Missouri lags all surrounding states and national average in real per capita income growth.

Fig1RealPerCapitaIncomeGrowth

Missourians making $1,867 per year less without RIGHT-TO-WORK Law

A study released today clearly demonstrates Missouri’s economic performance lags not only the national average but the economic performance of all surrounding states.

The study was performed on behalf of United for Missouri, a statewide grassroots organization of over 77,000 citizen leaders committed to advancing every individual’s right to economic freedom and opportunity

“The economic stagnation being experienced by Missouri families has cost them opportunities for new jobs and resulted a growth in state population well below the national average. Most of all, it has cost them where it counts, in their wallets. Missourians are making less money than they would if we were a Right-to-Work (RTW) state.” said Carl Bearden, Executive Director of United for Missouri.

Fig5GrowthRealPersonalIncomeRTWvsNon-RTW1970-2013

Fig6ActualvsPredictedPerCapitaIncGrowthMORTW1983-2013

The study of Missouri’s economic distress covers the last 30 years.  Key findings of the study are:

  • If Missouri had adopted a RTW law in 1983, personal income in the Show Me State would have been an estimated $11.286 billion higher in 2013 than it actually was, or $1,867 per person; even if the true figure were only one-fourth that amount, the positive economic impact of a RTW law would have been very strong, increasing average income by more than $100 a month for a household of three;

 

  • Even controlling for other factors, it’s estimated migration into a state from 2010 and 2014 was 74,800 higher when the state had a RTW law; RTW laws appear to be associated with a perceived improvement in the quality of life;

 

  • Missouri’s per capita income growth deficit relative to the nation has grown sharply in recent decades; with a RTW law it is estimated that Missouri’s economic growth rate would have exceeded the national average and nearly half the current income deficit between Missouri and the nation would have been eliminated;

 

  • The higher economic growth associated with RTW would have led to higher tax revenues for Missouri governments, leading either to more government services, greater tax relief for citizens, or a combination of both of these factors.

According to the study’s senior author, Richard Vedder, Distinguished Professor of Economics Emeritus at Ohio University, “right-to-work laws can be justified on philosophical grounds (providing more choices for workers in labor markets), on the grounds they force unions to be more effective (by increasing competition and reducing their monopoly power), but mainly in Missouri’s case because of the big positive impact they have on economic growth and job formation.”

Bearden said, “There is no doubt that if Legislators want to improve Missouri’s economic future making Missouri a player in relocation planning instead of a fly-over state and if they are interested in increasing the average take home pay of Missourians, they will vote “YES” to override the Governor’s veto of House Bill 116 on September 16, 2015.  It’s time Missouri government took steps to provide opportunity to everyone instead of picking winners and losers as it does now.”

Details of the study are available here.

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