Lawmakers can do little to boost jobs, experts say

COLUMBIA - While a legislative committee is expected to work for months to reform the state's unemployment agency and help people get jobs quicker, and gubernatorial candidates are vowing to bring jobs to South Carolina, economists say there is little the Legislature can do to turn around the state's high unemployment rate next year.

'We need jobs, and that is not going to come out of this (the committee's effort),' said Don Schunk, a research economist at Coastal Carolina University.

'The fact of the matter is we need to generate hundreds of thousands of new jobs in South Carolina, and that's what's going to correct this unemployment problem. And that's not going to come out of this effort.'

So residents like James 'Andy' Trotter of Travelers Rest, who has been out of work for 22 months, wait.

Trotter said he is grateful for anything lawmakers can do to better match jobs with workers and improve the unemployment system. 'I have faith they'll do something,' he said, noting that while many in the state are unemployed, 'We still vote.'

Bruce Yandle, a professor and dean emeritus from Clemson University's College of Business and Behavioral Science, said, 'I would be somewhat skeptical there would be some new discovery about an improved process for identifying needs of the unemployed and more rapidly matching those needs with jobs. 'I would be skeptical that something more meaningful could be discovered and put into place so that we could say, ‘Aha,' so the unemployment rate in South Carolina, all other things being the same, is going to be lowered next month or in three months.'

A House committee appointed by House Ways and Means Chairman Dan Cooper and led by House Majority Leader Kenny Bingham has been meeting for two weeks and is expected to meet into and perhaps through January to create legislation to reform the state Employment Security Commission and address the state's empty unemployment trust fund.

In addition to facing one of the nation's highest unemployment rates, lawmakers also are studying what to do about federal loans expected to reach $1 billion next year to pay unemployment benefits and how to replenish the state's trust fund with $800 million to $1 billion to keep it solvent through future recessions.

Bingham, who unsuccessfully tried this year to pass a reform package concerning the agency, thinks the effort this time is more comprehensive and could result in a better way to match jobs with the unemployed.

'That's not going to change unemployment from 12 percent to 5 percent,' he said. 'Jobs are the only thing that do that. But if you can help match people with jobs and they get jobs quicker, then that helps put people back to work quicker, which is a benefit, and it helps lower unemployment, which is a benefit. It's just one piece of the puzzle.'

Bingham's panel likely will wait on the results of a Legislative Audit Council report on the agency, he said, before making its own recommendations. That legislation could address everything from who supervises the agency, to a restructuring of unemployment insurance, to restrictions on seasonal workers and jobless benefits, Bingham said.

Yandle said it is possible lawmakers can find a way to better match jobs and the unemployed, but he has his doubts. 'Given the current makeup of the Employment Security Commission and its mandate and organic legislation, I'm skeptical that you can get inside that box and do some tweaking and get an outcome that would be significantly different than the one we have now,' he said.

Doug Woodward, director of research for the University of South Carolina Darla Moore School of Business, said while the Legislature's actions aren't likely to dramatically cut the state's 12.1 percent unemployment rate, he thinks lawmakers can do things indirectly to attract and nurture jobs, such as improving the business climate.

And he said legislators can do things to improve the state's unemployment system, such as adding penalties for those who repeatedly use the system.

'If you take a serious study about how it operates in the state compared to other states, I think we could go at least part of the way to explain why we have drifted higher than the national average. Bringing (the unemployment rate) down from 12 percent to 6 percent is going to be determined by the larger economy.'

Schunk said lawmakers can streamline the unemployment system and improve job placement. He said legislators also can continue working on making the state an attractive environment for business by improving its education system, building adequate roads and making sure the state has the right kind of tax system.