AOI Annual Meeting
Tuesday, November 4, 2015
Good afternoon, and thank you for the opportunity to talk with you today. I’d like to share a few remarks and then open it up for a few questions.
It’s been said that if you want evidence of human folly, read the newspaper, but for evidence of human resiliency, read the sports page.
And when it comes to Oregon’s economic picture, I’m pleased to say my perspective is currently more of the sports-page variety.
Our economy continues to recover at - or a little above - the national average, with 3 percent annual employment growth over the past couple of years. Our state economists are watching carefully for signs of a slowdown, but for now, the outlook is steady and mostly positive.
As Governor, it is important that I make the necessary long-term investments - and take advantage of short-term opportunities - to maintain a strong economy.
Because as you know, state government doesn’t create jobs. According to Business Oregon, 70 percent of new jobs are created when existing Oregon businesses expand. In an increasingly global economy, our state’s economic dynamics are more likely to be influenced by the actions of state government than determined by them. It is my job to make sure state government adds value, that it supports economic growth that results in more good jobs for Oregonians.
This comports with the Oregon Business Plan’s framework, which calls for business and government to work together to:
• Add 25,000 net new jobs per year;
• Raise the per-capita income above the national average by the year 2020; and
• Reduce poverty below 10 percent by 2020.
We are experiencing steady positive job growth to meet that first goal.
To keep the momentum going, we need to make investments in quality infrastructure. Making sure our roads and bridges are in good working order, and addressing traffic congestion, helps get goods to market and workers to their jobs safely and efficiently. However, according to ODOT, more than half of Oregon’s bridges were built prior to 1970, and 57 percent will reach the end of their design lives by 2020. After 2020, an additional 70 bridges per year will be deemed beyond their useful lives and therefore structurally deficient. And that’s just our bridges.
As I’ve said before, Oregon needs a transportation package. Unfortunately, we were unable to reach an agreement by the end of the 2015 session. And now, rumors of a 2016 ballot measure targeting the new clean fuels law have implications for transportation funding.
I am counting on business leaders - including those in this room, to work together with me and my legislative colleagues to address Oregon’s very pressing transportation needs in the 2017 session. We simply cannot afford to delay any longer.
Another way of state government adds value to Oregon’s business enterprise is by funding other infrastructure projects, such as my $56 million water package. With record-high temperatures, record-low snowpack and the lowest annual rainfall since the 1890s, drought is Oregon’s ‘new normal.’ This funding package, passed last session, is essential to meeting our long-term water needs, particularly for agriculture, such an important part of Oregon’s economy.
We cannot talk about the Business Plan’s goal of reducing poverty without talking about raising Oregon’s minimum wage.
I have been very open about my support for increasing the minimum wage to keep up with rising costs in housing, health care, child care and other family necessities.
Currently, the average rent in Oregon for a two-bedroom apartment requires a minimum wage worker to either work 70 hours a week, or to work a regular 40-hour week at $16.70 an hour.
We know that 62 percent of all minimum wage workers are women, and 63 percent of households with children under age 18 are headed by single mothers. This means many of Oregon’s children are growing up in poverty or at subsistence levels. And last year, more than 20,000 kids in the state’s K-12 education system were homeless.
I understand raising the minimum wage will have an impact on our small businesses. These costs are real. But we must weigh them against the longer-term societal costs of a generation raised in poverty, which, to be honest, also costs Oregon businesses and taxpayers.
More than a dozen states took action to increase the minimum wage last year. Oregon needs to step up. If an across-the-board increase on a certain date won’t work, let’s work together to craft a sensible alternative.
Everywhere I go, I talk to business owners. And, consistent with the Oregon Business Plan, they tell me that one of the things state government can do to support growth and expansion is to help ensure a skilled, job-ready workforce.
This calls for high-quality public education from cradle to career.
Thanks to action we took in the 2015 session, we will increase the number of Oregon students who graduate from high school ready: Ready for college or training programs, or ready for work.
In the last session, we invested $7.4 billion in public education to strengthen excellent teaching and learning, with important wrap-around services that support educational success for all of Oregon’s kids.
We significantly increased funding for higher education, and expanded the Oregon Opportunity Grant to support 16,000 more students. We passed Oregon Promise, which makes community college significantly more affordable for thousands of Oregon students. Increasing access to a college education will remain a priority for my administration.
But college isn’t always the right path for everyone, so what can we do to ensure every Oregon student graduates from high school with training and career opportunities?
The answer: Career and Technical education (CTE) and Science, Technology, Engineering and Math (STEM).
CTE and STEM programs give high school and college students real-world experiences that connect class work with careers. Partnerships with Oregon businesses help them transition to hands-on training and good jobs when they graduate.
And while we were able to double the state’s investment in CTE and STEM in the last legislative session, consider this: The state of Washington spends $400 million on CTE alone, compared to the $35 million Oregon will spend on CTE and STEM combined.
I will continue to expand resources for hands-on, real-world learning opportunities that prepare more Oregonians for good jobs and provide Oregon businesses with a job-ready workforce.
In order for this win-win arrangement to expand successfully, I look to you — Oregon’s employers — to partner with more local schools, colleges and universities to achieve the positive outcomes we all seek. I will be talking more about this at the Oregon Business Summit in December, and look forward to seeing you there.