There they go again. A few months after the UNC Board of Governors dropped some big cash on system chancellors, UNC Chapel Hill trustees have bestowed big, retroactive raises on an array of already extremely well-paid administrators. This is, of course, at a time when other North Carolina public employees of more modest stature are mostly doing without.
As Jane Stancill of Raleigh’s News & Observer reports this morning:
“UNC-Chapel Hill’s athletic director, Bubba Cunningham, recently received a 10 percent raise, bringing his annual pay to $642,268.
The $58,388 increase for Cunningham was the largest among those approved for nine high-ranking university administrators, who got raises or bonuses ranging from 1 percent to 10 percent.
The increases were part of the annual raise process, according to a university spokesman who said new salary levels were retroactive to July 1, 2015. Trustees initially approved the increases in a December mail ballot, which was ratified last week. The vote last week was unanimous.”
The article goes on to report that the trustees hope to “make adjustments in faculty pay” as well, but as always seems to be the case, that will come after the folks at the top are taken care of. No word about adjunct instructors, food service workers, janitors, etc….
Of course, it seems likely that the conservative leaders in state government will be all in with this approach. After all, they always talk about wanting to “run government like a business” and what could be more business-like in modern America than bestowing big raises on the bosses first and leaving the crumbs for everyone else?
(As an aside, it’s also worth noting that all of the folks receiving raises have received extremely large state income tax cuts in recent years thanks to the the shortsighted policies at work in Raleigh).
Click here to read the rest of Stancil’s story ans see the full list of raises.
Supporting homegrown startups and young, fast-growing in-state companies is likely to be a more effective strategy for states to create jobs and build a strong economy than across-the-board tax cuts and other attempts to lure businesses from elsewhere that many states pursue today.
A new report released by the Center on Budget and Policy Priorities titled “State Job Creation Strategies Often Off Base” highlights findings from new research showing that the vast majority of jobs are created by businesses that start up or are already present in a state. The report’s authors conclude that “many state policymakers pursue economic development strategies that are bound to fail because they ignore these fundamental realities about job creation.”
When states pursue tax cuts, they divert resources needed to help home-grown startups and young, fast-growing companies deliver maximum job growth and to build a climate that supports their growth.
Never has the cost of tax cuts to job creation been clearer than in North Carolina where state leaders’ pursuit of income tax cuts has reduced dollars targeted to help entrepreneurs in North Carolina build out their ideas and grow their enterprises. State support for community development finance institutions that support small business development in underserved communities has declined, direct investments in main street revitalization in small towns and cities, and rural economic development and infrastructure have also been significantly restricted in recent years. Meanwhile, North Carolina has failed to pursue many of the best practices in other states that take the best research and development to scale, promote innovative community economic development planning locally through targetted grants or most basically to sufficiently support the best business ideas in local communities that can achieve more inclusive economies. At the same time, public investments that are the foundation of a quality life—investments in good quality schools, parks and recreation—have eroded in our state putting at risk key foundations of entrepreneurship and innovation.
This new research in the report uses improved data to better inform our understanding of which businesses create jobs, and where they create them – calling into serious question the value of large-scale tax cuts and the various other tax breaks states typically offer businesses to move. Among the facts that counter ineffective tax-cut strategies:
- About 87 percent of private-sector job creation from 1995 to 2013 in the median state was “home grown.” The job creation came from startups, the expansion of employment at existing establishments, and the creation of new in-state locations by businesses already headquartered in the state.
- Large income tax cuts that a number of states have enacted or are proposing are especially poorly suited to helping startups and other rapidly growing firms, in part because these businesses often have little income in their early years.
- The most commonly cited reason among entrepreneurs for starting their companies where they did was that it was where they lived at the time. Eighty percent of these entrepreneurs lived in the city where they started their companies for at least two years prior to starting their business. A survey by Endeavor Insight consulting firm concluded that founders of fast-growing companies decide where to live based on personal connections, the talent of the local workforce, and quality-of-life factors. Only five percent of these successful entrepreneurs even mentioned taxes as a reason why they founded their companies where they did.
- To promote and assist job-generating entrepreneurship, states would be wise to invest in schools and colleges, improving workers’ skills, and maintaining communities that are attractive to residents who want to start a business. Successful entrepreneurs report these factors were key to where they founded their companies.
Bottom-line: Homegrown startups and fast-growing firms already in the state are much more important sources of job creation. Public investments that help build a skilled workforce and improve the quality of life for local residents are better bets for supporting real economic progress.
Members of the N.C. State Board of Education received some more troubling news about teachers Wednesday.
Alisa Chapman, vice president for academic and university programs in the UNC system, presented data that show the state’s increasing inability to attract students to the teaching profession.
Since 2010, enrollment in bachelor’s and master’s education programs systemwide has plummeted 30 percent, said Chapman. And while the plunge has slowed—enrollment declined just 3.4 percent from fall 2014 to fall 2015, Chapman told state education leaders that the trend should be “very concerning.”
“The challenge in hiring teachers in our state is going to increase,” said Chapman, adding that it would be “even more challenging” to recruit educators in rural counties, many of which serve a low-income population that tends to struggle academically.
In a state that ranks 42nd in teacher pay nationally, teacher satisfaction and recruitment figures to have a big year in 2016.
The wonks at the Center on Budget and Policy Priorities are out with a new report that, once again, derides the central premise of the “economic development” strategy being pursued by Governor Pat McCrory and the General Assembly.
Here’s the opening to “State Job Creation Strategies Often Off Base”:
To create jobs and build strong economies, states should focus on producing more home-grown entrepreneurs and on helping startups and young, fast-growing firms already located in the state to survive and to grow ? not on cutting taxes and trying to lure businesses from other states. That’s the conclusion from a new analysis of data about which businesses create jobs and where they create them.
The data show that:
- The vast majority of jobs are created by businesses that start up or are already present in a state — not by the relocation or branching into a state by out-of-state firms. Jobs that move into one state from another typically represent only 1 to 4 percent of total job creation each year, depending on the state. Jobs created by out-of-state businesses expanding into a state through the opening of new branches represent less than one-sixth of total job creation. In other words, “home-grown” jobs contribute more than 80 percent of total job creation in every state.
- During periods of healthy economic growth, startups and young, fast-growing companies are responsible for most new jobs. During the Internet-driven boom of the late 1990s and early 2000s, for example, startup firms (those less than one year old) and high-growth firms — which are likely to be young — accounted for about 70 percent of all new jobs in the U.S. economy. Firms older than one year actually lost jobs on average; any new jobs they created were more than offset by jobs they eliminated through downsizing or closure. In short, startups and young, fast-growing firms are the fundamental drivers of job creation when the U.S. economy is performing well.
State economic development policies that ignore these fundamental realities about job creation are bound to fail. A good example is the deep income tax cuts many states have enacted or are proposing. Such tax cuts are largely irrelevant to owners of young, fast-growing firms because they generally have little taxable income. And, tax cuts take money away from schools, universities, and other public investments essential to producing the talented workforce that entrepreneurs require. Many policymakers also continue to focus their efforts heavily on tax breaks aimed at luring companies from other states — even though startups and young, fast-growing firms already in the state are much more important sources of job creation.”
If only our state policymakers would pay attention and abandon their archaic and failed , tax cuts uber alles approach to the economy, North Carolina might really be making some hay. Unfortunately, that clearly is not the case.
Click here to read the entire report.
Forsyth County high school teacher Stuart Egan has a couple of “must reads” you should check out this morning.
Number One is this open letter from the main N.C. Policy Watch site to State Rep. Paul Stam in which he dissects some of Stam’s recent comments about what’s needed in our public schools. Here’s Egan on Stam’s call to evaluate teachers and pay the “best” ones more:
“You said in the interview that ‘we do not pay our best teachers enough and we pay our ‘unbest’ teachers too much.’
I have not really heard the terms ‘best’ and ‘unbest’ used on actual teacher evaluations and would very much like to hear what how such labels might be applied in the real world. But I believe you are touching on teacher effectiveness and teacher evaluations as currently measured by the state.
The problem with teacher evaluation processes in the state of North Carolina is that they are arbitrary at best. No one single protocol has been used to measure teacher effectiveness in your tenure as a legislator. That’s because there has not been one that accurately reflects teacher performance. In fact, during your tenure in Raleigh we have switched curriculum and evaluation protocols multiple times. It seems that teachers are always having to measure up to ever-changing standards that no one can seem to make stand still, much less truly evaluate.”
Click here to read the rest of of the letter.
“The original idea for charter schools was a noble one. Diane Ravitch, in ‘Reign of Error,’ states that these schools were designed to seek ‘out the lowest-performing students, the dropouts, and the disengaged, then ignite their interest in education’ in order ‘to collaborate and share what they had learned with their colleagues and existing schools.’
But those noble intentions have been replaced with profit-minded schemes. Read More