A new study released this month challenges the popular notion that government creates no jobs.
The Idaho National Laboratory creates more than 24,000 Idaho jobs and generates $3.5 billion in economic impact, according to Boise State economists.
The eastern Idaho Department of Energy research facility had more than 8,000 people directly working for the government or its contractors in Idaho making it the second largest employer in the state. The largest is the Idaho state government, The BSU study said.
An additional 16,133 people have jobs because the INL is there due to the multiplier effect. That includes people working in the state’s largest private employer, Walmart.
“Although state government is Idaho’s largest employer, it is important to keep in mind that most of its funding comes from sources within the state,” said Geoffrey Black, chairman of the Department of Economics at Boise State and a researcher on the project. “INL is not only the second largest source of jobs in the state, but nearly all of its funding comes from outside Idaho.
“This provides a huge shot in the arm to the state’s economy, particularly in the eastern part of the state,” Black said. “Nothing else comes close.”
The study shows that INL increased personal income in Idaho by $2 billion. Even though its money comes from the federal government it generated more than $135 million in personal income, corporate income, sales and other taxes paid to the state. And INL contractors and the federal government paid another $2.5 million to Idaho colleges and universities for their employees’ continuing education.
Black points out the obvious that many Idahoans simply scoff at: The INL has been a stabilizing force in Idaho’s economy, especially as the private economy has dropped into the deepest recession since the 1980s.
“The state’s economic picture is substantially brighter than it would be without INL,” Black said.
So think about this. The INL had more than 12,000 employees in 1990 before the end of the Cold War and the Clinton Administration’s drive to balance the federal budget dramatically cut its programs. By the end of the 1990s it had just over 6,000 employees and its impact on the state’s economy dropped with it.
We are now seeing a consensus forming again to cut the federal deficit. That means that all federal programs will likely come under the axe in one way or the other. We have already seen state government trim thousands of jobs since 2007.
So that mean’s Idaho private sector employers are going to have to grow even more to make up for the government chunk of the economy. They were up to the task in the 1990s, driven in part by the housing boom.
That boom was aided in eastern Idaho by the large number of INL retirees who stayed put and kept their government pensions pumping dollars into Idaho's economy. Today companies like Melaleuca and Premier Technology are thriving there and the French government-subsidized company Areva, is on the cusp of opening its doors in eastern Idaho.
The private sector has repeatedly shown itself to be the most efficient at creating wealth, which few economists challenge. But government policies from land give-aways to interstate highway development to energy research all have helped make the U.S. the richest nation in the world.