Governor Jim Justice likes to use props to make his points. He frequently writes his key points on a white board during a press conference, and who can forget when he lifted the lid on a silver platter of manure to express his displeasure with a budget proposal.
This week Justice broke out the Hawaiian leis to try to put his own colorful celebratory touch on the announcement about the latest economic numbers for the state. A big man in a tropical garland may be a questionable fashion statement, but the fiscal news was undoubtedly positive.
Personal income tax and consumer sales tax collections are among the best indicators of growth because they are reflective of how much people are earning and spending. Both are surging. Personal income tax collections reached just under $146 million in July, the first month of the new fiscal year. That’s $10 million ahead of projections and nearly 14 percent higher than July 2017.
Consumer sales and use tax collections reached $87 million in July. That’s $9 million over estimates and a whopping 33 percent over the same period last year. (Part of that increase in the rate of growth is attributable to an $11 million transfer to the State Road Fund last year.)
The steady rise in consumer sales tax collections indicates people have more money to spend and greater confidence in the economy. Additionally, a significant increase in construction, due in part to all the highway work and natural gas pipeline construction and the ramping up of the P&G plant near Martinsburg are contributing to a rise in this category.
The employment picture is also getting brighter. State figures show total employment reached 743,100 in June, while 42,000 West Virginians were jobless. That’s a manageable unemployment rate of 5.3 percent. The numbers show West Virginia has added 5,000 jobs in the last year.
The argument that West Virginia’s economy is growing again is also reinforced by figures from the U.S. Department of Commerce’s Bureau of Economic Analysis. Its most recent report shows that personal income net earnings increased by 4.9 percent from January through March compared with the previous quarter.
West Virginia’s fiscal year is off to a solid start. Total July tax collections were more than $32 million higher than projections, creating a cushion in case the economy slows again. To put July’s numbers in perspective, the surplus for all of last fiscal year was $36 million.
Governor Justice called the numbers “incredible.” As we have said before, Justice is given to hyperbole, but these are very good numbers, and they do not appear to be a one off. The growth started last year and is picking up steam.
The key now is to keep the ball rolling. The Governor and the Legislature still need to hold tight the reins on spending, continue to adopt policies that promote economic growth and keep the tax-and-spend crowd in check.
As for the Hawaiian leis? Well, they are a heck of a lot more cheerful than a silver platter of bull manure.