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October 31, 2009

Our View: Social well-being key to economic well-being

While the Mankato region continues to develop economically even in a recession, a recent government report suggests warning signs on some indicators of social well-being.

The recently released American Community Survey shows from 2005 to 2008 the number of families in the Mankato-North Mankato micropolitan area living in poverty increased from 6.2 percent to 8.2 percent. For families with children under 5 years old, the rate went from 13 percent to 17 percent.

This kind of social decline may not be surprising in the midst of one of the worst recessions in recent history, but it exists in a local economic environment where over the same period, employment and wages have been rising. Average weekly wages over the 2005-08 period rose 14 percent for Nicollet County, and 9 percent for Blue Earth County.

So, essentially, there are a growing number of people not participating in the growth of wages in the region.

There is more evidence of the population of need growing. The number of people needing food stamps was estimated at about 2,400 in 2005 and 2,550 in 2008. Anecdotal evidence show food shelf use has been up as much as 50 percent to sometimes double the level of last year in Mankato and the region.

The level of poverty puts more pressure on social service agencies from county public assistance offices to jails. A number of social ills will continue to rise with poverty rates.

The obvious solution to poverty is the existence and presence of jobs that offer wages high enough to provide for one’s basic needs. While there’s progress in this area, it hasn’t been enough to satisfy the needs of those seeking employment.

Employers in Blue Earth and Nicollet counties have added about 2,000 jobs from 2005 to 2008, but those seeking work has grown by about 5,000. In fact, during the same time period, the number of employer “establishments” in both counties has declined by about 30 businesses.

While there may be no easy solutions to reducing poverty and creating more jobs for those who want them, there are things communities can do to ensure that when economic circumstances do change, the infrastructure is ready to support the growth.

Lack of sufficient child care, for example, could be a barrier to a parent returning to work. Something as simple as public transportation can also impact our readiness to get workers to businesses. When government can assist with reasonable and moderate risk financing for a business, it might make sense. The recent efforts of the North Mankato Port Authority to assist in the financing of Thin Film will allow the company to keep jobs now and maybe add them later.

The private sector, by and large, must provide the jobs, but the public sector can and should make sure the support and tools are ready to facilitate job creation. Lower poverty rates and social development go hand in hand with economic development.

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