Unions, High Income-Tax Rates –> No Jobs

This Just in: High Taxes Plus High Unionization Correlates to Joblessness. Who would’ve thought!?

The latest Bureau of Labor Statistics numbers seem to indicate that:

3 of the 6 states with the HIGHEST unemployment (California, Oregon, and Rhode Island) have both high marginal income tax rates AND high union representation. Michigan has high unionization but moderate marginal income tax rates, and the Carolinas have high marginal income taxes, but low unionization rates.

Among the 6 states with the LOWEST jobless rates, 4 have low unionization rates and no state income tax or modest marginal rates and a fifth (Nebraska) has average income tax rates and low unionization. The exception is Iowa, which has average unionization rates (13%) and high marginal income taxes (8.98%).

Numbers don’t lie. Recessions seem to be worse on employment in states with high unionization and high income taxes because it is costlier for businesses to keep employees on the payroll when revenues slow their growth or fall. A lesson for Oregon, perhaps? (Oregon almost always leads the country in unemployment during recessions–look at their numbers in the early/mid 1970′s or 1982 and you’ll see what I’m talking about.)

Via Reason.