness for the need of an inspector general for more than three years.”

According to Mr. Wasileski, DelCOG felt “it would be very important to include mismanagement and neglect of office because a lot of times things that occur in the state may not rise to the level of a crime, but they do harm Delawareans.”

Utah tops economic competitiveness report again

From: The Center Square

Utah tops the American Legislative Exchange Council’s (ALEC) list of the country’s most competitive states for the 15th year in a row.

 The annual report bases its rankings on 15 factors including the state’s tax burden, legal system, minimum wage, size of government and public debt.

“Utah has a strong track record of pro-taxpayer reforms in recent years, including the adoption of a flat personal income tax rate, pension reform for its previously endangered system, and the state’s innovative approach to property tax reform,” the authors wrote.

The state ranked second for economic performance.

The review showed over 97,000 people have moved to Utah between 2011 and 2020. The most significant uptick in migration took place between 2016 and 2020.

“Americans continue to vote with their feet toward states that have lower tax burdens and value economic competitiveness,” said Jonathan Williams, ALEC chief economist and one of the authors of the review.

Utah’s top marginal personal and corporate income tax rate, which represented any local taxes and impact of federal deductibility, was 4.9%. Its personal income tax progressivity, which is the change in tax liability per $1,000 of income, was $0.32 and ranked 12th.

Utah lawmakers enacted several pro-taxpayer reforms in the past few years including a flat rate income tax.

“If you believe incentives matter, and I do, state policies have the effect of changing those incentives at both the state and local levels,” said Dr. Arthur Laffer, a co-author of the report. “Those changes in incentives have consequences.”

The state’s property tax burden per $1,000 of personal income was $24.31, which was 14th overall. The sales tax burden, also per $1,000 of personal income, was $25.18, and the remaining tax burden was $16.10 per $1,000 of income, according to the report.

Utah does not levy an estate or inheritance tax.

The state’s tax expenditure limit, which measures the influence of tax and expenditure limits on state tax revenue and spending, ranked 15th.

Overall, the review showed the most significant ways states succeed in attracting new residents are cutting taxes, paying down debt and maintaining free market policies, according to the report.

“This study has had a big impact on what state officials, governors and legislators are doing,” said Stephen Moore, one of three authors of the report. “This is a magic moment for tax reform at the state level. I think even in some of these blue states that have been traditionally very liberal, they’re looking at reforms that could really make their states more prosperous. I think the direction is good, and I think a lot of that direction is a result of the Rich State, Poor State rankings.

Other states that made the top five were North Carolina, Arizona, Oklahoma, and Idaho. At the bottom were Minnesota, Vermont, California, New Jersey, and New York.

Drug Use by State: 2022’s Problem Areas

From: Wallet Hub

Drug abuse has a long and storied history in the United States, and we’ve been “at war” with it since 1971 under the Nixon administration. Yet despite the country’s best efforts to fight it, the problem is getting worse, and is exacerbated by the COVID-19 pandemic. There were over 100,000 drug overdose deaths in the 12-month period ending in April 2021, up 28.5% from the previous year. It’s crucial for the government to address this issue and prevent it from getting any worse.

Given the uncertain future and lack of significant progress to date, it’s fair to wonder where drug abuse is most pronounced and which areas are most at risk. This report attempts to answer those questions by comparing the 50 states and the District of Columbia across 21 key metrics, ranging from arrest and overdose rates to opioid prescriptions and employee drug testing laws.

Highest Drug Use by State

Some missing workers are really lost

From: Richmond County Daily Journal

North Carolina’s labor markets are healing — slowly. As of March, our state’s headline unemployment rate was 3.5%, comparable to where it was before the onset of the COVID-19 pandemic in early 2020. More importantly, while our labor-force participation is still significantly below the pre-COVID rate 59.2%, it is improving. It was 57.7% in March, up from 56.2% a year ago.

That’s important because the headline unemployment rate, technically known as the U-3 rate, only counts as unemployed those working-age individuals who are jobless but actively looking for work. Unfortunately, there are many thousands of working-age North Carolinians without jobs who aren’t counted in the U-3 rate.

Given the labor shortages currently afflicting industries as divergent as retail, construction, dining, and business services, why do so many potential employees remain on the sidelines?

I’ve written about this issue many times in the past. Businesses are desperately seeking help. That employer demand has, in turn, pushed up wages (although price inflation has eaten away some of the apparent gain). And the expanded unemployment-insurance benefits and other subsidies that discouraged some workers from taking new jobs or returning to old ones have expired. Given these and other pro-employment factors, then, why do we have so many missing workers?

A new National Bureau of Economic Research working paper suggests that I and other analysts should have phrased the question a bit differently. Some of these prospective workers aren’t missing. They’re lost.

That is to say, these folks aren’t simply missing from our statistical models. They are physically and psychologically lost, suffering from addictions so debilitating that they lack either the will or the capability to fill vacant jobs.

The prevalence of opioids, while significant, is only part of the story. Comprehensive data on post-pandemic drug and alcohol abuse are not yet available, but the three economists who authored the new paper — Jeremy Greenwood from the University of Pennsylvania, Nezih Guner from the Universitat Autonoma de Barcelona, and Karen Kopecky from the Atlanta Fed — observed that deaths attributed to substance abuse spiked far above preexisting trend lines during the pandemic. Based on these “excessive death” statistics, they were able to extrapolate likely increases in the broader universe of addicts and substance abusers.

Take opioids. From April 2020 to June 2021, some 69,000 Americans died from overdoses or other causes related to opioid abuse. That’s nearly 15,000 more than we might have expected given prior trends. Using ratios developed from other studies, the authors estimated that there were about two million more Americans abusing opioids during this period than would have done so in the absence of the COVID pandemic and the economic dislocations and social isolation that followed. The researchers estimated an even larger increase in alcohol abusers. For all drugs combined, Americans with substance-abuse disorders may well have jumped by more than five million, an increase of 23%.

That’s gigantic. And it couldn’t have happened without wreaking havoc on, among other things, our labor markets. The study’s authors concluded that higher rates of substance abuse among the working-age population can account as much as a quarter of the drop in labor-force participation.

Alas, remedying the problem is far easier said than done. I don’t think further criminalizing it is the right approach. After all, most of the addicts in question are abusing a perfectly legal drug, alcohol, or misusing legal but controlled substances such as opioids. I doubt seriously that passing sweeping new prohibitions or access controls will make enough of a difference to justify the cost in tax dollars, law-enforcement resources, and freedoms. As for drug treatment, program effectiveness varies wildly. My reading of the evidence suggests that truly local programs, often rooted in shared religious faith or community values, produce the best results. They can also be hard to scale.

Still, while substance abusers may be, in a sense, “lost,” that doesn’t mean they can’t be found. All of us, individually and collectively, must be willing to join the search party.

Hawaii ranks near bottom of report on COVID-19 policy effects

From: The Center Square 

Unemployment Insurance Weekly Claims

By Delaware Department of Labor

In the week ending April 30, the advance figure for seasonally adjusted initial claims was 200,000, an increase of 19,000 from the previous week’s revised level. The previous week’s level was revised up by 1,000 from 180,000 to 181,000. The 4-week moving average was 188,000, an increase of 8,000 from the previous week’s revised average. The previous week’s average was revised up by 250 from 179,750 to 180,000.

The advance seasonally adjusted insured unemployment rate was 1.0 percent for the week ending April 23, unchanged from the previous week’s unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending April 23 was 1,384,000, a decrease of 19,000 from the previous week’s revised level. This is the lowest level for insured unemployment since January 17, 1970 when it was 1,371,000. The previous week’s level was revised down by 5,000 from 1,408,000 to 1,403,000.

The 4-week moving average was 1,417,000, a decrease of 36,250 from the previous week’s revised average. This is the lowest level for this average since February 21, 1970 when it was 1,409,750. The previous week’s average was revised down by 1,750 from 1,455,000 to 1,453,250. 2 UNADJUSTED DATA The advance number of actual initial claims under state programs, unadjusted, totaled 196,962 in the week ending April 30, a decrease of 7,164 (or -3.5 percent) from the previous week. The seasonal factors had expected a decrease of 25,765 (or -12.6 percent) from the previous week. There were 510,161 initial claims in the comparable week in 2021.

The advance unadjusted insured unemployment rate was 1.0 percent during the week ending April 23, unchanged from the prior week. The advance unadjusted level of insured unemployment in state programs totaled 1,403,685, a decrease of 38,872 (or -2.7 percent) from the preceding week. The seasonal factors had expected a decrease of 19,646 (or -1.4 percent) from the previous week. A year earlier the rate was 2.7 percent and the volume was 3,763,243.

The total number of continued weeks claimed for benefits in all programs for the week ending April 16 was 1,478,348, a decrease of 35,165 from the previous week. There were 16,151,803 weekly claims filed for benefits in all programs in the comparable week in 2021.

No states were triggered “on” to the Extended Benefits program during the week ending April 16.

Initial claims for UI benefits filed by former Federal civilian employees totaled 489 in the week ending April 23, a decrease of 14 from the prior week. There were 391 initial claims filed by newly discharged veterans, an increase of 23 from the preceding week.

There were 7,333 continued weeks claimed filed by former Federal civilian employees the week ending April 16, a decrease of 798 from the previous week. Newly discharged veterans claiming benefits totaled 4,306, a decrease of 22 from the prior week.

The highest insured unemployment rates in the week ending April 16 were in California (2.1), New Jersey (2.1), Alaska (1.9), Minnesota (1.6), New York (1.6), Illinois (1.5), Puerto Rico (1.5), Connecticut (1.4), Massachusetts (1.4), Michigan (1.4), and Rhode Island (1.4).

The largest increases in initial claims for the week ending April 23 were in New York (+4,760), Massachusetts (+3,491), Connecticut (+1,045), Georgia (+932), and New Jersey (+888), while the largest decreases were in California (-2,860), Ohio (-2,609), Michigan (-1,887), Washington (-475), and Minnesota (-453).

ABC predicts construction workforce shortage of 650,000 this year

By LBM Journal

The construction industry will need to attract nearly 650,000 additional workers on top of the normal pace of hiring in 2022 to meet the demand for labor, according to a model developed by Associated Builders and Contractors.

“ABC’s 2022 workforce shortage analysis sends a message loud and clear: The construction industry desperately needs qualified, skilled craft professionals to build America,” said Michael Bellaman, ABC president and CEO. “The Infrastructure Investment and Jobs Act passed in November and stimulus from COVID-19 relief will pump billions in new spending into our nation’s most critical infrastructure, and qualified craft professionals are essential to efficiently modernize roads, bridges, energy production and other projects across the country. More regulations and less worker freedom make it harder to fill these jobs.”

ABC’s proprietary model uses the historical relationship between inflation-adjusted construction spending growth, sourced from the U.S. Census Bureau’s Value of Construction Put in Place survey, and payroll construction employment, sourced from the U.S. Bureau of Labor Statistics, to convert anticipated increases in construction outlays into demand for construction labor at a rate of approximately 3,900 new jobs per billion dollars of additional construction spending. This increased demand is added to the current level of above-average job openings. Projected industry retirements, shifts to other industries and other forms of anticipated separation are also factored into the model.

Based on historical Census Bureau Job-to-Job Flow data, an estimated 1.2 million construction workers will leave their jobs to work in other industries in 2022. It is expected that this will be offset by an anticipated 1.3 million workers who will leave other industries to work in construction.

“The workforce shortage is the most acute challenge facing the construction industry despite sluggish spending growth,” said ABC Chief Economist Anirban Basu. “After accounting for inflation, construction spending has likely fallen over the past 12 months. As outlays from the infrastructure bill increase, construction spending will expand, exacerbating the chasm between supply and demand for labor.

“An added concern is the decline in the number of construction workers ages 25-54, which fell 8% over the past decade. Meanwhile, the share of older workers exiting the workforce soared,” said Basu. “According to the Centers for Disease Control and Prevention, the industry’s average age of retirement is 61, and more than 1 in 5 construction workers are currently older than 55.

“The scarcity of qualified skilled workers is an even more pressing issue,” said Basu. “Since 2011, the number of entry-level construction laborers has increased 72.8%, while the number of total construction workers is up just 24.7%. For reference, the number of electricians was up 23.9% over that span while the number of carpenters actually declined 7.5%. The number of construction managers has increased by just 2.1%. More than 40% of construction workforce growth over the past decade is comprised of low-skilled construction laborers, who represent just 19% of the workforce.

“The roughly 650,000 workers needed must quickly acquire specialized skills,” said Basu. “With many industries outside of construction also competing for increasingly scarce labor, the industry must take drastic steps to ensure future workforce demands are met.”

In 2023, the industry will need to bring in nearly 590,000 new workers on top of normal hiring to meet industry demand, and that’s presuming that construction spending growth slows next year.

“Now is the time to consider a career in construction,” said Bellaman. “The vocation offers competitive wages and many opportunities to both begin and advance in an industry that builds the places where we work, play, worship, learn and heal. ABC member contractors use flexible, competency-based and market-driven education methodologies to build a construction workforce that is safe, skilled and productive. This all-of-the-above approach to workforce development has produced a network of ABC chapters and affiliates across the country that offer more than 800 apprenticeship, craft, safety and management education programs—including more than 300 registered apprenticeship programs across 20 different occupations—to build the people who build America.”

Click here to view ABC’s methodology in creating the workforce shortage model.

Seattle ranked 13th on list of cities for unemployment rate bounce back

By The Center Square

Four Washington state cities made WalletHub’s list of nearly 200 municipalities ranked in terms of unemployment rate bounce back in the aftermath of the COVID-19 pandemic: Seattle, Spokane, Tacoma, and Vancouver.

In its report, the personal finance website examined 180 cities by comparing each city’s unemployment rate during the latest month for which data is available, March, to unemployment rates for March 2019, March 2020, March 2021, and January 2020. WalletHub also considered each city’s overall unemployment rate.

“Of the four Washington cities included in the report, Seattle is the best ranked, at number 13,” WalletHub analyst Jill Gonzalez explained in an email to The Center Square. “The city is among those where unemployment rates are bouncing back the most because it has the biggest drop (over 60%) in the number of unemployed people in March 2022 compared to March 2020, which is when the pandemic started. The overall unemployment rate in Seattle is 2.1%, the sixth lowest nationwide and significantly smaller than the average of 3.6%.”

The other Washington cities on the list didn’t fare as well, Gonzalez pointed out.

“The other three Washington cities, Spokane, Tacoma and Vancouver rank in the bottom 25 cities with the slowest recovery,” she said.

Tacoma was the lowest ranked Washington city on the list, coming in at No. 172. Vancouver was ranked No. 163, and Spokane was ranked No. 159.

There were various reasons for the three cities’ lower placement on the list, Gonzalez noted.

“Spokane and Tacoma registered very small drops in the number of unemployed people compared to March 2020 – less than 10%, while Vancouver actually had almost 5% more unemployed people in March 2022 compared to March 2020,” she said. “When compared to the same time last year, the number of unemployed people in the three cities is lower by only about 20%, one of the smallest percentages in the country. Plus, the overall unemployment rate in these three cities is above 5%, higher than the average of 3.6%.”

Arizona cities accounted for eight of the top 10 cities on the list. Cities in Vermont made up the other two.

The top 10 cities in terms of unemployment rates bouncing back:

1. Scottsdale, Arizona

2. Tempe, Arizona

3. Gilbert, Arizona

4. Burlington, Vermont

5. Chandler, Arizona

6. Mesa, Arizona

7. Glendale, Arizona

8. South Burlington, Vermont

9. Peoria, Arizona

10. Phoenix, Arizona

The bottom 10 cities in terms of unemployment rates bouncing back:

180. Detroit, Michigan

179. Cleveland, Ohio

178. Dover, Delaware

177. New York, New York

176. New Orleans, Louisiana

175. North Las Vegas, Nevada

174. Fayetteville, North Carolina

173. Bridgeport, Connecticut

172. Tacoma, Washington

171. Wilmington, Delaware

Delaware’s 204.07% Personal Income Tax rate harms small business owners

By Caesar Rodney Institute

Sen. Darius Brown’s committee positions reinstated

Delaware Live

State Sen. Darius Brown has been reinstated as chair of the Senate Judiciary Committee and member of the Senate Capital Improvement Committee.

Brown, D-Wilmington, was removed from the Judiciary Committee in May 2021 after being arrested on misdemeanor offensive touching and disorderly conduct charges.

He was removed from the Capital Improvement Committee in Nov. 2021 after a heated altercation with Rep. Melissa Minor-Brown, D-New Castle, who accused him of verbally abusing her.

He was found not guilty on all charges in Jan. 2022.

“As Pro Tempore, I removed him from these committees in the face of the allegations he faced last year, and I have now reinstated him given his acquittal in court and my belief that the terms of these sanctions have been appropriate,” said Senate President Pro Tempore Dave Sokola, D-Newark.

“I want to thank Sen. Kyle Evans Gay and Sen. Marie Pinkney for their time and dedication in filling these roles over the last year. Their service has been exemplary,” Sokola said.

Following the Nov. 2021 verbal altercation with Minor-Brown, Sokola said, “Verbal abuse is abuse, full stop, and it cannot go unpunished. In the Senate, there will be consequences for behavior unbecoming an elected official.”