Grow Florida's economy by $74 billion in state GDP, $41 billion in higher personal income, and $1 billion in total state tax revenues
"In total, Florida's economy will gain an additional 700,000 jobs, $74 billion in state GDP, $41 billion in higher personal income, $1 billion in total state tax revenues as a direct result of the increased economic growth."
Gov. Rick Scott's promise to boost economy relies on passing entire agenda
Updated: Wednesday, January 18th, 2012 | By Becky Bowers
Gov. Rick Scott's campaign plan to create 700,000 jobs contains other bold pledges of economic success
Not only will his seven-year, seven-step agenda create new jobs, the plan says, it will boost the state's gross domestic product, personal incomes and tax revenues — all as a "direct result" of increased economic growth.
We're separately tracking the governor's centerpiece pledge to create jobs. Here, we're looking at whether Scott is meeting the other metrics he set out.
'$74 billion in state GDP'
State GDP numbers are updated only annually by the U.S. Bureau of Economic Analysis, says Bill Seyfried, a professor of economics at Rollins College. The last update, released in June 2011, reflected economic recovery in 2010, before Scott took office. (That year, change in Florida's real gross domestic product of $748 billion ranked well below all states' 2.6 percent, at just 1.4 percent.)
We'll be better able to update this part of Scott's promise in June 2012, when BEA updates its statistics. Until then, we can handicap it.
University of West Florida economist Rick Harper notes that Florida's GDP in 2010 was produced by an average of 7 million nonfarm workers, for an average output of $104,182.
If Scott attains his campaign promise of adding 700,000 jobs at the current average gross state product per worker, that would be an increase of $73 billion, he says — on track to meet the governor's goal of $74 billion.
But it's not clear Scott will achieve 700,000 additional new jobs over seven years on top of the million jobs that state economists expected at the time of his promise. Meanwhile, a third of his jobs creation agenda is Stalled. For now, so is this part of Scott's promise.
'$41 billion in higher personal income'
Personal income for Florida in Scott's first quarter in office was $706 billion, according to federal statistics reported in December 2011. Using the same per-worker calculation economist Harper used for the state's gross domestic product, he estimates creation of 700,000 new jobs would yield $69 billion in personal income — beating the governor's projection of $41 billion.
That means he might only need to hit 60 percent of his jobs goal to generate $41 billion in personal income.
Still, Scott would need to accomplish a hefty portion of his agenda — for example, about half of his 700,000 promised jobs would come from reforms such as eliminating the corporate income tax, which is Stalled.
Seyfried, the Rollins College economics professor, points out that key parts of that agenda may not ultimately fall into place. No zeroing out of corporate income tax? That would make it less likely the governor would achieve his jobs goal, and thus other economic growth tied to that hiring.
'$1 billion in total state tax revenue'
State tax revenues for 2010 were $33 billion, according to federal statistics reported in July 2011.
That's 4.2 cents per dollar of the state's gross domestic product that year, according Harper, the UWF economist. So, say the state adds those 700,000 extra jobs, yielding that additional $73 billion in gross domestic product. That would yield tax revenue of $3 billion a year, Harper calculates.
That gives Scott a chance to meet his tax revenue goal even if he doesn't fully accomplish his jobs agenda. Just 230,000 new jobs might generate the extra tax dollars the governor promised.
For that reason, of the pieces of his promise to boost the economy, this one he's the most likely to keep.
During the campaign, Scott clearly explained that his 7-7-7 plan would generate 700,000 jobs on top of expected growth of a million jobs, and that would yield growth in state GDP, personal income, and total state tax revenues.
So to accomplish his promise, he's got to implement his full job creation agenda, something it's not clear he'll be able to do.
We'll revisit this promise as new data becomes available. But for now, we rate his progress Stalled.
Gov. Rick Scott, State of the State Address, March 8, 2011
Email interview with Rick Harper, executive director, Office of Economic Development and Engagement, University of West Florida, Jan. 4, 2012
Interview with Sean Snaith, director, Institute for Economic Competitiveness, University of Central Florida, Jan. 2, 2012