S.C. Rep. Bobby Harrell, Speaker, S.C. House of Representatives
Our state has received a wake up call. When Standard & Poor's recently downgraded South Carolina's bond rating from the highest AAA level to AA+, it pointed to the state's sluggish growth and higher than average unemployment rate. Moody's Investors Service recently reaffirmed our AAA, but gave us a “negative outlook” primarily because of our unemployment rate. It praised our state's conservative debt and fiscal management while cautioning us about economic weakness and employment declines.
The news from S&P and Moody's and the fact that the state's unemployment rate has fallen from third-best in the nation to fifth-worst has brought to light that it's time to intensify our economic development and job-creation efforts.
We must reprioritize and refocus on economic development to bring about the kind of job growth that helped us to grow South Carolina's economy in years past. The bottom line is this: The General Assembly is committed to working with the governor and private- sector leaders to overcome every obstacle to economic growth. Together we must develop a strategic approach to stimulate job creation and raise income levels across the state.
The solution is tri-fold. First, we need to continue to aggressively recruit companies to South Carolina – companies that open up job opportunities for our citizens. Next, we need to identify and implement ways to help large and small South Carolina companies not only survive but also thrive, and in thriving create new and better paying jobs. Finally, we must transform our research universities into economic engines, the same way North Carolina did when they formed the research triangle 40 years ago.
Reformation begins with an in-depth look at the Department of Commerce's toolbox. We need to give this agency the tools and resources it needs to succeed. We also need to fully support the various economic development groups. With a spirit of cooperation among all regions of our state, we can better compete against the rest of the nation – and even the world.
In 2004, the hardworking folks at the Department of Commerce doubled the amount of capital investment they attracted to our state in the previous year. We need to build on this momentum. But again, that requires us to take a look inside the agency's toolbox and make sure it is equipped for success.
The availability of a well-trained workforce is also key to recruiting companies to our state. Knowing this, we must continue to work to build a first-rate educational system. We must strengthen our world-class workforce development programs offered by our technical college system.
The next step to reach these goals is identifying and implementing ways to help existing South Carolina companies – both large and small – thrive and create new and better paying jobs. As President George Bush recently pointed out at the National Small Business Week Conference in April, small businesses create two-thirds of new private-sector jobs in America, employ more than half of all workers, and account for more than half the output of the U.S. economy. South Carolina must continue to support small businesses.
The General Assembly has built a solid record of enacting legislation to support the business community and companies of all sizes. In fact, a sample of legislation from the 2005 session alone includes the Jobs Creation Act, the Tax Credit Carry Forward Act, the Small Business Income Tax Reduction Act, the Air Carrier Hub Terminal Facilities Act, the State Ports Authority Facility Investment Tax Credits Act, the Venture Capital Investment Act, the Innovation and Research Centers Act, the Motion Picture Industry Film Incentives Act, and comprehensive Tort Reform. All of this pro-business legislation clearly demonstrates the General Assembly's strategic focus during the last session on building a business-friendly climate in South Carolina.
When the next session begins, we must continue to proactively introduce and pass legislation that helps South Carolina companies experience the kind of success that is long lasting. That means keeping our finger on the pulse of businesses to determine what they need to grow.
Finally, we must transform our research universities into economic engines. South Carolina's economy is in transition. We have seen declines in long-time economic staples, such as agriculture and textiles, since the 2001 recession. South Carolina must position itself as a viable player in a changing economy. Two of the bills the legislature passed in the 2005 session, the South Carolina Innovation and Research Centers Act and the Venture Capital Investment Act, are meant to put us on the road to a knowledge-based economy.
It is going to take the cooperation of government and business leaders committed to working together as we transition to a knowledge-based economy. At the end of the day, pointing fingers won't help us meet the challenge. We must prepare a roadmap that will take us from where we are to where we need to go. A renewed focus on creating new and high-paying jobs will raise income levels and improve the quality of life for our citizens. We must face our state's growth challenge head on, embrace our various roles in job creation, and turn the dream of a better life for South Carolinians into a tangible reality.