Thursday, October 29, 2015

Kansas Historically Better Than Missouri, Jobs-wise

Am I mainly writing this to tout Kansas as historically superior to Missouri?  Yes.  Probably.  I may also be writing this because I work in the Kansas City area and don't want to have to drive to Missouri for work.

This is somewhat seriously related to my recent posts on the Kansas jobs report, maps, and arguments between pundits, but more nuanced as it is specifically related to differences in the Missouri versus Kansas side of the Kansas City Job Market.  Here are the takeaways:

  • Historically: Kansas side has beat Missouri side 19 of the past 24 years, the last time Kansas lost in a non-recession year was 1999.
  • 2010-2014: Kansas beat the Missouri side each of these years, following recession impacted years of 2008-2009.
  • 2015: Kansas is currently pacing behind Missouri, which would be its first non-recession loss since 1999.

BACKGROUND

The background of this post is rooted in an article in the KC star regarding jobs reports, followed by a twitter argument between conservatives and liberals.  The initial argument was exacerbated by a date issue in the original article, now corrected, but the argument is generally this:
  • Liberal: Kansas is losing the jobs growth war in 2015.
  • Conservative: Kansas is losing in 2015 only as a correction to high growth in 2013 and 2014.
Here are some tweets to give you a flavor of this:




Yikes!  Everyone gets so serious about this stuff.  One last good piece of background, while the Missouri side of Kansas City has the majority of population, the growth center in KC over the past couple of decades has been the affluent Johnson County Kansas suburbs.

DATA 

The problem with the above argument between pundits is that it doesn't look over a long enough time horizon to understand long-term trends and patterns. Here's the question at hand:
Should we really give current Kansas policy makers a win if they beat Missouri by 1%, if they have been beating Missouri by 1% for the past two decades?  
I dug in and analyzed BLS data from 1990-2014.  Here's a chart of annualized growth rate in average jobs per month:


Some takeaways:

  • Excluding recession years, Kansas generally beats Missouri by an average of 0.75%.  
  • Kansas has beat Missouri in Job Growth 19 of the past 24 years, "loss" years were: 1993, 1994, 1999, 2008, 2009.
  • Controlling for the 0.75% historic growth rate differential, the actual win/loss record looks like this:
    • 2013: KS (+1.23%)
    • 2014: KS (+0.59%)
    • 2015: MO (+1.31%) (pacing)
  • If the 2015 pattern holds, it would be significant for Kansas as it would be the first non-recession loss to Missouri since 1999.

CONCLUSION

The argument over the Kansas versus Missouri jobs is informed by historical data showing Kansas winning over the past 24 years.  If policy makers want to take credit for beating Missouri in job growth, they should probably show growth levels significantly above historical averages.  That said, the scorecard for the past two years shows 2013 and 2014 as wins for Kansas, 2015 as a win for Missouri.  I will continue tracking these metrics; the end of year report should be interesting.


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