Executing fundamentals for a better bottom line
Editor’s note: this post was originally published in the Deseret News, April 17, 2014.
Utah’s economy is strong and growing stronger. Today, we have the second-fastest growing population with the second strongest economy in the nation. Unemployment has dropped from a high of 8.4 percent when I took office in 2009, to 3.9 percent. Since January 2012, when I challenged Utah’s private sector to create 100,000 jobs in 1,000 days, some 89,900 jobs have been created. We are on track to meet our goal.
We are just as diverse as we are dynamic. Utah has the fourth-most diverse economy in the nation. This is remarkable. Without all our economic eggs in one basket we are not subject to the volatility of a single economic sector, and we are building on a sure foundation for long-term economic growth.
We believe in the fundamentals and know how to execute them to grow our economy.
One of our fundamentals is our commitment to low, competitive and consistent tax rates. Utah collects the 44th lowest amount of revenue per capita in the nation. Of the 45 states with corporate taxes, Utah is tied for the third lowest at five percent. We haven’t raised corporate tax rates since 1985, and I have no plans to do so.
Another fundamental is efficiency in government. We strive to keep government off your back and out of your wallet. Government’s role should be limited to providing the services We the People believe are important. Delivery of those services should be as efficient as possible.
The biggest complaint I hear from the business leaders– even more so than tax policy – is that of unnecessary regulations. Some regulations are necessary to protect the public and to ensure everyone has equal opportunity. But overregulation hinders economic growth. We have not only eliminated or modified hundreds of onerous regulations at the state level, we have also encouraged cities across Utah to do the same thing.
There is more to efficiency in government than simply eliminating bad regulations. We also have a policy of living within our means, saving for a rainy day, and not taking on unnecessary debt. Utah is one of only a handful of states in America to maintain a AAA bond rating. When we do find it advantageous to borrow money for large-scale projects, we do so at the lowest rate possible.
Another important fundamental to our economic strength is developing a skilled labor force. A high school diploma alone will not suffice in today’s highly competitive job market. So we have set a statewide goal for 66 percent of adult Utahns to have a degree or post-secondary certificate by the year 2020. We are also working to ensure the skills our students learn align with the needs in the business community. I am determined to ensure our students are prepared to help drive Utah’s economy forward.
Our efforts to develop our workforce are not without challenges – most notably, the funding of our schools. It costs an additional $70 million each year just to pay for the new students. Further exacerbating matters, nearly 70 percent of Utah’s land mass is controlled by the federal government, generating no property taxes to help us pay for that student growth.
Despite our funding challenges, we have provided new money for education for three consecutive years: $170 million two years ago, $280 million last year and over $390 million this year. This new money includes a $20 million investment in Science, Technology, Engineering and Math instruction to prepare students to compete in what is now a global economy.
Utah high school graduation rates are at 80 percent, up three percent from last year, and we are picking up the pace in post-secondary education. Last year more than 29,000 high school students in Utah earned college credit through concurrent enrollment, saving a combined $60 million in college tuition and getting on the fast track to earning a post-secondary degree or certificate. In addition, the Utah System of Higher Education offers more than 1,500 online courses. Students in Utah have access to 53 online degrees, including 13 master’s degrees.
During the height of the Great Recession, I set a goal for Utah to lead the nation as the best-performing economy and to be recognized as a premier global business destination. Some thought we were being a little too ambitious. By executing the fundamentals, today Utah does lead the nation as the best performing economy, and we are recognized as a premier global business destination.
My commitment to our economic success has never been stronger. Government’s role is to create a business-friendly environment and allow the free market to work. Free enterprise – not government – is the backbone of Utah’s economy.
Our economy is strong. The fundamentals are in place, and we will continue to prosper as we adhere to the principles upon which economic success is based.
Gary R. Herbert is the 17th governor of Utah.