At the outset of the 21st century’s third decade, the Arizona economy is now at its healthiest point ever and is getting stronger.
The state is one of the nation’s leaders in job growth, Maricopa County is the country’s fastest growing county, Phoenix is one of the nation’s fastest-growing big cities, and new announcements of major job-creating investments are a regular — and welcome — occurrence in every corner of Arizona, whether it’s Tucson emerging as a top city for tech firms, Pinal County becoming a center for advanced auto manufacturing or the West Valley becoming a new hub for spiked seltzer.
Clearly, Arizona is open for business.
It’s against this rosy backdrop that the Arizona state Legislature prepares to begin another session.
It wasn’t always like this. A decade ago, Arizona bore the brunt of the great recession, losing more than 300,000 jobs. State government wasn’t spared. Revenues plunged dramatically and budgets were slashed.
But Arizona emerged stronger, with an economy more resilient than it’s ever been. The success hasn’t been accidental or because of pure luck, but because specific, intentional policies were enacted to position the state for the robust growth that has defined the last several years.
The Arizona Chamber of Commerce and Industry and the Arizona Manufacturers Council led the charge in the business community for the implementation of those job-creating policies, so as we enter 2020, it’s a role we’re eager to reprise. Arizona’s job creators are ready to partner with Gov. Doug Ducey and lawmakers from both parties to ensure Arizona’s economic momentum continues.
That means assessing where we can enhance our competitiveness, responsibly confronting challenges and positioning the state for future success. It also means resisting misguided efforts that could reverse our progress.
Don’t California my Arizona
We know public policy can make the difference between economic expansion or contraction. Just take a look at the latest United States Census projections, where Arizona is poised to secure a new congressional seat. States like California and New York (my native state) meanwhile, two states that have been hostile to job creation, are shrinking.
The Arizona Chamber in 2020 will oppose any efforts, whether at the state capitol or at the ballot box, that would attempt to bring to Arizona other states’ failed policies that have stifled digital innovation, threatened labor mobility or driven up the cost of living.
A talent pipeline for today and tomorrow’s jobs
Arizona’s growth hasn’t come without its unique challenges, though.
We have many more jobs than people to fill them, for example. Arizona needs a robust and reliable talent pipeline in order to meet the demands of today’s job market and the jobs of tomorrow.
To achieve this goal, the Arizona Chamber will continue its advocacy for increased investments and smart reforms in K-12 education, including the final installment toward the 20% average statewide teacher pay increase, the restoration of additional assistance dollars, Results-Based Funding and the expansion of Career and Technical Education (CTE) dollars.
Our members are focused on higher education, too, including the Arizona Board of Regents’ New Economy Initiative and expanded funding for industry-aligned centers like the Aviation Technology Center at Pima Community College and Maricopa Community Colleges’ work to bolster the health care talent pipeline.
A tax code that encourages job creation
Much of Arizona’s growth over the past decade can be attributed to the tax reforms successfully championed by the Arizona Chamber, including those approved by Ducey and the Legislature in 2019, which have proven to be the key to the expansion of Arizona’s economy.
Our tax climate is now the most competitive in the state’s history, with our corporate and personal income tax rates among the best in the nation.
Not only is state government well positioned to meet its ongoing core responsibilities, but the Rainy Day Fund is at an all-time high at $1 billon, and there is a cash balance that will allow lawmakers and the business community to work together to make our tax code even more conducive to investment (a reduction in the commercial property tax assessment ratio, for example) and to address other key priorities in 2020 that will make the state a better place to build a business, get an education and raise a family.
In addition to supporting a pro-growth tax agenda, we have consistently pursued efforts to roll back the regulatory state.
A regulatory moratorium combined with other reforms like universal occupational licensure recognition have reduced unnecessary government-imposed obstacles for entrepreneurs, innovative start-ups and established companies.
In 2020, the Arizona Chamber will continue its efforts to lift the regulatory burden on job creators, which includes making clear that new rules and regulations should be rooted in Arizona law.
A civil justice environment built for jobs
A predictable legal environment has also been important to Arizona’s reputation as a jobs-friendly state.
The Arizona Chamber will continue to play a pivotal role in fostering an environment that ensures Arizona employers can remain focused on investment and expansion, not on hiring lawyers to fend off dubious lawsuits. We’ll focus on ensuring that reforms backed by the Arizona Chamber that increase transparency over state-level outside counsel contracts apply to all levels of government.
Water is economic development
Last year’s passage of the Drought Contingency Plan was a bipartisan bright spot at the state capitol and in U.S. Congress.
The Arizona Chamber and the Arizona Chamber Foundation were proud to have played a key role in convening business sector stakeholders and helping educate public officials on the complicated subject of water stewardship. As the conversation begins to shift from surface water to groundwater, the Arizona Chamber will remain engaged. Like my former boss Sen. Jon Kyl says, water is economic development.
Transportation, trade, and tourism
The U.S. is on the verge of implementing the U.S.-Mexico-Canada Agreement, or USMCA, so now is a good time to make smart investments in projects like Interstate 11 and others that promote freight mobility and reduce congestion.
The same goes for tourism, a gateway industry for Arizona that is ready to pop thanks to USMCA and two of our top inbound travel markets, Mexico and Canada.
We’ll also want to continue to elevate Arizona’s profile on the global stage and efforts that over the last few years have resulted in new trade offices in Mexico City, Chihuahua, Guanajuato and Tel Aviv, Israel.
A health care sector built for a growing state
Essential to safeguarding Arizona’s quality of life will be our ability to ensure key sectors like health care are keeping pace with a growing state. We will work to make sure Arizona is maximizing its share of federal health care dollars so we can continue to attract some of the nation’s leading-edge care providers.
Trade and immigration priorities on Capitol Hill
At a federal level, we look forward to moving into the implementation phase of USMCA.
No state is better positioned for economic success under USMCA than Arizona. Not only are trade volumes through Arizona’s international ports poised to rise, but so are the amount of jobs tied to trade with Canada and Mexico, which already number 228,000 according to a report released by the Arizona Chamber, the Arizona Chamber Foundation and the Arizona-Mexico Commission last year.
The Arizona Chamber was the state business community’s leading advocate for the adoption of USMCA, and we’ll do the same when it comes to forging closer trade ties with China and the United Kingdom.
Not only is China a major export destination, but it’s also a major source of students at our state universities. And the U.K. is one of our top sources of foreign direct investment. Trade deals are percolating with both countries, and the Arizona Chamber will be there to advocate for their advancement.
We will also continue to work with the state’s congressional delegation in seeking a favorable and durable solution to make certain that individuals living in Arizona in an undocumented status — but who were brought to the United States as minors — can do so free from the threat of deportation and can access higher education and become productive contributors to the Arizona economy.
For too many Arizonans, the future is uncertain, but Congress and the Trump administration can rectify that. The formula is simple: more border security and a coherent, reliable system to keep and welcome productive people to our country.
We will work with Congress and the administration as we continue to pursue our longstanding goal of visa reform for all skill levels. Let’s take advantage of the fact that the best, brightest and hardest workers on the planet (like my wife, Tali, originally from Israel) want to live in the United States.
Arizona has made the right policy moves for over a decade. Other states have pursued the wrong ones, and their economies have suffered as a result. Let’s keep the momentum up in 2020. Arizona’s job creators can’t wait to get started.
Glenn Hamer is president and CEO of the Arizona Chamber of Commerce and Industry.