Mississippi’s economy suffers more than officials say

Published 10:46 am Thursday, June 11, 2015

Just last year, Gov. Phil Bryant was busy touring the state, touting Mississippi’s economic growth. There were stops in big cities and small towns, but the message was the same: Mississippi’s economy is vibrant.

But a report out Wednesday paints a different picture of the state. New figures released by the federal Bureau of Economic Analysis show the state’s economy was in recession in 2013 and 2014. The numbers show Mississippi’s economy shrank by 1.2 percent in 2014, the only state besides Alaska where economic output got smaller last year, according to The Associated Press.

“The weakness was widespread in Mississippi’s $105 billion economy, with 12 of the 21 economic sectors measured showing declines,” AP reported.  “Construction alone accounted for more than half the decline, which was attributed to a decline in the workforce building Mississippi Power Co.’s $6.2 billion plant in Kemper County. Other major contributors to the decline included agriculture and forestry, government, oil and gas production and utilities.”

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The bright spot in the report was manufacturing, where the value of output expanded for makers of long-lasting goods such as machinery, vehicles and furniture, as well as for makers of nondurable goods such as food, gasoline and chemicals.

The report makes it clear we’ve still got much work to do before our economy is strong again.  Part of that work will be investing in education, job-training programs and improving infrastructure.  It will also include making sure our state’s tax code is business-friendly.  Getting rid of the hated corporate franchise tax would help.

Despite its name, a franchise tax is not a tax on franchisees.  It’s simply a tax imposed for the privilege of doing business in the state, and it’s a major impediment to growth.  Unfortunately, Lt. Gov. Tate Reeves’ plan to eliminate the franchise tax died in the recent legislative session.