Maine economy not so hot AFL-CIO ranks state 14th worst in nation

BANGOR – Only 13 other states had working families struggling harder than those in Maine to make ends meet during the first three years of the Bush administration. This finding came as part of a report issued this week by the country’s largest labor union.

The AFL-CIO does not deny that its purpose is to publicize that President Bush’s economic policies have not trickled down to working families, and acknowledges that the timing of its release is to coincide with the full-speed-ahead start of the presidential campaign season. The AFL-CIO typically endorses Democratic candidates.

But the labor union insists that the numbers collected for its “Economic Richter Scale” are from federal government data sources that are objective, according to Chris Owens, public policy director of the AFL-CIO.

The report gauges how workers and families are faring in terms of unemployment, job losses and creation, poverty, health care coverage, household income and personal bankruptcies.

The AFL-CIO used the words “Richter scale” in the title of its report so that readers would relate it to seismic activity during an earthquake. Maine’s rating was 5.1 on the Economic Richter Scale, and the worst state, North Carolina, had a 9.3 rating.

The country, like Maine, had a 5.1 Economic Richter Scale rating, which is not an average of all states. Other states that ranked worse than Maine were Mississippi, Michigan, Colorado, Illinois, Oregon, South Carolina, Missouri, Utah, Texas, Nevada, Arizona and Indiana. New Hampshire ranked 20th, at 4.6.

Owens said the report is not necessarily intended to be an indictment of state economic development policies.

“It’s largely a problem on the national level, with policies set on a national level that are affecting states like Maine,” she said Friday.

But Jeff Sosnaud, deputy commissioner of the state Department of Economic and Community Development, said Maine should react to national policies by implementing ones that will improve the working environment for Mainers.

“The situation now is not at all satisfactory,” said Sosnaud, noting that Gov. John Baldacci has an economic stimulus plan that includes business enterprise zones and a business-friendly health care plan in the works. “He’s been in office 10 months and he needs time to make them happen.”

According to the report, Maine has experienced the following economic factors between January 2001 and September 2003:

. Unemployment grew by 1.6 percentage points, from 3.3 percent to 4.9 percent, a 54 percent increase.

. Two of every five unemployed workers exhausted their unemployment benefits without being able to find work.

. A total of almost 5,000 jobs were lost, with the manufacturing sector losing 14,100 jobs and the information and technology sector losing 700 jobs. Some of these losses were offset by gains in government and services.

. Personal bankruptcy filings rose 11.4 percent, from 3,880 petitions to 4,321 petitions.

Between 2000 and 2002, the latest numbers that are available for Maine, the following occurred:

. The poverty rate increased by 3.3 percent.

. The number of uninsured Mainers dropped by 0.2 percent.

. The median household income fell 2.7 percent, to $37,024.

“Good jobs are being eliminated and the quality of life for Maine’s working families is going downhill,” said Ed Gorham, president of the Maine AFL-CIO. “We desperately need to turn this situation around nationally and in Maine.”

In the last few days, the federal government and numerous economists have said that job creation is under way. According to the federal government, more than 125,000 new jobs were created last month, while the unemployment rate fell to 6 percent and first-time jobless claims fell to the lowest level since January 2001.

During a press briefing Thursday, White House Press Secretary Scott McClellan said that the “economy is moving in the right direction.”

“The President has expressed optimism about the direction that it is moving,” McClellan said. “But he has also said that there is more to do. There are people that are still hurting because they are looking for work and they cannot find a job.”

But the AFL-CIO counters that job creation hasn’t come fast enough. Spokeswoman Suzanne Ffolkes said President Bush announced in May that his economic stimulus package would create 306,000 new jobs a month starting in June.

“What we’re seeing now is he’s about a million jobs short of that promise,” Ffolkes said.

The AFL-CIO wants Bush to invest in the nation’s infrastructure to create construction and other jobs, raise the minimum wage, financially assist states that have lost tax revenue because of federal trade policies and extend emergency unemployment benefits that expire at the end of the year.